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Poland SAF-T framework

Poland is one of many countries to use the Standard Audit File for Tax (SAF-T) to streamline tax compliance and reporting for businesses. The country was one of the first in Europe to replace the traditional VAT return with SAF-T.

Poland introduced its version of SAF-T, known as Jednolity Plik Kontrolny (JPK), in 2016, making monthly submissions of JPK_VAT compulsory for all taxpayers in 2018.

In 2020, JPK_VAT combined with the VAT return and is submitted with a declaration per the frequency of the VAT Return (monthly or quarterly).

Submission of the remaining seven JPK structures is upon request of the tax authority in the event of an audit.

Please note: JPK_VAT with the declaration is in the process of changing as a result of the introduction of mandatory e-invoicing via KSeF in Poland.

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Table of contents

1. The legal framework of SAF-T in Poland

2. Timeline SAF-T in Poland

3. Understanding JPK VAT and SAF-T in Poland

4. Implementing SAF-T as a business

5. Other requirements for VAT compliance in Poland

6. FAQ

7. How Sovos can help

8. Related resources

The legal framework of SAF-T in Poland

The Poland SAF-T framework consists of eight JPK structures:

JPK_V7M/K

declaration for records of VAT purchases and sales combined

JPK_FA

for VAT and VAT invoices

JPK_WB

for bank statements

JPK_PKPIR

for revenue and expense ledger

JPK_EWP

for revenue account

JPK_KR

for accounting books

JPK_MAG

for warehouses

JPK_FA_RR

for flat rate VAT invoices

Other than the monthly or quarterly periodic submission of JPK_V7M/K, submission of all other JPK structures is on demand.

However, from 1 January 2025, reporting of JPK EWP, JPW PKPIR, and JPK_KR will become a periodic reporting obligation.

Timeline SAF-T in Poland

  • 1 July 2016: SAF-T introduced in Poland in the form of JPK files
  • 1 January 2018: Poland mandated JPK_VAT for all taxable persons
  • 1 July 2018: Taxpayers must be able to produce accounting documents in JPK structures
  • 1 October 2020:  JPK_VAT with declaration consolidates the VAT Return and JPK_V7M/K
  • 1 July 2021: Amendments to the mandatory JPK_V7M/K adopted
  • 1 January 2022: Amendments to the JPK_V7M/K structure including changes to better align it with the EU VAT e-Commerce package
  • 1 January 2025: Reporting of JPK EWP, JPW PKPIR, and JPK_KR becomes a periodic obligation

Understanding JPK VAT and SAF-T in Poland

One of the eight JPK structures in Poland is JPK_VAT, a declaration combining VAT purchase and sales records. As of 2020, JPK_VAT must be sent alongside VAT returns to the tax authority.

JPK_VAT with the declaration has two variants, depending on the submission frequency of the VAT return:

  • JPK_V7M for taxpayers settling VAT monthly.
  • JPK_V7K for taxpayers who settle VAT quarterly.

Submission of JPK_V7M and JPK_V7K is on the 25th of the month following the reporting period.

The other SAF-T JPK structures for VAT are JPK_FA for VAT invoices and JPK_FA_RR for flat-rate VAT invoices. JPK_FA and JPK_FA_RR are both submitted on demand.

Implementing SAF-T as a business

SAF-T requires additional data to analyse and authenticate the accuracy of documentation. All data submitted in the SAF-T consolidated submission must be accurate and complete to ensure compliance.

Data for SAF-T requirements is often extracted from multiple sources for a single report and combining this data can be difficult.

The data required for SAF-T differs significantly from other reporting obligations that businesses might be familiar with. The XML format required for reports makes it difficult to review, compare or test reports ahead of submissions.

Sovos SAF-T Solutions

Sovos’ SAF-T software solutions help businesses manage their SAF-T requirements across multiple jurisdictions, including Poland.
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Sovos SAF-T Extraction

Sovos SAF-T Extraction automates processes to seamlessly extract required data.
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Sovos SAF-T Generation

Sovos SAF-T Generate maps data accurately to SAF-T structures in the latest legal formats for timely SAF-T reporting.
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Sovos SAF-T Analysis

Sovos SAF-T Analysis performs deep analysis on SAF-T output generated. Sovos’ managed services is available for non-EU businesses selling in Poland requiring fiscal representation.
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Other requirements for VAT compliance in Poland

As well as Poland’s SAF-T requirements, taxpayers need to also be aware of the KSeF e-invoicing mandate. Poland’s continuous transaction control (CTC) e-invoicing system is mandatory as of 1 July 2024, expanding to VAT-exempt taxpayers in 2025. Read this overview for a general introduction to Poland VAT compliance.

FAQ

JPK_VAT with a declaration is an electronic document that includes both VAT records, combining information on purchases and sales and VAT returns (VAT-7M and VAT-7K).

JPK_VAT is submitted on a monthly or quarterly basis.

Yes, SAF-T is mandatory in Poland. JPK VAT with a declaration must be sent to the tax authority on a periodic basis, while other types of JPKs are sent on demand.

Failure to comply with the SAF-T requirements in Poland can lead to penal and fiscal sanctions, based on a misdemeanor or a felony. If the value of the reduction of the tax liability exceeds PLN 10,000, it is a crime.

Submission of JPK_VAT with the declaration (JPK_V7M and JPK_V7K) is on the 25th day of the month following the reporting period. Other JPKs are submitted to tax authorities within three days after receiving a request from the tax authority.

Our Solution capabilities for Poland SAF-T

Data Extraction

Painlessly aggregate and consolidate data from a wide range of source systems complying with Poland’s SAF-T requirements including JPK files.

More about data extraction

Data Analytics

Check the accuracy, integrity and quality of complex data structures required by Poland SAF-T to give you peace of mind before you submit your JPK files to the tax authority.

More about data analytics

File Generation

Ensure that all required data sets from accounting entries, sales and purchase transactions, asset depreciation, stock movements and more, are mapped seamlessly into Poland’s JPK schema, ready to be analyzed and submitted to the tax authority.

More about file generation

Get the information you need

Related resources

VAT Digitization in Eastern Europe

Free ebook including country cards for VAT compliance
Learn more

Poland: E-Invoicing

An overview for e-invoicing obligations in Poland
Learn more

SAF-T International Standards

Your ebook for all things SAF-T
Read now

Romania e-invoicing

E-invoicing in Romania is developing fast. With a current B2G and High Fiscal Risk B2B mandate already in place and a new obligation facing all companies with operations in Romania from 1 Jan. 2024, it can be hard to stay on top of your business’ requirements. Failing to comply with Romania’s e-invoicing and e-reporting mandates will result in penalties, but more importantly, it will lead to invalid tax invoices – which don’t allow for VAT deduction – and, ultimately, may also trigger protracted tax audits, so it is crucial that you are aware of your requirements.

Read on to learn about the current state of Romania e-invoicing – from continuous transaction controls (CTC) and e-Factura to B2B e-invoicing developments – and what’s to come.

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Table of contents

1. At a glance: Romania e-invoicing
2. E-invoicing regulations in Romania
3. Benefits of e-invoicing
4. How to choose the right e-invoicing software in Romania
5. Future of e-invoicing in Romania
6. Additional obligations for VAT compliance in Romania
7. FAQ
8. Setting up e-invoicing and e-reporting in Romania with Sovos
9. Additional resources

At a glance: Romania e-invoicing

Romania B2G e-invoicing

CTC Type
E-invoice clearance coupled with e-reporting requirements for transactions carried out between January and July 2024 with public institutions

Network
Centralised network where the e-invoice exchange is primarily processed through the RO e-Factura platform

Format
UBL 2.1 XML format file following CIUS RO national validation rules

eSignature Requirement
Digital Seal applied by the Ministry of Finance

Romania B2B e-invoicing

CTC Type
E-invoice clearance coupled with e-reporting requirements for transactions carried out by VAT-registered entities

Network
Centralised network where e-invoice exchange is primarily processed through the RO e-Factura platform

Format
UBL 2.1 XML format file following CIUS RO national validation rules

eSignature Requirement
Digital Seal applied by the Ministry Of Finance

Archiving Requirement
10 years

E-invoicing and e-reporting regulations in Romania

Romania introduced e-invoicing on a voluntary basis in November 2021 for B2G and April 2022 for B2B transactions. Romania’s Government Emergency Order no. 120/2021 implemented the RO E-Factura platform, the country’s e-invoicing system.

From July 2022, e-invoicing became mandatory for B2G and B2B transactions of so-called ‘high fiscal risk products’ following article II of Law no. 139/2022.

Romania applied for a derogation from the EU VAT Directive, aiming to implement a broader B2G and B2B e-invoicing and e-reporting mandate. The EU Council granted derogation in July 2023, allowing Romania to implement mandatory e-invoicing from 2024. The enacting of Law no. 296/2023 provides a new B2G and B2B e-invoicing mandate coupled with e-reporting requirements.

What is RO e-Factura?

RO e-Factura was officially launched in November 2021 as a voluntary clearance program for e-invoices, devised in an effort to streamline Romania’s tax collection. Users of e-Factura issue and submit their electronic invoices in a structured XML format through the system. Invoices are then cleared (following certain schema checks) and a digital seal is applied.

The RO E-Factura platform enables the automatic exchange of electronically issued invoices between entities registered in the system.

Romania B2B e-invoicing and e-reporting

B2B e-invoicing is already in play for transactions that include products deemed a high tax risk, including:

  • Fruit and vegetables
  • Alcoholic beverages
  • Mineral products
  • Construction materials
  • Clothing and footwear

Following the recently published mandate, B2B e-invoicing requirements will extend to all products. From January 2024, established and VAT-registered entities are required to report B2B domestic transaction invoices to the RO E-Factura platform within five days of issuance. From July 2024, invoices issued in transactions between established entities must be issued electronically through the RO E-Factura platform.

If, however, taxpayers fail to issue the invoice electronically through the RO E-factura platform, they are obligated to submit it to the RO e-Factura platform within five calendar days.

