Nota Fiscal for Services – Looking at Inbound AP Invoices

Scott Lewin
November 12, 2012

First it is helpful to review the differences between NF-e for Goods and NFS-e for services:

NF-e for Goods vs NFS-e for Services

Goods Oriented NFE

  • Taxes assigned at State level, so much higher adoption and standardization
  • Digitally signed by emitter for non-repudiation and authentication to receiver
  • Electronic file is the legal invoice – paper visualizations for human comfort only
  • Invoices must be registered and approved before being sent
  • Printed DANFE must accompany goods in transit for validation en route
  • Inbound invoices must be validated and there are new “Eventos” processes taking place to eliminate ghost transactions.
  • Archive for 5 years by sender

Service Oriented NFS

  • Tax is assessed by Cities, so Integration Points are at City Level
  • Standardization came slowly but is advancing now
  • Can have many line items, but only one type of service per NFS.
  • Can deliver services and then invoice later, this is not a problem.
  • Can be withholding requirements for certain service types
  • NFS number and Return Code provided by the City
  • City calculates the tax for you – you make FI adjustments if needed.
  • City does the validation, buyer doesn’t have to worry about anything, except withholding, if applicable
  • Cancellations allowed within 30 days or 5 days after start of new month, whichever is earlier
  • Archive for 5 years by city

3 Types of Inbound City Level Connectivity

  1. Fully Integrated Web Service- there are a number of cities that offer a fully functioning web service integration. This allows the use the web service to call the city system and download the service invoices directly into a company’s environment.
  2. Partially Automated– there are a larger majority of cities that utilize this process currently. While they use a standardized format for the invoice collection, the actuall triggering event is manual. Many of the customers’ I work with will deploy a special desktop extension that allows them to upload the invoice files directly into an ERP staging area for further processing.
  3. Manually- it is important to understand when working with city level integration that many of them are still in a manual mode. There won’t be a complete way to automate these cities.

Best Practice: If you are looking to process inbound service invoices, you should work with a provider that not only understands the current city connectivity options but also has many of the larger cities already integrated into their platform. Lastly, you also need to understand which cities will be producing the invoices.

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Scott Lewin

Gain timely insight and important up to the minute information about the current legislative changes in Latin America, including Brazil Nota Fiscal, Mexico CFDI, Argentina AFIP and Chile DTE. Learn how these changes affect your operations, your finances and also your Information Technology teams.
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