Saudi Arabia has been running structured e-invoicing longer than almost anyone in the region. Phase 1, the generation phase, has required compliant electronic invoices since December 2021. Phase 2, the integration phase, connects each taxpayer's invoicing system directly to ZATCA's Fatoora platform, and it has been rolled out in waves by revenue since January 2023. On 24 July 2026, ZATCA announced Wave 25: every taxpayer whose VAT-subject revenue exceeded SAR 187,500 in any year from 2022 to 2025 must be integrated by 1 February 2027.
That threshold reaches deep into the real estate market. Family offices holding a single retail building, owners of a small office block, and mid-sized property managers who were comfortably outside earlier waves are now in scope. Many of them bill rent out of Yardi Voyager, and Yardi is a strong foundation for Phase 2: the lease, the tenant, the charge schedule and the GL are already in one system. The task is making sure that data is shaped the way Fatoora expects, and connecting it to a ZATCA-compliant e-invoicing solution that handles clearance and reporting.
The rollout so far
Where the integration waves stand today
The revenue threshold has dropped with every wave, and the last two each halved it. ZATCA notifies targeted taxpayers directly and has committed to at least six months' notice before each future integration date. The four most recent waves are below.
| Deadline | Who is in scope | Status |
|---|---|---|
| 31 December 2025 | Wave 22: VAT-subject revenue above SAR 1 million in 2022, 2023 or 2024. | Live |
| 31 March 2026 | Wave 23: revenue above SAR 750,000 in 2022, 2023 or 2024. | Live |
| 30 June 2026 | Wave 24: revenue above SAR 375,000 in 2022, 2023 or 2024. | Live |
| 1 February 2027 | Wave 25: revenue above SAR 187,500 in 2022, 2023, 2024 or 2025. One qualifying year is enough. | Upcoming |
The mechanics are the same for every wave. Standard tax invoices, the ones issued to VAT-registered businesses, follow a clearance model: the invoice is sent to Fatoora as UBL 2.1 XML, validated and stamped, and only then shared with the buyer. Simplified invoices, for consumers, are reported to Fatoora within 24 hours of issue. Every invoice carries a cryptographic stamp, a QR code and the hash of the previous invoice, so the sequence itself becomes evidence. Credit and debit notes go through the same process.
Inside Yardi
Five areas to get right before you connect
In our experience, the integration itself is rarely the hard part. The time goes into the data Yardi sends. These are the five areas we review first with Saudi clients.
Map every charge code to the right VAT category
Real estate is one of the few sectors where a single landlord routinely bills both standard-rated and exempt supplies. Commercial leases for offices, retail, warehousing and industrial space carry VAT at 15%. Leases of residential property are exempt. Mixed-use contracts that cover both have to be apportioned, with VAT applied only to the commercial share.
Yardi handles this well when each charge code carries the correct tax treatment, so base rent, service charges, parking, utilities recovery and late fees each flow onto the invoice with the right category and rate. Fatoora validates those categories line by line. A charge code set up years ago with a blanket 15% rule, or with no tax code at all, is a common reason an otherwise clean invoice gets rejected, because ZATCA treats wrongly populated VAT values as a significant error that must be corrected and resubmitted. Your tax advisor should confirm the treatment of each charge type. Yardi then applies it consistently on every billing run.
Complete the buyer details on every commercial tenant
A standard tax invoice needs the buyer's VAT registration number, legal name and address. ZATCA also requires the visible content of an invoice to be in Arabic, with other languages allowed alongside it, so tenant names and addresses need an Arabic version as well as the English one. In Yardi, these fields live on the tenant and customer records. A missing mandatory field means the invoice is rejected and must be resubmitted. A smaller gap, such as a missing building number, comes back as a warning that still needs fixing before the next invoice.
This is also where you decide whether a tenant receives a standard or a simplified invoice. A VAT-registered corporate tenant receives a standard invoice that must be cleared before it is shared. An individual receives a simplified one that is reported afterwards. Getting that flag right on each tenant record in Yardi means the e-invoicing solution can route every invoice correctly without anyone checking it by hand.
