The invoice – probably the most common document in the German economic area – is dying out, at least if you look at the classic paper invoice. Of course, it is still indispensable in everyday life, because where services are billed, an invoice always follows… sooner or later. By 2018 at the latest, companies must be using e-invoicing productively and it is worthwhile to start planning in good time. But how exactly do you go about making the best possible use of the advantages of e-billing? What should be considered before and during the introduction? And what does working with e-invoicing look like in concrete terms?
Transforming the classic invoice
In the course of the digital transformation, the well-known paper invoice is transforming into electronic invoices, or e-invoices for short. It is an invoice received in paper form and transformed into electronic formats. The term “invoice” does not fall under the definition of electronic invoice according to the VAT Act.
The aim of e-invoicing is to facilitate communication through electronic administration and thus offer a simple and user-friendly service. In this way, the electronic exchange of invoices enables the sending and receipt of invoice data. They provide further processing without media discontinuity. This results in savings potentials that have been scientifically proven – up to 80 percent. The Directive, which came into force on 26 May 2014, obliges public administrations to receive and process invoices in electronic form. The prerequisite for this is that the invoices were created with a specific invoice data format. 36 months after the agreement comes into force, a data model for the e-invoices is to be available. After another 18 months, the guidelines become mandatory.
The goal is also to fully automate the processing of an invoice. Recipients of invoices must therefore process them digitally, based on data. The consent is not bound to any special legal provision. The use can be included in the general terms and conditions.
Policies and retention periods
It does not matter whether the electronic format is presented either as an image, by e-mail or download – it must be forwarded electronically. The retention periods in Germany are ten years.
The legal requirements state that the mandatory information of an invoice must also be found on an electronic one. The e-invoices must be kept in the format in which they were received. If, for example, it is received as a PDF file, it must also be digitally archived in this type. The retention must comply with the principles of proper accounting, those of computer-based accounting systems as well as those of data access and the verifiability of digital documents. Storage is not justified as a paper printout.
The legibility of the electronic invoice must be ensured – it must be readable by both employees and external parties from the beginning of invoice creation and to the end, regardless of its format.
The authenticity of the origin and the content must be guaranteed. This is also done by means of an electronic signature or data exchange.
Advantages of electronic invoicing
Paper-based processes are being replaced by invoice automation. Not only shipping, but also forwarding or archiving in the company are affected. This eliminates the need for paper filing and shelves full of file folders. Since paper invoices often have to be transported via the post office so that they end up in the accounting department, they can be sent directly to the recipient. This process accelerates and reduces transit times. Price reductions such as discounts and compliance with deadlines can also be guaranteed.
Every employee has the direct and simultaneous availability of electronic documents and this is followed by the low effort required to search for copies.
It is possible to gain access to larger business partners, as they usually already process business transactions electronically.
Result
The use of e-invoices essentially has only advantages. All companies, self-employed persons or tradespeople should spread their processes to this procedure as quickly as possible. The path to practical implementation is easier than many owners imagine. However, the guidelines must be observed so that there are no consequences in the context of a tax audit.
How have the requirements for accounting changed in your opinion? We look forward to your comments.
Image source: Fotolia.com, Photographer: Zerbo