Romania B2G e-invoicing

From 1 July 2022, Romanian taxpayers were obliged to issue e-invoices, submitting them through the RO e-Factura system, when conducting business with the public sector. This obligation was namely within the context of certain public procurement contracts.

Romania’s e-invoicing mandate has expanded the scope of B2G invoicing in Romania which will apply to all transactions with public institutions from 2024.

Romania e-Transport system

Romania’s e-Transport system, often referred to as RO e-Transport, is used to monitor products when they are being transported. Coupled with the implementation of the CTC mandate, this is another reform that the nation has devised as part of its plan to combat tax fraud and evasion.

The application procedure of the RO e-Transport system has been approved by the joint Order of the National Agency for Fiscal Administration (ANAF) and the Romanian Customs Authority (AVR) no. 1190/4625/2022, with penalties applicable from October 2022.

The RO e-Transport system requires taxpayers to declare the movement of goods from one location to another, in advance of said movement. Once declared, it issues a number on the transport documents which is to be verified by authorities en route.

Read more about Romania e-transport system.

Timeline: e-invoicing & e-reporting adoption in Romania

The implementation of e-invoicing in Romania has been done in stages. This is a brief timeline of its adoption:

  • March 2020: E-invoicing system e-Factura is launched as a pilot program
  • October 2020: Government Emergency Ordinance (GEO) no. 120/2021 introduced the legal framework for the implementation of e-Factura
  • November 2021: Start of the voluntary phase for issuance of e-invoices for B2G transactions
  • April 2022: Invoices for B2B transactions of high fiscal risk transactions can be voluntarily submitted in e-Factura
  • July 2022: It is now mandatory to issue invoices for B2B transactions of high fiscal risk products through the RO e-Factura platform
  • January 2024: For B2B transactions, established taxable persons and VAT registered entities must report invoices in the e-Factura system within five days of issuance
  • April 2024: End of three-month grace period for e-invoicing mandate. Penalties will apply to non-compliant taxpayers
  • July 2024: The system will shift to an invoice clearance system for B2B transactions between established taxpayers
  • 1 July, 2030: Romanian VAT-registered businesses must comply with VAT in the Digital Age (ViDA) requirements, which include mandatory e-invoicing and digital reporting for Intra-Community B2B transactions.

Benefits of e-invoicing

From a business perspective, e-invoicing offers several benefits when compared to traditional invoicing. Benefits may include:

  • Saving costs by reducing paper, postage and manual labour
  • Saving time by using structured, automated electronic systems and processes
  • Increased compatibility and interoperability across businesses with initiatives like PEPPOL
  • Enhanced security can be achieved with the validation and authentication of systems like e-Factura

How to choose the right e-invoicing software in Romania

Considering the ever-evolving nature of regulations and mandates surrounding newer technologies and platforms like RO e-Factura, it is important that your business identifies and utilises the right software. The cost of using e-invoicing software that does not update with changes to regulations is not desirable for any organisation.

Setting up e-invoicing and e-reporting in Romania with Sovos

Get in touch with a Sovos expert to explore setting up e-invoicing and e-reporting in Romania.

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Future of e-invoicing in Romania

The future of e-invoicing in Romania has already arrived. Following the EU Council’s derogatory decision to allow Romania to implement mandatory e-invoicing, Romania published a more comprehensive B2B mandate with a 2024 roll-out date. The new law requires businesses to issue structured electronic invoices for transactions to both business and public sector entities, and it applies to established and VAT-registered entities.

The looming implementation of VAT in the Digital Age in the EU may deliver more changes in Romania, however. Aiming to digitise the European VAT system, this proposal is generating a lot of uncertainty for businesses that conduct operations in the EU as it includes requirements for digital reporting and e-invoicing – as well as changes to VAT registration

While the future of tax in the European Union may be uncertain, you can rely on Sovos to help you navigate the digital landscape. Bookmark this page to stay up to date with the latest developments.

Additional obligations for VAT compliance in Romania

While it’s important to ensure your business complies with Romania’s e-invoicing requirements should it qualify, there are other obligations that require attention – including general VAT Compliance and the Romanian SAF-T mandate.

The cost of non-compliance may be severe, but our materials and experts can be the helping hand you need to ensure you are meeting your obligations.

FAQ

E-invoicing will be mandatory for all B2B transactions in Romania from 1 July 2024, adding to the existing electronic invoicing requirements for B2G and high fiscal risk B2B transactions.

Between January and June 2024, established entities are required to report their B2B invoices to the RO e-Factura platform within five days of issuance. This reporting obligation applies to VAT-registered entities from January 2024 onwards.

There are numerous requirements for invoices in Romania, including:

  • Date of issuance
  • VAT number of both supplier and customer
  • Full name and address of both supplier and customer
  • Full description of applicable goods or services, including quantities
  • The net supply value
  • The gross invoice value
  • The applicable VAT rate

The Romanian e-Factura is a clearance system which sees e-invoices sent, cleared and received through the central platform.

Should a taxpayer in scope of the e-invoicing and e-reporting mandate not comply with its e-invoicing obligations, they may receive a fine. From April 2024 (at which time the 3-month grace period ends) 2024, large non-compliant taxpayers may be fined between 5,000-10,000 RON, and others may expect a financial penalty between 500-2,500 RON, when failing to meet the e-reporting requirements set forth. From July 2024, non-compliance with the with the issuance and receipt of e-invoices will result in a fine equal to 15% of the total invoice amount.

E-invoice and e-report in Romania with Sovos

Sovos’ continuous transaction controls (CTC) software was purpose-built to help customers stay on top of their obligations, wherever they do business, even as the rules change.

As CTCs and e-invoicing continue to grow in global adoption, it is vital to partner with a provider that closely monitors the decisions of tax administrations and understands the regulations you face. Sovos can help.

One of the largest spirits companies in the world, Brown-Forman turned to Sovos for help with several challenges it was facing surrounding changing e-invoicing regulations. The company needed a solution that would monitor and implement the fiscal requirements of the countries it operated in.

With Sovos e-invoicing compliance in place, Brown-Forman was able to redeploy its resources to core business functions knowing that its e-invoicing requirements were being met – both in the present and the future.

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Additional resources for e-invoicing compliance

E-invoicing: A Guide

Use this guide about e-invoicing in Europe to learn more about e-invoicing compliance in general.
Read now

VAT Digitization in Eastern Europe

Download this ebook for e-invoicing and real time reporting in Eastern Europe.
Learn more

E-invoicing Strategy with SAP

Learn how to solve the e-invoicing dilemma.
Learn more

Romania SAF-T declaration

Since 2022, medium and large taxpayers in Romania have had to report their VAT electronically to the tax authority under the international standard known as SAF-T (Standard Audit File for Tax).

Romania implemented SAF-T to improve the data it receives in VAT returns, requiring more granular detail that is reported in real time. As well as benefiting the Romanian tax authority, the electronic submission of the D406 streamlines tax compliance and reporting for businesses.

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Table of contents

1. The legal framework of SAF-T in Romania
2. How to declare tax information with the SAF-T system in Romania
3. What information must be declared to the ANAF?
4. When to submit a SAF-T declaration in Romania
5. Timeline SAF-T in Romania
6. Understanding SAF-T D406 in Romania
7. Implementing SAF-T as a business
8. Other requirements for VAT compliance in Romania
9. FAQ
10. Our Solution
11. Related resources

The legal framework of SAF-T in Romania

The SAF-T mandate in Romania has been introduced through the amendment of the Fiscal Procedure Code, which foresees the obligation for taxpayers to submit a declaration containing information from the accounting and tax records.

The Fiscal Procedure Code also determines that the submission of the SAF-T file must be done electronically, leaving the remaining conditions to be determined by order of the ANAF.

Accordingly, ANAF has issued Order No. 1783, of 4 November 2021, which introduced the SAF-T reporting requirement from 1 January 2022. The Order provided the SAF-T Form D406, as well as the legal deadlines for submitting the various SAF-T files and the procedure and conditions for submission.

In these terms, the D406 file must be submitted electronically by generating an XML format file, which is submitted to a validation procedure, and preparing the corresponding D406 Form in PDF format.

The various SAF-T files can be submitted monthly, quarterly, annually and on-demand, depending on the VAT regime applicable to the taxpayer as well as on the type of file being submitted.

How to declare tax information with the SAF-T in Romania

Transaction and accounting data must be reported through Declaratiei Informative D406. Taxpayers are required to submit the information electronically in PDF format with an XML attachment and electronic signature.

What information must be declared to the ANAF?

The Romanian SAF-T file, the D406, is comprised of five sections:

  1. General Ledger
  2. Accounts Receivable
  3. Accounts Payable
  4. Fixed Assets
  5. Inventory

The SAF-T D406 file to be submitted on a quarterly/monthly basis does not include information on Fixed Assets or Inventory. That data will be part of separate SAF-T files with different filling frequencies, namely the D406 Assets and the D406 Stocks.

Non-resident and small taxpayers will be required to submit a simplified SAF-T file from 2025 that will only account for the purchases and sales carried out through their Romanian VAT ID.

When to submit a SAF-T declaration in Romania

Submission deadlines for SAF-T in Romania can be monthly/quarterly, annual or on demand by the tax authorities.

Monthly or quarterly: The D406 file, except for the ‘Assets’ and ‘Stocks’ sections, shall be submitted monthly or quarterly by resident taxpayers, depending on the applicable VAT regime. The deadline for submission is the last calendar day of the month following the end of the reporting period.

Annual: The ‘Assets’ section can be submitted autonomously and must be filled annually by resident taxpayers within the deadline for submitting the annual financial statements.

On request: The ‘Stocks’ section shall be submitted only if requested by the tax authorities within the deadline established by that request, which cannot be shorter than 30 days.

