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E-invoicing in Saudi Arabia is an innovative process which is being implemented by the Zakat, Tax, and Customs Authority (ZATCA) to boost the transparency of the business transactions. The first is the Cryptographic Stamp Identifiers (CSID), which is used for the purpose of electronic invoices’ identification and its integrity. The CSID plays a central role in establishing a connection between an EGS unit and a trusted authority to strengthen the credibility of the e-invoice system in the Kingdom.
For Riyadh and Saudi Arabia as a whole, e-invoicing has emerged as one of the most quickly adopted measures for compliant business practices. A Cryptographic Stamp Identifiers serves as a cryptographic certificate through which businesses can safely communicate and authenticate with ZATCA’s systems and encrypt their data. It makes every e-invoice and the credit or debit note linked with it credible, which creates trust among the stakeholders.
This blog post explores everything that you may want to know about CSID including what they are, how they work, and how to obtain and manage them. If you’re a Saudi Arabia-based business preparing for the e-invoicing Phase 2 or uncertain about how your ERP/POS connects with the Fatoora portal, this guide addresses all these needs.
A Cryptographic Stamp Identifiers (CSID) is a cryptographic certificate that binds the EGS unit to the third-party, including Quickdice. This certificate assists in the authentication of the EGS unit that is used to generate the cryptographic stamp for the invoices. A CSID in effect affirms the ownership of the public key that is linked to the EGS unit and guarantees the authenticity of the electronic invoices.
In other words, CSID can be a secure and verified identity of the e-invoice solution unit. It connects generation of the invoice with the authority of the seller, which is another plus for e-invoicing.
Cryptographic Stamp Identifiers (CSID) is particularly relevant within the framework of e-invoicing in Saudi Arabia. Due to the implementation of the ZATCA e-invoicing mandate, it becomes the responsibility of the businesses to make sure that the invoices have to be original and created in a secure manner. CSIDs make sure that the e-invoice conforms to all the ZATCA standards by checking its authenticity and the genuineness of the invoice. Furthermore, CSIDs are also used to call other APIs that are associated with reporting and clearance to make the e-invoicing process more efficient in Riyadh and throughout Saudi Arabia.
As ZATCA mandates CSIDs in its e-invoicing solution, companies need to learn how CSIDs function and how to incorporate them into their e-invoicing solutions. Companies cannot produce legal and compliant invoices that will be acceptable by the ZATCA without having a CSID.
According to ZATCA, businesses that are registered for VAT in KSA and are part of the wave-based implementation of phase 2 of e-invoicing will be required to apply for a CSID. The ZATCA categorises taxpayers according to their VAT turnover, and companies in these categories must register their EGS units to create cryptographic stamps for invoices. The CSID guarantees that organisations in these groups adhere with the rules of e-invoicing and authenticate their invoices safely.
Businesses that are part of the applicable taxpayer group will require a CSID to generate e-invoice that meets the regulations. ZATCA communicates the status of the business to the business and it is important to act fast in order to integrate.
A CSID is obtained by first signing into the ZATCA e-Invoicing Integration Portal. Companies need to have their current accounts on the portal to apply and deal with the CSIDs for the EGS units.
This involves creating a Certificate Signing Request (CSR) and passing through a compliance test before one is provided with the CSID. This process also helps to avoid giving fake or unauthorized EGS units a CSID for the validation of e-invoices.
When a new EGS unit joins the system with a CSID, there are some steps that have to be taken to integrate the device into the e-invoicing system.
Step 1: Create One Time Password
The first process in the onboarding process is to create an OTP from the Fatoora portal. The OTP can be manually keyed in directly into the EGS unit or inputted automatically.
Step 2: Complete Compliance Checks
Once the OTP is entered the EGS unit goes through a compliance check to ensure it complies with the regulations of the ZATCA.
Step 3: Request and Receive CSID
Upon the completion of the checks, the e-invoice platform asks for the CSID from the Certificate Authority of ZATCA and then the CSID is provided to the EGS unit. This identifier will enable the unit to produce cryptographical stamps for e-invoices.
There are two methods for OTP entry:
From the ZATCA guidelines, Cryptographic Stamp Identifiers must be renewed every five years. This renewal process entails cancellation of the previous CSID and the generation of a new one. Any business must pay attention to the renewal dates and make sure they renew their compliance status following the right procedures to avoid interruption.
Also, any business entity can cancel the CSID as and when it is required, and ZATCA can also cancel the CSID without prior notice in some circumstances.
Saudi Arabia’s e-invoicing system relies on Cryptographic Stamp Identifiers (CSID) to authenticate and verify electronic invoices. As a result of the e-invoicing mandate by ZATCA, it is required that CSIDs be incorporated into the E-invoicing in Riyadh Generation Solution units. This helps businesses in avoiding penalties and maintaining a smooth running of their operations with the compliance to ZATCA regulations on all invoices.
If your business is gearing up for e-invoicing phase 2 it is important to know about CSID and the steps that needs to be followed to meet the e-invoicing compliance. It is as simple as registering a new EGS unit, or renewing an existing CSID, but essential in order to remain compliant with ZATCA’s e-invoicing system
