VAT (Value Added Tax)
Fateh ERP handles Saudi Arabia VAT automatically. Here's how it works and what you need to know.
How VAT works in Fateh
Fateh ERP separates your transactions into:
| Type | Description | Where it appears |
|---|---|---|
| Output VAT | VAT you charge customers (collect on their behalf for ZATCA) | Sales Invoices |
| Input VAT | VAT you pay to suppliers (you can claim this back) | Purchase Invoices |
| Net VAT payable | Output VAT minus Input VAT = what you pay to ZATCA | VAT Return report |
Setting up VAT on items
To make VAT appear automatically on invoices:
Open an Item
Go to Stock → Items and open any item.
Taxes tab
Click the Taxes tab on the item form.
Add Tax Template
Click Add Row and select KSA VAT 15% (or the tax template your accountant set up).
Save
Now every time this item is added to an invoice, 15% VAT is calculated automatically.
Generating a VAT return
At the end of each VAT filing period (quarterly for most businesses):
Go to Reports → VAT Audit Report
This shows all sales and purchase invoices with their VAT amounts for the period.
Set the date range
Select the start and end date of your VAT period.
Review the summary
Check: Total Output VAT (from sales), Total Input VAT (from purchases), Net VAT payable.
Export
Download the report as Excel or PDF to prepare your ZATCA VAT return filing.
Zero-rated and exempt items
| Category | VAT Rate | Examples |
|---|---|---|
| Standard rated | 15% | Most goods & services |
| Zero-rated | 0% | Exports, international transport, certain medicines |
| Exempt | No VAT | Residential property rental, certain financial services |
For zero-rated exports, use a separate tax template KSA VAT 0% on those items.