Timeline of SAF-T in Romania

Romania’s implementation of SAF-T began on 1 January 2022 but only for a specific category of taxpayers. The following dates are when the SAF-T obligation applies to different types of taxpayers:

  • September 2021: Voluntary test period began
  • 1 January 2022: Large taxpayers included in the tax authority’s list from 2021 must file SAF-T
  • 1 July 2022: Large taxpayers who were not in this category on 1 January 2022 must file SAF-T
  • 1 January 2023: Medium-sized taxpayers, financial institutions and insurance firms categorised as large taxpayers must file SAF-T
  • 1 January 2025: Small taxpayers and non-resident taxpayers registered for VAT in Romania must file SAF-T

Understanding SAF-T D406 in Romania

The SAF-T D406 statement is required to be submitted each month or quarter to the Romanian tax authority (ANAF). The submission frequency is dependent on the company’s VAT regime, and it can either be monthly or quarterly.

There is also an annual SAF-T report under D406 – based on the taxpayer’s financial year – which includes asset information from the previous year, as well as a D406 Stock information report which is to be created based on the ANAF’s request.

The SAF-T file must be submitted electronically, through the tax authorities’ public service “Servicii online – Depunere declarații”​.

Implementing SAF-T as a business

Compliance is important for businesses if they are to avoid fines and other penalties from Romania’s tax authorities. To comply with SAF-T, taxpayers must meet reporting deadlines with relevant and complete information – the use of purpose-built solutions can help with this.

Sovos SAF-T solutions can help your organization save time and effort when ensuring compliance with the mandate. Automating the process of preparing files helps not only with efficiency but also accuracy and compliance, providing peace of mind and freeing up valuable time.

For taxpayers established outside of the EU, complying with Romania’s VAT rules requires the appointment of a fiscal representative should they sell in the country. Sovos can help here too – contact us for more information.

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Other requirements for VAT compliance in Romania

Tax compliance in Romania goes beyond the SAF-T obligation, especially with Romania’s big push into e-invoicing.

The country introduced an e-invoicing requirement for B2B transactions of high-fiscal risk products in December 2021 and followed that up with an obligation for B2G transactions in May 2022. Both were implemented in July 2022.

Romania is aiming to make e-invoicing mandatory for B2B transactions of all types. Following the EU Council’s derogatory decision, allowing Romania to implement mandatory e-invoicing, Romania published a new B2B mandate with a 2024 roll-out date. The new law also introduces a new reporting system that will operate within the first six months of the introduction of the RO e-Factura e-invoicing system in July 2024. Read more in this overview about e-invoicing in Romania or take a look at this overview about VAT compliance in Romania.

Get in touch with our experts if you need help.

FAQ

SAF-T became mandatory for large resident taxpayers in Romania in January 2022, and for medium-sized resident taxpayers in January 2023. Small and non-resident taxpayers will be obligated under the SAF-T mandate in January 2025.

While SAF-T has a similar reporting format across countries, each country as its own mandatory fields. In Romania, three different declarations are submitted by taxpayers: the general D406 file, the D406 Assets and the D406 Stocks.

SAF-T in Romania currently applies to medium-sized and large resident taxpayers. Small and non-resident taxpayers will need to comply with SAF-T from 2025.

Taxpayers who fail to comply with SAF-T in Romania by not submitting the D406 report may be fined by the tax authority. There is a three-month grace period for non-submission in which no fines will be issued, but after the period a fine of 1,000-5,000 RON may be imposed. For an incorrect or incomplete submission, taxpayers may receive a fine of 500-1,500 RON.

The submission deadline for SAF-T in Romania ends on the last day of the month following the reporting period, which is either a month or a quarter for information outside of stocks and assets.The D406 Assets declaration is to be submitted within the deadline for the yearly submission of the taxpayer’s financial statements.

The D406 Stocks declaration is to be submitted on demand, within the deadline prescribed by the Tax Authorities (a minimum 30-day deadline).

Our Solution capabilities for Romania SAF-T

Data Extraction

Painlessly aggregate and consolidate data from a wide range of source systems across General Ledgers, Accounts Receivable, Accounts Payable (for monthly or quarterly submissions), Fixed Assets (for annual submissions) and Inventory (submitted on demand) complying with Romania’s standard tax control file, D406.

More about data extraction

Data Analytics

Check the accuracy, integrity and quality of complex data structures required by Romania SAF-T to give you peace of mind before you submit your D406 file to be audited by the ANAF.

More about data analytics

File Generation

Ensure that all required data sets from accounting entries, sales and purchase transactions, asset depreciation, stock movements and more, are mapped seamlessly into Romania’s D406 schema, ready to be analyzed and submitted punctually to the ANAF.

More about file generation

Get in touch with us

Related resources

VAT Digitization In Eastern Europe

Free ebook including country cards for VAT compliance
Read now

SAF-T International Standards

Your ebook for all things SAF-T
Learn more

European VAT Compliance

An ebook to making VAT compliance simple
Read the ebook

Spain e-invoicing: What you need to know

Spain e-invoicing

Spain is one of many European countries to adopt e-invoicing for taxpayers. With several standards to comply with and additional regional VAT compliance, understanding Spain’s e-invoicing requirements can be complex.

Our regulatory experts break down what you need to know, from specific B2B and B2G standards to required formats. Bookmark this page to stay up to date with the latest e-invoicing requirements in Spain.

Get the information you need

Contents

Table of Contents

Who must use e-invoicing in Spain?

Electronic invoicing in Spain has been mandatory for all transactions between public administrations and their suppliers since 2015.

Businesses are under varying e-invoicing obligations depending on the nature of their transactions. Electronic invoices will soon be mandated for business-to-business (B2B) transactions, whereas business-to-government (B2G) transactions may already qualify for e-invoicing. More information on the specifics of a company’s compliance obligations can be found below.

How does e-invoicing in Spain work?

From an e-invoicing perspective, Spain is a post-audit country. There is not an e-invoice clearance requirement, but Spain has been an early adopter of the CTC method in the EU with the introduction of mandatory near real-time invoice data reporting.

Currently, Spain’s tax authority is transitioning to adopt a mandatory B2B e-invoicing requirement that will significantly affect the country’s e-invoicing process.

Spain B2B E-invoicing

Spain originally planned to launch its B2B e-invoicing mandate in July 2024 but postponed it. As the Spanish government commits to giving a year’s notice before implementing a passed law, businesses can currently expect a 2025 launch for the mandate.

The country is expected to implement B2B e-invoicing in a phased approach, with it initially affecting large taxpayers and all other taxpayers joining them a year later.

Read more on Spain B2B e-invoicing.

Spain B2G e-invoicing

Since 2015, e-invoicing has been mandatory in Spain in the public sector. Law 25/2013 mandates that all invoices sent to public sector entities must be sent electronically and signed with an eSignature. All public entities receive invoices through one common point of entry, namely FACe.

An exception to the rule allows paper invoices to be sent to public administrations if the transaction amount is under 5,000 euros.

Timeline for e-invoicing requirements in Spain

The mandatory B2B electronic invoicing requirement will be effective according to the annual turnover of the taxpayer:

  • Entrepreneurs and professionals whose annual turnover exceeds €8 million will have one year after the regulatory framework is approved
  • For the rest of the entrepreneurs and professionals, the electronic invoicing obligation will take effect two years after the regulatory framework is approved
  • 1 July, 2030: Spanish VAT-registered businesses must comply with VAT in the Digital Age (ViDA) requirements, which include mandatory e-invoicing and digital reporting for Intra-Community B2B transactions.

This timeline will be updated when official implementation dates are announced.

What is the required format for an e-invoice in Spain?

Spain’s approved e-invoicing format for B2G transactions is FacturaE and it follows the XAdES standard and uses XML signatures. The central platform to send e-invoices to public administrations is FACe, though business transactions are to be processed through web service FACeB2B.

E-invoices in Spain must comply with EN 16931 and are required to include set information, including:

  • QR code
  • VAT number
  • Date and time
  • Invoice number
  • Total invoice amount including taxes
  • Unique identification number (Número de Identificación Fiscal or NIF)

The e-invoice issuer must archive the electronic document for a minimum of six years.

Spain - Alcalá

Standards and communications for e-invoicing in Spain

Spain - Toledo

There are several e-invoicing standards in play in Spain, governing how the process is carried out by taxpayers.

The format of e-invoices for B2G transactions must meet set standards, for example. Namely, electronic invoices must follow the FacturaE format – an XML-based national standard that is used in tandem with a secure eSignature which follows the XAdES standard.

Once e-invoicing for B2B transactions comes into effect, the format of e-invoices must comply with the EN 16931 standard. The following will be accepted:

  • EDIFACT invoice messages compliant with ISO 0735
  • UBL Invoice and Credit note messages in accordance with ISO/IEC 19845:2015

In terms of communication for e-invoicing in Spain, FACe is the singular hub for submitting electronic invoices in B2G supplies.

What else is required for full VAT compliance in Spain?

Spain is a notoriously complex country where VAT compliance is concerned. The tax authority has numerous rules in place that businesses need to be aware of to be fully compliant. For an overview read this comprehensive page about VAT compliance in Spain.

Batuz

A tax control strategy implemented by the Bizkaia government, Batuz applies to all companies and self-employed persons who are subject to Bizkaia regulations. This is the case regardless of a taxpayer’s size or volume of operations.

Spain SII

A demanding mandate comprised of an electronic VAT system that affects large companies across Spain. Those who qualify for Spain SII must stay on top of the four-day reporting period.

TicketBai

Only applying to specific taxpayers, TicketBAI is invoicing software that follows set standards in order to ensure the integrity, conservation, traceability and inviolability of records.

IPT in Spain

While not VAT, Insurant Premium Tax (IPT) is still an important tax that companies need to keep in mind.

How Sovos can help

By now, you will be fully aware that tax compliance in Spain isn’t simple for many businesses. You don’t have to do things alone, though – Sovos can help, combining local tax expertise with complete compliance solutions.

Speak with a member of our team today to free yourself up and focus on what truly matters: your business.

Looking for more VAT compliance resources?

Guide to European VAT Compliance

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Blog: Continuous Transaction Controls

Increase your understanding of continuous transaction controls with our blog, written by a Sovos tax expert
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Annual Report: Trends 13th Edition 2022

Read the 13th Edition of Trends, our annual VAT report
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eBook: VAT Digitization in Eastern Europe

A Quick Guide to E-invoicing and Real-Time Reporting
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Looking for direct advice on e-invoicing compliance?

