The Beginner’s Guide To E-Invoice And E-Document Compliance

Thursday, 16. December 2021 | 0 Comments

e-invoiceThe advancement of technology and science warrants a comprehensive understanding of e-document and e-invoice compliance necessary for all business owners. If you are a business owner, read on to understand why e-invoice and e-document compliance are essential. Get to know how to meet e-document compliance requirements and much more.

E-documents and e-invoices: What are they?

To understand what e-documents are, let’s know what e-invoices are. E-invoices (electronic invoices) are the best regulated electronic transaction document. With the government’s implementation of various types of digital tax laws, e-invoices have grown in popularity. E-invoices are just one of the several types of e-documents. An e-document is any document that has been electronically generated, transmitted, processed as well as archived. 

According to the report, the global e-invoicing market was valued at approximately USD 4,649 million in 2018 and is expected to generate around USD 20,529 million by 2026, at a CAGR of around 20.4% between 2019 and 2026.

Importance of e-invoice and e-document compliance

Why are e-invoice and e-document compliance important?  For business owners, e-invoice and e-document compliance are crucial. VAT and other taxes (relevant to businesses) need correct handling of invoices and data. Taking care of taxation minimizes related risks such as penalties and fines. Proper handling of such taxes also ensures that businesses receive refunds (VAT refunds) timely and correctly. That’s why compliance in terms of e-invoice and e-document is essential.

From the tax authorities’ perspective, e-document and e-invoice compliance ensure stable and predictable tax collection. Compliance can positively influence funding and close the VAT gap for various government initiatives.

E-document compliance: Conditions and requirements

There are several conditions and requirements of e-document compliance that businesses must meet. These can vary depending on the country. However, the general conditions include:  

  • Formatting documents should be as per the guidelines provided by trading partners and the government where applicable.
  • Content requirements must be as per government regulations and the regulations provided by trading partners.
  • Authenticity and integrity of the documents that get exchanged (e.g., BCAT, EDI, electronic signatures, and validations).
  • An open interoperability approach for transactions between a business and vendors.
  • Mandatory governmental infrastructures must connect businesses.
  • Data protection and security implications the documents exchanged electronically.
  • Archiving documents as per the requirements of the country.
  • Accreditation or approval from the local tax authority to prove that a business meets all the technical requirements.
  • The transition to the use of electronic documents must be consented to by the recipient of the e-document.

How can a business meet its e-document compliance requirements?

Ideally, businesses can meet e-document compliance requirements by companies by implementing the following solutions:

  • Having regulatory compliance experts. These experts can efficiently monitor mandates as well as changes in e-document legislation.
  • Integration of various services into a business’s existing accounting system or ERP can avoid system changes. For example, using GetMyInvoices you can integrate to ERP, accounting and other systems.
  • Implement automated invoice management solutions that help automatically download invoices from different portals.
  • A cloud-based, open network with connections to government authorities, private businesses, and other business networks.
  • An efficient 24/7 customer support service can address technical issues.
  • Onboarding support to notify all business partners about the transition to e-documents.

Implement the strategies mentioned above to maximize e-document compliance in your business.

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