Exemption reason codes on a Saudi invoice line
Under ZATCA e-invoicing, a zero-rated, exempt or out-of-scope line says why with one of ZATCA's VATEX codes. The picker offers only the codes that belong to the line's VAT category.
Open the invoice, choose Edit lines (or add the lines in New invoice), and set the line's VAT category first. The Exemption reason code list then offers only the codes ZATCA allows for that category.
- E (exempt): VATEX-SA-29, VATEX-SA-29-7 and VATEX-SA-30.
- Z (zero rated): VATEX-SA-32, VATEX-SA-33, VATEX-SA-34-1 to VATEX-SA-34-5, VATEX-SA-35, VATEX-SA-36, VATEX-SA-EDU, VATEX-SA-HEA and VATEX-SA-MLTRY.
- O (out of scope): VATEX-SA-OOS. Type the reason in your own words in Exemption reason.
- S (standard rate): the picker is disabled and left empty, because a standard-rated line has nothing to be exempt from.
Picking a code fills Exemption reason with ZATCA's official English wording. For VATEX-SA-OOS the box stays empty for you to type in. If you change the VAT category afterwards, a code that no longer fits is cleared, together with the wording it filled in.
The list is kept under Accounting, Tax, VAT Exemption Codes, with each code's VAT category and its English and Arabic wording. It follows ZATCA's E-Invoice XML Implementation Standard (version 1.2, 19 May 2023).
Posting checks the same list, so an invoice whose line has a code from another category (for example an exempt line with VATEX-SA-32) is refused at Post whichever way the line was entered.