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VAT Compliance in Spain for Businesses

Recent tax updates in Spain:

• B2B e-invoicing draft regulation published
• New invoicing requirements draft regulations
• A quick guide for IPT 

Spain VAT compliance is dense, but it doesn’t have to be hard to achieve. Spanish VAT legislation has been amended numerous times since it was introduced, and there are other regulations organisations need to be aware of too – from SII to e-invoicing.

This is your hub for all things VAT compliance in Spain, covering all mandates and requirements that may apply to your business. Use this page to gain an in-depth understanding of Spanish VAT rules and regulations and how to comply.

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Table of Contents

VAT rules in Spain

Spain is a complex country for VAT rules, with many elements that companies need to be aware of. These include:

SII Spain

An electronic VAT system that affects thousands of large companies across the country. The mandate is demanding, with the impacted groups having to stay on top of the four-day reporting period.
Learn more about SII Spain

Spain e-invoicing

The Spanish government has published a draft regulation with the framework for implementing mandatory B2B e-invoicing. The proposed legislation outlines the operation of the Spanish e-invoicing system. Its main feature is the reliance on the principles of interoperability of e-invoice formats and interconnectivity of e-invoicing platforms.
Learn more about Spain e-invoicing

TicketBAI

Invoicing software that follows specific standards to guarantee the integrity, conservation, traceability and inviolability of records. Specific taxpayers are obliged to use TicketBAI when issuing invoices or supporting documents.
Learn more about TicketBAI invoicing

Batuz

Batuz is a tax control strategy implemented by the Bizkaia government that applies to all companies and self-employed persons subject to the regulations of Bizkaia – regardless of their size and volume of operations.
Learn more about TicketBAI invoicing

IPT in Spain

An additional tax that companies in Spain need to be mindful of is Insurance Premium Tax (IPT). This particular tax can be complex to navigate as it requires correct submission to the five different tax authorities: Alava, Guipuzkoa, Navarra, Statal and Vizcaya. The basis for calculating IPT is the total amount of the premium payable by the insured, excluding funds for the insurance of extraordinary risks and fire brigade tax. Companies must show the tax in addition to the premium.
For more information read on IPT in Spain

Requirements to register for VAT in Spain

Prior to July 2021, foreign sellers were required to be VAT registered if their annual imports into Spain exceeded 35,000 euros. From that date, as per an EU-wide ruling, the threshold was lowered to 10,000 euros. If a company’s annual turnover exceeds that amount, it is liable for VAT in all EU Member States.

Companies that supply goods or services that are subject to VAT in Spain must apply for a domestic VAT ID with their local Administración de la Agencia Estatal de Administración Tributaria (AEAT) branch and appoint a Spanish fiscal representative to communicate with the Spanish tax office on their behalf.

Sovos’ team of experts are specially equipped to handle VAT registration for businesses. Contact us today for further information.

When does VAT liability apply?

In Spain, VAT liability applies to the following types of transactions:

  • Supply of goods or services that takes place in Spain, made by a taxable person
  • Specific intra-community acquisitions (both arrivals and dispatches)
  • Domestic reverse charge
  • Importation

Invoicing requirements in Spain

Spain has strict requirements for the creation, processing and storage of invoices. Invoices must be issued by the 16th of the month following the supply for taxable customers and at the time of the supply for non-taxable customers.

Legislation in Spain declares invoices must include basic details such as:

  • Supplier details
  • Customer details
  • Date of issuance (and date of transaction if they differ)
  • Full description of the goods or services
  • Amount chargeable for goods or services
  • Net taxable supply value
  • Gross amount of the invoice
  • Applied VAT rate(s) and VAT amount per rate

The Spanish government has published a draft regulation with the framework for implementing mandatory B2B e-invoicing. As it is still a draft, taxpayers can expect changes before publication of the final version.

Read our dedicated blog for more information on Spain B2B e-invoicing

Registration for OSS

The EU established the One Stop Shop (OSS) in July 2021, implementing an EU-wide VAT threshold of 10,000 euros and making cross-border online sales in the region simpler. This is part of the EU VAT e-commerce package.

Those registering for the scheme are required to provide specific information to the Member State of identification, and Member states are free to choose how they collect such information electronically.

In addition to OSS, businesses trading in Spain and other EU Member States need to comply with Intrastat. There are country-specific Intrastat thresholds that, once exceeded, require registration and returns for compliance. This system is in place to collect information and produce statistics on the movement of goods between EU Member States.

FAQ VAT compliance Spain

The VAT law in Spain is known as LIVA and has been amended several times so it aligns with EU VAT legislation. Spain does not have a VAT registration threshold, meaning both resident and non-resident taxpayers must register for VAT in the country before they provide taxable supplies.

Typical required information on VAT invoices in Spain include the date of issuance and transaction, supplier’s VAT number, description of goods or services, net value of supply, VAT rate(s) applied and addresses of both the supplier and customer.

The standard VAT rate in Spain is 21%. That said, the country also has zero-rated goods which must be reported on VAT returns – even though no VAT will be charged on the products.

Spain has a reduced VAT rate of 10% for health products, hotels, restaurants, and sports and entertainment activities, and 4% for certain food items, books, magazines and newspapers.

Spain does not have a VAT registration threshold, meaning both resident and non-resident taxpayers must register for VAT in the country before they provide taxable supplies.

How Sovos can help

It should be clear now that VAT compliance in Spain can be a tall, complex task. Future-proof your compliance with Sovos, a single vendor with both global and local tax expertise. 

Contact our expert team today so you can concentrate on growing your business without compliance concerns.

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Important verifications beyond TIN matching

TIN matching typically occurs at two points when paying a vendor or customer: when onboarding a new vendor or customer based on information collected on Form W9 and prior to reporting amounts paid on 1099s to ensure name/TIN information is still accurate. When it comes to onboarding new vendors or customers, there are two additional verifications beyond TIN matching businesses must be aware of. Understanding these verifications can help prevent your organization from working with fraudulent individuals or businesses.

Read more about verifications beyond TIN matching.

Japan's Tax System

Japan's Tax System

Starting with the introduction of a multiple tax rate system in 2019, Japan is in the middle of a multi-year process of upgrading its consumption tax system. Through this significant change, the Japanese government seeks to solve a tax leakage problem that has existed for years.

Get the information you need

Japan's tax reforms

The recent series of tax reforms in Japan started with the introduction of its multiple tax rate system on 1 October 2019. Following this, changes in the country’s indirect tax, the Japanese Consumption Tax (JCT), started to take place. To counter systemic problems caused by the current ledger system structure, anew system – the Qualified Invoice System –will be introduced from 1 October 2023. The key difference from the current system is that a Qualified Invoice must include a breakdown of applicable tax rates for that given transaction.

Not long after these changes were announced, a new organisation, the E-Invoice Promotion Association (EIPA), was established in July 2020. It aims to promote digitization of overall commercial transactions. Leveraging the opportunity presented by the new Qualified Invoice System, the EIPA began to work on developing a standard specification for electronic invoices.

Since January 2021, the EIPA – with support from the Japanese government – has been working with the OpenPEPPOL team to develop a Japanese specification that meets the country’s regulatory framework and business demands. In September 2021, Japan acquired PEPPOL Authority status and aims to allow businesses to issue and receive electronic invoices through PEPPOL in the Autumn of 2022.

Kyoto, Japan springtime in the historic Higashiyama district art dawn.

Japan's tax system quick facts

  • Under the new system, only registered JCT payers can issue qualified tax invoices. On the buyer side, taxpayers will only be eligible to input tax credit where a qualified invoice has been issued
  • Taxpayers must register with Japan’s National Tax Agency (NTA) to issue qualified invoices. Registration began in October 2021 and must be completed before 31 March 2023
  • Invoices must be archived according to Italian-style storage requirements: to be compliant, taxpayers must either timestamp their invoices or draw up a Storage and Maintenance Guideline describing how the invoices are archived and how this meets applicable requirements
  • Invoices should be stored in such a way to guarantee the integrity, authenticity and availability during the storage period
  • Foreign storage is allowed provided it fulfills the requirement for storage under Japanese law
  • Outsourcing of invoice issuance is allowed with no restrictions or requirements

Japan's mandate rollout dates

  • 1 October 2019 – Japan introduces its multiple tax rate system
  • 14 September 2021 – the Japanese Digital Agency obtained PEPPOL Authority status
  • 1 October 2022 –EIPA aims to enable businesses in Japan to issue and receive electronic invoices through PEPPOL
  • 31 March 2023 – Latest date to apply for registration with the NTA to issue qualified invoices
  • 1 October 2023 – Qualified Invoice System will be introduced

Quick facts about Japan's Consumption Tax

Introduced in January 1989, it’s the indirect tax charged on the consumption of goods and services in Japan. There are national and regional levies, and a reduced rate of Consumption Tax in Japan.

Japan’s Consumption Tax is the equivalent of VAT which is charged across the European Union.

Consumption Tax in Japan is levied when a business transfers goods, provides services or imports goods into Japan.

A refund of Consumption Tax in Japan isn’t possible for businesses without taxable sales in the country.

How Sovos can help

As Japan implements its Consumption Tax System updates, requirements for Japanese taxpayers will change. Need help ensuring your business stays compliant with all future Japanese Consumption Tax system updates?

Our experts continually monitor, interpret and codify regulatory changes from around the world into our software, reducing the compliance burden on your tax and IT teams.

Contact Us Today

Serbia E-invoicing

Serbia is in the process of introducing mandatory e-invoicing for all taxpayers

Following other Eastern European Countries such as Poland and Romania, Serbia is on its way to implementing the mandatory e-invoicing system for the B2B (business to business) and B2G (business to government) sectors.

The Law on Electronic Invoicing that came into force in May 2021, introduces the clearance e-invoicing system and presents the centralised continuous transaction controls (CTCs) platform called SEF (Sistem E‑Faktura) for sending, receiving, capturing, processing and storing structured electronic invoices. Additionally, there is a system to help taxpayers with the processing and storage of invoices called the Sistem za Upravljanje Fakturama (SUF).