Under Phase 2, a rent invoice to a business tenant cannot be shared, and is not legally valid, until Fatoora clears it. Approvals have to happen before the invoice is generated, and nothing should reach the tenant until it carries ZATCA's stamp.
Artisan Solutions · Specialist Yardi Consulting, Saudi ArabiaPlan recurring billing around clearance
Many Saudi landlords bill rent in advance on a monthly, quarterly or semi-annual cycle, and Yardi generates those charges in bulk from the lease schedule. Under the clearance model, every standard invoice in that batch must be validated by Fatoora before it reaches the tenant. A quarterly billing run of several hundred commercial invoices becomes several hundred clearance calls.
That works smoothly when the batch is clean and the e-invoicing solution handles queuing and retries. It is worth deciding in advance what happens to an invoice that fails clearance, who corrects it in Yardi, and how quickly it is resubmitted, so that one rejected invoice does not hold up a whole property's billing.
Treat credit notes as first-class invoices
Lease amendments, rent-free periods, early terminations and service charge reconciliations all generate adjustments. Under Phase 2, each credit or debit note must reference the original invoice it corrects and go through Fatoora like any other invoice. A manual journal that reverses a charge in the GL is not enough on its own.
Yardi's receivables workflow already ties adjustments to the original charge, which is exactly the link Fatoora needs. The practical step is agreeing with your finance team which adjustment types must produce a formal credit note, and making sure the reason and original invoice reference are captured when the adjustment is entered, not reconstructed afterwards.
Onboard each legal entity and test before go-live
Every invoicing unit must be onboarded on the Fatoora portal and receive a cryptographic stamp identifier, first for compliance testing and then for production. Groups that hold properties in separate special-purpose companies, each with its own VAT number, need to onboard each entity separately, and Yardi's entity and property structure should make it obvious which identifier signs which invoice.
Run the compliance checks against a Yardi test database populated with your real lease scenarios: a mixed-use contract, a residential lease, a corporate tenant with a credit note, an individual tenant with a late fee. Finding a mapping gap in testing costs an afternoon. Finding it in production delays the tenant invoices waiting behind it.
Preparation checklist
What Saudi landlords on Yardi should be doing now
With the Wave 25 deadline on 1 February 2027 and billing cycles that often start in January, there is less runway than the date suggests.
- Check VAT-subject revenue for 2022 to 2025 for every legal entity in the group, and confirm which wave each one falls into
- Export the Yardi charge code list and confirm the VAT category and rate for each code with your tax advisor
- Identify mixed-use leases and confirm how the commercial share is apportioned in Yardi
- Audit tenant records for VAT numbers, national addresses and Arabic names, and set the standard or simplified flag on each
- Agree which adjustment types produce a credit note and how the original invoice reference is captured
- Select a ZATCA-compliant e-invoicing solution and plan how it receives invoice data from Yardi
- Onboard each entity on the Fatoora portal and complete compliance testing well ahead of your first post-deadline billing run
The rules that shape your Yardi configuration
Closing thought
Clean data clears first time
ZATCA has built one of the most mature e-invoicing systems in the world, and each wave brings more of the Saudi real estate market into it. For landlords on Yardi, Phase 2 is less about new technology and more about precision: charge codes that carry the right tax treatment, tenant records that are complete in both languages, and adjustments that are documented as they happen.
Yardi already holds all of that in one place. Firms that use the run-up to February 2027 to tighten their configuration will find that Fatoora clears their invoices without fuss, and they will have a cleaner receivables process for it. We took the same approach when we built our e-invoicing integration for the UAE mandate, and it applies just as well in the Kingdom.
If your entities fall into Wave 25 and you want a second pair of eyes on your Yardi setup, talk to us. We work exclusively in Yardi, and Saudi real estate is a market we know well.