The new legislation aims to replace paper invoices with electronic invoices and outlines the requirements for the issuance of e-invoices in B2B and B2G transactions.

Have questions? Get in touch with a Sovos Serbia VAT expert.

Scope of e-invoicing mandate

Under the new e-invoicing framework, e-invoices must be sent and received in accordance with Serbian e‑invoicing standards (custom application of the standard EN 16931-1). All e‑invoices must be submitted via a centralised platform to the recipient who must accept or reject the invoice.

  • For invoices relating to B2G transactions: 15 days to accept an invoice, in the case of no response the invoice will be deemed accepted.
  • For invoices relating to B2B transactions: This requirements will come into force in 2023. After 15 days a re-notification is sent, if the buyer does not accept or reject the electronic invoice within five days from the date of re-notification that the electronic invoice has been issued, the electronic invoice shall be deemed rejected

Currently in scope are resident taxpayers in the private and public sector and non-resident businesses with a local fiscal representative in Serbia.

Quick facts

  • Serbian e-invoices must be issued in an XML format and comply with UBL 2.1 Standard
  • Taxpayers must register first via the eID.gov.rs portal to start using the SEF platform, by using either:
    • Qualified Electronic Certificate or
    • Parameters for two-factor authentication
  • Invoices must be sent and received to EN 16931‑1 standard
  • The Ministry of Finance needs to give consent to the service provider, who needs to be registered in Serbia, to provide e-invoicing and archiving
  • Issuing electronic invoices through SEF ensures the integrity and authenticity of the electronic invoice

Mandate rollout dates

May 2021: Law on Electronic Invoicing entered into force

1 May 2022: All suppliers in the public sector must send invoices electronically and the Serbian government must be able to receive and store them. (G2G/B2G)

1 July 2022: Serbian public entities are obliged to send e‑invoices to companies, who must be able to receive and process them. (G2B)

1 January 2023: E‑invoicing will be extended to the entire B2B sector. (B2B)

How can Sovos help?

Need help to ensure your business stays compliant with the emerging mandatory e‑invoicing for all taxpayers in Serbia?

Our experts continually monitor, interpret and codify legal changes into our software, reducing the compliance burden on your tax and IT teams.

Learn how Sovos’ solution to address the changing VAT compliance requirements in Serbia can help companies stay compliant.

Contact Us Today

Indonesia E-invoicing

Indonesia made e-invoicing mandatory for all VAT-registered taxpayers on 1 July 2016, expanding upon its initial e-Faktur rollout in Bali and Java from 1 July 2015.

With its own official e-invoicing system and mandate, Indonesia has plenty for taxpayers to learn and comply with. This page is the ideal starting point for understanding Indonesia e-invoicing.

Table of contents

1. E-invoicing requirements in Indonesia

2. Timeline of e-invoicing adoption in Indonesia

3. Penalties: What happens if I don’t comply with e-invoicing in Indonesia?

4. Setting up e-invoicing in Indonesia with Sovos

5. FAQ

6. Additional resources

E-invoicing requirements in Indonesia

After experiencing challenges in its tax control system, Indonesia adopted an e invoicing system locally known as e Faktur Pajak. Leveraging data reported in real-time via continuous transaction controls (CTCs) allows the Indonesian tax authorities to reduce occurrences of fraud whilst helping to close the tax gap.

Introduced in 2014 and effective from 2016, Indonesia’s e invoicing system seeks to combat the tax gap. Indonesia’s solution was the implementation of an invoice clearance system, where invoices must be approved by the local tax authority prior to being sent to a customer.

E-invoicing is mandatory for all corporate VAT taxpayers. It’s compulsory for all invoices to be processed and issued electronically through the government’s official system, eFaktur.

Also known as tax invoices, e-invoices in Indonesia are typically issued for:

  • Delivery of taxable goods (Barang Kena Pajak)
  • Rendering of taxable services (Jasa Kena Pajak)
  • Advance payment of taxable goods or services

eFaktur e-invoices should be created by applications approved by Indonesia’s Director of Taxation (DGT). Options include client desktop, web-based and host-to-host applications. Electronic invoices need to be secured using an electronic signature, and taxpayers need electronic certificates to verify their identity—the latter need to be renewed every two years. Validated invoices receive a QR code from the DGT as proof of authenticity.

It’s worth noting that the VAT return submission has been integrated with eFaktur, and VAT returns are typically required to be submitted monthly via the platform.

Timeline of e-invoicing adoption in Indonesia

Indonesia’s e-invoicing journey has plenty of key moments:

  • 1 July 2014: e-Faktur is introduced
  • 1 July 2015: e-Faktur becomes mandatory for VAT-registered taxpayers in Bali and Java
  • 1 July 2016: e-Faktur Pajak became effective for all VAT-registered taxpayers based in the country
  • 1 October 2020: New e-Faktur Pajak version 3.0 released
  • 31 July 2024: The development of a Core Tax System (PSIAP) is announced to automate and digitise tax administration services

Penalties: What happens if I don’t comply with e-invoicing in Indonesia?

Indonesia penalises taxpayers who fail to meet their compliance obligations. For example, if a tax invoice is not issued (or is issued late or invalid), the taxpayer will be fined 1% of the VAT base.

FAQ

All VAT-registered businesses in Indonesia must send and receive e-invoices via the e-Faktur platform. They must submit invoices for validation before sending to the buyer.

Issuing e-invoices has been mandatory for corporate taxpayers since 1 July 2016.

No, only validated e-Faktur invoices issued via the DGT platform are legally recognised for tax purposes.

Yes, the e-Faktur system is integrated with VAT reporting. The introduction of e-faktur v3.0 in October 2020 enabled the auto-population of VAT returns for taxpayers in the scope of the local e-invoicing mandate.

Setting up e-invoicing in Indonesia with Sovos

E-invoicing is a global trend, though your requirements differ by country. Indonesia is far into its e-invoicing journey, while some countries have yet to even announce any official plans.

Doing business internationally is tough, especially when you add compliance to the mix. Working with Sovos means choosing a single vendor to handle tax compliance, wherever you operate.

Let us take care of your compliance burden so you can continue to focus on growing your business.

Get in touch with us

Additional resources

Indonesia VAT

Find out more about tax compliance in Indonesia.
Learn more

Asia Pacific E-invoicing

Learn about e-invoicing across the Asia Pacific region.
Read here

E-invoicing Guide

Your ultimate one-stop shop for electronic invoicing.
Learn more

Israel e-invoicing

Israel is set to implement a continuous transaction controls (CTC) model that will require businesses to submit invoice data in electronic format for the tax authority to validate.

The mandate, set to come into force in May 2024, will require invoice data to be validated by the country’s tax authority before being sent to the final recipient. Read on for an overview of Israel e-invoicing requirements – we encourage you to bookmark the page to stay updated as the mandate develops.

Get in touch

Table of contents

1. At a glance: Characteristics of invoicing data submission in Israel

2. Electronic invoicing laws in Israel

3. Benefits of using e-invoicing in Israel

4. Timeline of e-invoicing clearance in Israel

5. What is the future of e-invoicing in Israel?

6. What happens if I don’t comply?

7. Setting up e-invoicing in Israel with Sovos

8. FAQ

9. Additional resources

At a glance: Characteristics of invoicing data submission in Israel

CTC Type 
CTC Clearance

Format 
JSON

Allocation Number 
Assigned by the ITA

 

E-invoicing 
Not mandatory

Electronic Signature 
Not applicable (though needed in case of e-invoicing)

Archiving 
Not applicable

Electronic invoicing laws in Israel

From 5 May 2024, Israel will make clearance CTC clearance mandatory. Authorised dealers (taxpayers) will have to clear invoices above a threshold of NIS 25,000 (before VAT), obtaining an allocation number acquired by the SHAAM – a computer system provided by the Israeli Tax Authority (ITA).

The invoice value threshold will be gradually reduced annually until 2028, ending at NIS 5,000 pre-VAT. Nevertheless, suppliers may report invoice data to the tax authority for clearance and request an allocation number for any amount.

Besides CTC clearance, e-invoicing rules remain in place and do not change with the new CTC requirements. Electronic invoices are still optional.

Since 2019, public entities in Poland have been mandated to receive and process e-invoices. While currently optional for suppliers of public entities, the transmission of e-invoices will be required for B2G and B2B transactions when the mandate is implemented (this was planned for 1 July 2024 until it was postponed in January 2024).

CTC clearance model

Israel’s model will include a clearance system from 5 May 2024. Businesses that exceed a specific threshold will be required to obtain an allocation number for invoices regarding B2B transactions. They can do so by issuing the invoice to the tax authority before sending it to the final customer.

Without receiving this number and including it on invoices, businesses will not be able to deduct input VAT.

Israel B2B e-invoicing

Israeli CTC clearance covers B2B transactions between authorised dealers.

However, e-invoicing is not mandatory under the new CTC clearance system. In case invoices are issued in electronic format (structured or unstructured format, including PDF), they must be cleared by the ITA and assigned with an allocation number before exchanged with the trading party.

Without receiving this number and including it on invoices, businesses will not be able to deduct input VAT.

Benefits of using e-invoicing in Israel

Although CTC Clearance mandate does not require e-invoicing, there are numerous benefits for businesses that electronically issue and receive invoices, including:

  • Cost savings through the reduction of paper, postage and manual labour
  • Saving time by using automated and structured processes
  • Streamlining operations through interoperable, uniformed initiatives and systems
  • Fewer issues and risks through the validation and authentication of data

Timeline of e-invoicing clearance in Israel

While combating fraudulent invoices has been discussed in Israel for a long time, the implementation of the upcoming CTC model is a relatively recent development.

  • February 2023: The 2023-2024 state budget and economic plan are approved, outlining a clearance CTC model
  • June 2023: The ITA announces plan for CTC implementation
  • July 2023: The ITA publishes technical specifications for the upcoming CTC model
  • October 2023: Clearance model is postponed from 1 January 2024
  • 1 January 2024: The original date that the clearance e-invoicing model would be implemented
  • 1 January 2024: The ITA platform becomes operational
  • 5 May 2024: CTC clearance comes into effect
  • January 2025: Invoice threshold lowers to NIS 20,000 pre-VAT
  • January 2026: Invoice threshold lowers to NIS 15,000 pre-VAT
  • January 2027: Invoice threshold lowers to NIS 10,000 pre-VAT
  • January 2028: Invoice threshold lowers to NIS 5,000 pre-VAT

What is the future of e-invoicing in Israel?

While electronic invoice data will be required as part of the CTC initiative, Israel does not yet have a specific electronic invoicing mandate requiring dealers to issue invoices electronically.

Currently, Israel’s e-invoicing rules – which are classified as post-audit – include e-signing, content remarks and prior notification to the tax authority.

Israel has the potential to go the way of countries like Romania and Spain, mandating the use of e-invoices across transactions with governments and businesses. There is no official word on Israel’s future e-invoicing plans beyond the current CTC mandate.

What happens if I don’t comply?

If an allocation number is not requested for the invoice by the supplier, the buyer cannot deduct its VAT based on that invoice.

Setting up e-invoicing in Israel with Sovos

Sovos’ continuous transaction controls (CTC) software was purpose-built to help customers stay on top of their obligations wherever they do business, even as the rules change.

Currently, e-invoicing is permitted in Israel, provided it is prominently stated on the invoice that it is a ‘computerized document’ and prior notification is made to the ITA. A digital signature compliant with the local law is required to ensure the integrity and authenticity of the electronic invoice.

Storage of e-invoices must be within Israel – unless derogation has been granted. Both issuance and storage of e-invoices can be outsourced to third parties like Sovos.

Taxpayers opting to use e-invoices must comply with the abovementioned rules, as well as the CTC clearance requirements rolling out in 2024.

As CTCs and e-invoicing continue to grow in global adoption, it is vital to partner with a provider that closely monitors the decisions of tax administrations and understands the regulations you face. Sovos can help to stay compliant wherever you do business. Get in touch today.

Get in touch with us

Israel CTC Clearance and E-invoicing FAQ

No, e-invoicing is not mandatory in Israel. Israel’s continuous transaction controls (CTC) mandate involves the electronic submission of invoice data and is set to come into effect on 5 May 2024.

Electronic invoice data must include specific information when submitted to the tax authority, including invoice ID, VAT number, invoice date, invoice amount and accounting software number. They also need to be given an allocation number by the ITA for the buyer to use this invoice for a tax deduction, as per the CTC clearance mandate.

Sovos has the first global solution for e-invoicing compliance, including e-reporting functionality.

Within the CTC mandate, the use of emergency allocation numbers is instituted as a contingency measure to address potential failures in its computer systems. In anticipation of such events, taxpayers must acquire and store these emergency numbers.

In case the taxpayer chooses e-invoicing, electronic invoices in Israel must be signed with a digital signature compliant with the local law.

Israel’s mandated CTC clearance platform requires electronic invoice data to be submitted to and approved by the Israeli Tax Authority in real time. The authority will assign an allocation number and verify or reject the invoice data. Once validated, the allocation number will be returned to the seller so it can be issued to the buyer (in electronic or paper format).

Additional resources for e-invoicing compliance

E-Invoicing: A Guide

Use this guide about e-invoicing in Europe to learn more about e-invoicing compliance in general.
Read now

Israel Continuous Transaction Controls (CTCs)

Israel steps closer to introducing a continuous transaction control (CTC) model in its tax system.
Learn the latest

Continuous Transaction Controls Software

Discover how continuous transaction control software can help businesses remain compliant with global tax requirements
Learn more

Lithuania’s VAT Requirements

Lithuania’s SAF-T Standards Framework

Seeking to modernise and digitize its tax systems, the Lithuanian Customs Office of the State Tax Inspectorate announced sweeping changes to its tax system in 2016 with the introduction of the Standard Audit File for Tax (SAF‑T) and the launch of its online portal, eSaskaita.

Have questions? Get in touch with a Sovos Lithuania SAF-T Standards expert.

SAF-T Standards reforms

Implemented with a phased approach, Lithuania’s SAF‑T mandate became mandatory for all taxpayers in 2020. Whilst there is no periodic SAF‑T reporting, businesses must maintain records for the tax authorities in the event they are requested.

Quick facts on SAF-T Standards

  • E-invoices must be accepted provided its integrity and authenticity can be guaranteed from the point of issuance until the end of the storage period.
  • If an invoice is in electronic form, data ensuring its integrity and authenticity must be stored by electronic means.
  • Suppliers may submit documentation by:
    • Using any certified PEPPOL Access Point with an AS4 Profile
    • Manually keying in the invoice information via an online portal
    • Uploading files in XML format (this requires the economic operator’s accounting system to be suitable for storing e-invoices in this format).
SAF-T Standards
SAF-T Standards
  • Service providers to Lithuanian taxable persons not established in an EU Member State must comply with certain additional requirements regarding the outsourcing of e-invoice issuance.
  • The i.MAS, Lithuania’s “Intelligent Tax Administration System,” comprises three main parts:
    • i.SAF reporting of sales and purchase invoices on a monthly basis
    • i.VAZ reporting of transport/consignment documents
    • i.SAF-T accounting transaction report, which is only required when requested by the tax authority.
  • Full SAF-T files are only submitted upon request of the Lithuanian tax authority.

SAF-T mandate rollout dates

  • 1 Oct 2016 – Requirement to submit data on issued and received VAT invoices began
  • 2016 -2019 – Phased rollout of SAF‑T requirements to Lithuanian businesses dependant on revenue
  • Jan 2020 – All businesses required to comply with SAF‑T mandate
  • 2021 – Management and archiving of documents, including invoices, became a licensed activity and must meet certain requirements for integrity, authenticity, security and management to be certified by the Lithuanian Chief Archivist
SAF-T Standards
INFOGRAPHIC

Lithuania’s SAF-T Requirements

Understand more about Lithuania SAF-T including when to comply, submission deadlines, filing requirements and how Sovos can help.

Learn more

How can Sovos help with SAF-T and VAT compliance?

Need help to ensure your business stays compliant with the SAF‑T obligations in Lithuania?

Our experts continually monitor, interpret and codify changes into our software, reducing the compliance burden on your tax and IT teams.

Learn how Sovos’ solution for Lithuanian SAF‑T and other VAT compliance changes can help companies stay compliant.

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Thailand’s New Approach to Electronic Invoicing

New regulations for e-tax invoicing and receipts expected soon.

Thailand’s current e-invoicing legal framework has been in effect since 2012 and follows a post-audit approach.

The Thai Revenue Department and Electronic Transactions Development Agency (ETDA) are working together to improve and further develop the e-tax invoicing system. As a result, new regulations on e-tax invoicing and receipts are expected in the future.

Get in touch with a Sovos Thailand e invoicing expert.

E-tax and electric invoicing solutions

From 2017, the Thai Revenue Department issued regulations on electronic tax invoices and receipts. Subject to approval, taxpayers can prepare, deliver and keep their e-tax invoices and receipts in electronic format. Read more about e-tax in Thailand here.

Quick facts on electronic invoicing

  • E-invoices must be digitally signed using a certificate issued by a certification authority and approved by the Thai Revenue Department.
  • E-invoices must be submitted in XML format to the Revenue Department monthly.
  • Outsourcing of e-invoice issuance is allowed provided the third-party service provider is certified by the Thai Revenue Department.

E-tax invoicing rollout dates

  • 2012 – E-invoicing permitted
  • 2017 – New regulations issued on electronic e-tax and receipts.
  • 2020 – EDTA began a certification process for service providers to assess whether applicants’ solutions are secure and compliant.

How can Sovos help with invoicing solutions?​

Need help to ensure your business stays compliant with emerging e-invoicing obligations?

Our experts continually monitor, interpret and codify legal changes and requirements into our software solutions, taking care of your indirect tax compliance so you can focus on your core business.

Learn how Sovos’ solutions for continuous transaction controls and VAT compliance obligations can help companies stay compliant.

Contact Us Today

Luxembourg VAT Requirements

Luxembourg to implement SAF-T and e-invoicing

Luxembourg is one of many European countries to implement SAF-T and e-invoicing to provide greater visibility into a wide range of business, accounting and tax data.

Luxembourg introduced SAF-T requirements in 2011. In 2019 the country introduced an e-invoicing legislation.

Luxembourg is part of the EU single market economy and falls under the EU VAT regime. The EU issues VAT Directives laying out the principles of how the VAT regime should be adopted by Member States. These Directives take precedent over any local legislation.

VAT law within the country is administered by the Administration de l’Enregistrement et des Domaines and is contained within the General Tax Code.

Have questions? Get in touch with a Sovos Luxembourg VAT compliance expert.

Quick facts on Luxembourg's e-invoicing

  • Just like in any other EU Member State, e-invoicing is permitted in Luxembourg, subject to the buyer accepting the exchange of electronic invoices.

  • Businesses must ensure integrity of invoice content and authenticity of origin for their invoices.  Integrity and authenticity can be proved using Advanced Electronic Signatures, ‘proper EDI’ with an interchange agreement based on the EC 1994 recommendation, and Business Controls-based Audit Trail.

  • In May 2019, Luxembourg adopted legislation about e-invoicing in public procurement following the EU Directive 2014/55/EU. The Directive states that e-invoices will continue to be exchanged voluntarily by suppliers to the government and the centralised PEPPOL access point will continue to be used.

  • Prior authorisation is required before outsourcing to a service provider – written authorisation is recommended.

  • Invoices stored in electronic form must have evidence of their integrity and authenticity stored electronically as well.

  • E-invoices may only be stored in EU Member States (or other countries) of which Luxembourg has signed a mutual tax assistance treaty – prior to notification and access.

  • VAT returns may be filed monthly, quarterly or annually electronically through Luxembourg’s online platform (eCDF) via PDF or XML format. Alternatively, annual filings can be made either in electronic format through the portal or via sending a paper copy of the VAT return to the requisite tax office.

  • To submit tax returns electronically, taxpayers must ensure the service provider they use is certified within eCDF.

Luxembourg’s SAF-T reforms

Officially implemented in 2011, Luxembourg’s Standard Audit File for Tax (SAF-T) is locally known as Fichier Audit Informatisé AED (FAIA).

Businesses must, if requested, submit their financial data electronically in a format that is compliant with AED electronic audit file specifications (i.e., in the specified FAIA format). Only resident businesses subject to the Luxembourg Standard Chart of Accounts must file the FAIA.

Mandate rollout dates for Luxembourg SAF-T and e-invoicing

2011 – Introduction of SAF-T, known as Fichier Audit Informatisé AED (FAIA)

2019 – Adoption of e-invoicing legislation in public procurement with 2014/55/EU Directive

How can Sovos help with VAT compliance?

Need help to ensure your business stays compliant with evolving e-invoicing, reporting and SAF-T obligations in Luxembourg?

Keeping up with VAT compliance obligations has become more difficult as Luxembourg continues to take steps to reduce its VAT gap and modernise the system.

Our experts continually monitor, interpret and codify changes into our software, reducing the compliance burden on your tax and IT teams.

Learn how Sovos’ solutions for changing SAF-T and VAT obligations can help companies stay compliant.

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Slovakia E-invoicing

The modernisation of tax and tax controls remains a high priority for Slovakia’s tax authority. The Slovakian Ministry of Finance plans to introduce a continuous transaction control (CTC) scheme aligned with ViDA to improve the fight against tax evasion and obtain real-time information about underlying business transactions.

Plenty is happening in Slovakia where e-invoicing is concerned, and this page is your ideal overview of the country’s journey towards obligatory electronic invoicing.

Table of contents

1. B2B e-invoicing in Slovakia

2. B2G e-invoicing in Slovakia

3. The use of Peppol in Slovakia

4. Timeline of e-invoicing adoption in Slovakia

5. Setting up e-invoicing in Slovakia with Sovos

6. FAQ

7. Additional resources

B2B e-invoicing in Slovakia

Slovakia has proposed to implement mandatory e-invoicing for B2B transactions from 2027.

The proposal would require taxpayers to issue and receive electronic invoices for domestic, business-to-business transactions. This mandate would use Peppol—the pan-European e-invoicing initiative used by many countries—to facilitate the exchange of e-invoices.

The idea behind implementing Peppol is to enable multiple certified e-invoicing providers to participate, creating a decentralised system.

In addition to mandating the exchange of electronic invoices, the proposal includes real-time reporting of invoice data to the country’s financial administration.

B2G e-invoicing in Slovakia

Slovakia currently requires central, regional and local authorities to be able to receive and process electronic invoices. This has been enforced since 1 August 2019.

E-invoicing is still not fully implemented for business-to-government transactions. However, it is expected that the new CTC regime will cover both B2B and B2G e-invoices.

The use of Peppol in Slovakia

Slovakia’s Financial Administration plans to introduce a mandate for B2B e-invoicing, utilising Peppol’s infrastructure and framework to facilitate document transmission.

The plan of having a decentralised e-invoicing system would allow businesses to exchange e-invoices uniformly and securely and therefore improving operational efficiency.

Also, by joining the Peppol network, the government would allow businesses currently offering e-invoicing solutions in the Slovakia to become Peppol-certified providers, fostering healthy market competition. Slovakia’s Financial Administration will serve as the nation’s Peppol Authority.

Timeline of e-invoicing adoption in Slovakia

Here are the key dates in Slovakia’s journey towards adopting e-invoicing:

  • 19 December 2024: The Ministry of Finance unveils a proposal regarding mandatory e-invoicing and real-time reporting of invoice data to the Financial Administration
  • 1 January 2027: The proposed date of the country’s B2B e-invoicing mandate
  • 1 January 2027: The proposed date of the country’s requirement to report domestic transactions to the tax authorities in real time
  • 1 July, 2030: Slovakian VAT-registered businesses must comply with VAT in the Digital Age (ViDA) requirements, which include mandatory e-invoicing and digital reporting for Intra-Community B2B transactions.

Setting up e-invoicing in Slovakia with Sovos

With Slovakia well on its way to introducing mandates for e-invoicing, it’s important to be ahead of the curve to ensure compliance. However, an evolving e-invoicing landscape isn’t unique to Slovakia.

Chances are that most countries you do business in are undergoing a similar digital transformation. Sovos is a single solutions supplier to ensure your organisation complies with its tax obligations – everywhere you operate.

Choosing Sovos means choosing peace of mind and reclaiming your time.

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FAQ

It is only mandatory for central, regional and local authorities to be able to receive and process e-invoices. Outside of that, Slovakia has no mandate in place for electronic invoicing.

Slovakia is expected to introduce mandatory e-invoicing combined with real-time reporting of invoices to the tax authority.

Currently, the use of Peppol to exchange e-invoices is not mandatory. However, according to the upcoming CTC reform, the Peppol network is planned to be mandatory for the exchange of e-invoices between businesses.

Additional resources

IPT in Slovakia

Ensure you’re aware of all your tax obligations with this blog.
Read here

E-invoicing Guide

Learn about the global rise of electronic invoicing.
Read here

Vietnam’s E-Invoicing Launch

Introducing e-invoicing mandates for VAT in Vietnam.

Over the last 10 years, the Vietnamese government has worked on developing a solution to tackle the country’s VAT fraud and the VAT gap, introducing an e-invoicing mandate for all companies doing business in Vietnam from 1 July 2022.

Have questions? Get in touch with a Sovos Vietnam e-invoicing expert.

Vietnam's E-Invoicing Mandate Rollout - 2022

The Vietnam e-invoicing mandate was initially slated to be in force by July 2020, but ultimately was delayed. In October 2020, a new timeline was laid out through Decree 123 announcing implementation dates for the new e-invoicing mandate rules that were originally envisaged in the Law on Tax Administration.

An initial rollout will begin from March 2022 to a select number of provinces and cities. The country’s new e-invoicing requirements will come into effect nationwide on 1 July 2022.

Quick facts about the new e-invoice processes in Vietnam

  • Applicable taxpayers in Vietnam will be required to issue e-invoices for their transactions from 1 July 2022.
  • Legal framework must be followed for all e-invoice submissions.
  • Enterprises, organisations (economic or otherwise), business households and individuals must register with the local tax administration to start using e-invoicing.
  • There are two types of e-invoicing processes in Vietnam. Authenticated invoices are granted an authentication code by the tax authority before the invoice is transmitted to the buyer, whereas unauthenticated e-invoices do not require the tax authority’s authentication code.
  • Electronic invoices must be issued in XML format.
  • VAT, sales invoices, and the invoices used for selling public assets are among the documents under the scope of the e-invoicing mandate.
  • Ensuring of the integrity and authenticity of the e-invoices is required and must be digitally signed by the supplier.
  • E-invoices must be archived electronically and taxable persons may choose archiving methods guaranteeing security and integrity and authenticity during the entirety of the archiving period.
  • Service providers meeting specific requirements can provide the contracting parties with e-invoicing solutions.

E-invoicing system mandate rollout dates

  • March 2022 – Vietnam General Taxation Department (GTD) will first work with six local tax administrations: Ho Chi Minh City, Hanoi, Binh Dinh, Quang Ning, Hai Phong and Phu Tho to start implementing technical solutions for new e-invoicing requirements and construction of an IT system for connection, data transmission, reception and storage of data.
  • April 2022 – E-invoicing system will be rolled out to the remaining provinces and cities.
  • 1 July 2022 – All cities and provinces must deploy the e-invoicing system based on the rules established in Decree 123 and the Circular that provides guidance and clarification to certain aspects of the new e-invoicing system.

How can Sovos help with VAT compliance?

Need help to ensure your business stays compliant with evolving e-invoicing requirements?

Our experts continually monitor, interpret and codify changes into our software, reducing the compliance burden on your tax and IT teams.

Learn how Sovos’ solutions for continuous transaction controls and VAT compliance obligations can help your company stay compliant.

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Philippines VAT Requirements

There have been improvements in recent years to VAT revenue collection in the Philippines, but there are a considerable number of exemptions from the country’s standard 12% VAT rate.

In addition to periodic VAT filing obligations, the Philippines has launched a Continuous Transaction Controls (CTC) e-reporting pilot program to improve VAT collection. It is also expected to roll out a phased expansion of this VAT control reform to the rest of the economy soon.

This page is your ideal overview for VAT compliance in the Philippines.

Table of contents

1. General VAT information for the Philippines

2. VAT rules in the Philippines

3. Requirements to register for VAT in the Philippines

4. Penalties for non-compliance with VAT in the Philippines

5. Solutions for VAT compliance in the Philippines

6. FAQ

7. Additional resources

General VAT information for the Philippines

Periodic VAT return Monthly: 20th day of the month following the end of the tax period Quarterly: 25th day following the close of each taxable quarter
VAT rates 12% 0% and Exempt

VAT rules in the Philippines

In the Philippines, VAT filings are due monthly or quarterly.

When filing monthly, submissions must be made no later than the 20th day following the end of the taxable month. When filing quarterly, submissions must be made no later than the 25th day following the end of the taxable quarter, aligned with the taxpayer’s income tax quarter.

Requirements to register for VAT in the Philippines

There are several qualifying factors for taxpayers who must register for VAT in the Philippines. These conditions include:

  • Organisations or individuals involved in selling, leasing, exchanging goods or properties and rendering services (if gross sales amount to 3,000,000 PHP)
  • Organisations or individuals who voluntarily register
  • Organisations or individuals that import goods

Penalties for non-compliance with VAT in the Philippines

If you fail to meet your tax obligations in the Philippines, you may be fined 1,000 PHP per instance of failure. However, this can be avoided if the failure is proven to have been caused by reasonable cause and not by neglect.

Taxpayers cannot be charged more than 25,000 PHP in tax-related fines in a year. However, additional penalties, such as surcharges and interest, may also apply depending on the nature of the non-compliance.

Solutions for VAT compliance in the Philippines

Meeting tax obligations in the Philippines may seem complicated, but it doesn’t have to be. Choose Sovos as your compliance partner to save time and gain peace of mind that your requirements are being met.

Sovos combines solutions with regulatory expertise, serving as an extension of your team to make sure you are compliant – not just now, but in the future too. Get in touch today to get started.

Get in touch with us

FAQ

Yes, the Philippines levies Valued Added Tax on goods and services. The standard tax rate is 12%.

Valued Added Taxis calculated on the gross selling price of goods or gross receipts from the sale of services.

Tourists or non-resident passport holders can apply to reclaim VAT in the Philippines on goods bought from an accredited store, if goods are taken out of the country within 60 days of purchase, and goods purchased worth at least 3,000 PHP.

Additional resources

Philippines’ CTC System

Learn about the nation’s e-invoicing system.
Read here

Asia Pacific E-invoicing

Stay on top of tax rules across Asia.
Learn more

China E-Invoicing

China’s VAT digitization journey began nearly two decades ago with the rollout of a tax regime called the Golden Tax System. This created a national taxation platform for reporting and invoicing, as well as legislation regulating the use and legal effect of e-signatures.

With the increase of mobile payment adoption, the push towards customer-facing e-invoicing grows. The Chinese government has taken initiatives to further reform reporting and invoicing with a proposed nationwide e-invoicing service platform to provide an e-invoice issuance service to all taxpayers free of charge.

Table of contents

1. China e-invoicing requirements

2. Format of electronic invoices in China

3. Timeline of e-invoicing adoption in China

4. FAQ

5. Additional resources

China e-invoicing requirements

E-invoicing has been gradually introduced in China, starting with the B2C segment – in some cases by mandating large amounts of taxpayers in the public service sector to issue VAT e-invoices to their customers.

Whilst e-invoicing is not mandatory, it has been widely accepted in B2C instances for several years. It is mandatory in certain core service-based industries, including telecommunications and public transportation. Invoices are issued via the national system, and the hardware and software are certified by the state authority.

A pilot program was launched in September 2020, which enables specific taxpayers operating within China to voluntarily issue VAT special e-invoices. Special invoices are used to claim input VAT and are generally used in B2B transactions.

Format of electronic invoices in China

Electronic invoices take different forms in China. The document is automatically sent to the State Taxation Administration in XML format, and it is returned to the invoice issuer in either PDF or OFD format.

All e-invoices must include a QR code and an electronic signature, buyer and seller information, an invoice number and issuance date, details for the goods or services provided and financial information (unit price, tax rate & amount, etc).

FAQ e-invoicing Germany

Yes, China began its pilot program for electronic invoicing in September 2020 – specifically for B2B transactions in Ningbo, Shijiazhuang and Hangzhou.

Electronic invoicing is not currently mandatory in China, though it is widely accepted by organisations nationwide.

China’s electronic invoicing dictates that these documents must be securely archived for 30 years from their issuance.

Timeline of e-invoicing adoption in China

Learn more about China’s journey to adopting electronic invoicing with the key dates below.

  • September 2020: China’s e-invoicing pilot program began allowing e-invoice issuance for B2B purposes. It initially only included Ningbo, Shijiazhuang and Hangzhou
  • December 2020: Pilot expanded to include Tianjin, Hebei, Shanghai, Jiangsu, Zhejiang, Anhui, Guangdong, Chongqing, Sichuan and Shenzhen
  • January 2021: Pilot further expanded to include Beijing, Shanxi, Inner Mongolia, Liaoning, Jilin, Heilongjiang, Fujian, Jiangxi, Shandong, Henan, Hunan, Guangxi, Hainan Guizhou, Yunnan, Tibet, Shaanxi, Gansu, Qinghai, Ningxia, Xinjiang, Dalian, Xiamen and Qingdao
  • December 2021: A new pilot program, only for selected taxpayers, started in Shanghai, Inner Mongolia and Guangdong, introducing the so-called “fully digitised e-invoice”, a new type of e-invoice that simplifies the e-invoice issuance for both B2B and B2C purposes
  • December 2024: The State Taxation Administration officially recognises e-invoices with the same legal weight as paper invoices

Get in touch with us

Additional resources

Asia Pacific E-invoicing

This blog delves into e-invoicing across the Asia Pacific
Learn more

E-invoicing Guide

Learn more about the current state of electronic invoicing
Read more

Tax in Romania: All you need to know about Romania’s VAT regime

Romania introduces measures to digitally transform its tax administration and close the VAT gap

Seeking to close its VAT gap, the Romanian tax authorities have been discussing the idea of implementing measures to combat the country’s ever-increasing VAT gap. After years of discussion, the country announced its Standard Audit File for Tax (SAF-T) initiative which began in January 2022.

Have questions? Get in touch with a Sovos expert on tax in Romania

Tax in Romania: Romania’s SAF-T reforms

The Organisation for Economic Co-operation and Development (OECD) introduced SAF-T in 2005, and Romania joins a long line of European Member States adopting this form of tax legislation.

From 1 January 2022, companies in the General Directorate for the Administration of Large Taxpayers list must report their VAT electronically to the Romanian tax authorities. Transaction and accounting data must be reported through Declaratiei Informative D406 (SAF-T Romania).

This move is not uncommon and follows the trend being seen across the EU with tax administrations requiring increasingly granular data in real-time in Italy, Spain and Hungary paving the way for pre-populated VAT returns.

For more information see this overview about SAF-T in Romania.

Romania SAF-T quick facts

  • D406 must be submitted electronically in PDF format with an XML attachment and electronic signature. The combined file size must not exceed 500MB for it to be accepted at the portal.
  • Submission deadlines can be periodically, annually or on demand.
  • There is currently a six-month grace period from 1 January 2022.
  • Asset information is expected to be required annually, though no date has officially been announced.

Continuous transactions control (CTC) reforms

The ANAF, Romania’s tax authority, has introduced the RO e-Invoice system. It is optional in the first phase, aiming as a first step at the relationship between companies and the state (B2G) and as a second step, the B2B transactions with high-risk products.

The ultimate goal, as is often the case when a tax administration wants visibility of more data so they can take steps to close their national VAT gap, looks set to be a system that ‘clears’ each supplier invoice prior to it being sent to a buyer.

In this respect, as of 1 July 2022, suppliers will be obliged to use the RO e‑Invoice system in B2B transactions, including high fiscal risk products. Moreover, Romania wants to expand the implementation of e‑invoicing to a broader economy as a next step.

For more information read this overview about e-invoicing in Romania.

Finally, the Ministry of Finance has announced the introduction of a mandatory e-transport system for monitoring certain goods on the national territory from 1 July 2022. The transportation of high-fiscal risk products must be declared in the e-transport system a maximum of three calendar days before the start of the transport, in advance of the movement of goods from one location to another.

The system will generate a unique code (ITU code) following the declaration. This code must accompany the goods being transported in physical or electronic format with the transport document. Competent authorities will verify the declaration and the goods on the transport routes.

Romania CTC quick facts

  • E-invoices must be submitted in XML format.
  • Use of the RO e-Factura system will be mandatory for high-fiscal risk products in B2B transactions from 1 July 2022. High-risk fiscal products include:
    • Vegetables, fruits, roots and edible tubers, other edible plants
    • Alcoholic beverages
    • New constructions
    • Mineral products (natural mineral water, sand and gravel)
    • Clothing and footwear
  • Suppliers of high fiscal risk products must use the RO e-Factura system even if their buyers are not registered with the system.
  • The transportation of high-fiscal risk products must be declared in the e-transport system.

Mandate rollout dates for SAF-T and CTCs

Romania SAF-T

September 2021: Voluntary test period began with D406T allowing taxpayers to become familiar with the data extraction and mapping requirements.

January 2022: Large taxpayers included in the Romanian tax authority’s list in early-2021 must comply with new SAF-T regulations.

1 July 2022: Large taxpayers added to the list in November 2021 must comply with the new SAF-T regulations.

1 January 2023: Medium taxpayers must begin submitting SAF-T data.

1 January 2025: Small taxpayers must begin submitting SAF-T data.

Romania CTC

March 2020: Pilot program launched.

November 2021: Voluntary participation of B2G scheme.

1 April 2022: Voluntary participation of suppliers in B2B transactions including high-fiscal risk products scheme.

1 July 2022: Mandatory e-invoicing for B2B suppliers of high-fiscal risk products and mandatory issuance of e-transport document for the transport of high fiscal risk products.

2023: Mandate expansion to other B2B flows expected.

Infographic

Romania’s SAF-T Requirements

Understand more about Romania SAF-T including when to comply, penalties, requirements and how Sovos can help

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Infographic

Romania CTC Requirements

Understand more about Romania’s CTCs including when businesses need to comply and how Sovos can help.

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How can Sovos help?

Need help to ensure your business stays compliant with the evolving VAT obligations in Romania?

Learn how Sovos’ solutions for SAF-T reforms and e-invoicing VAT compliance can help companies stay compliant.

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Saudi Arabia - E-Invoicing

Saudi Arabia leads the way to continuous transaction controls in the Gulf

Saudi Arabia e-invoicing from December 2021

Saudi Arabia introduced an e-invoicing regime with a phased approach in December 2021. Having only introduced VAT on 1 January 2018, the country is already leading the way in digitizing tax compliance in the Gulf Region.

According to the finalised rules published by Saudi Arabia’s tax authority, Zakat, Tax and Customs Authority (ZATCA) the go-live date of the second phase is 1 January 2023.

In addition to other requirements, Phase 2 also introduced integration with a digital ZATCA platform for continuous transaction controls (CTCs), requiring taxpayers to clear invoices ahead of transmission to buyers.

Get the information you need

Mandate quick facts

Phase 1 – Mandatory e-invoicing generation with post audit controls: Started on 4 December 2021

  • Applies to all resident taxable persons in Saudi Arabia.
  • Requires taxpayers to generate, amend and store e-invoices and electronic notes (credit and debit notes) across B2B, B2C and B2G transactions, including exports.
  • Businesses must generate e-invoices and their associated notes in a structured electronic format.
  • Electronic invoices and notes must contain all necessary information.
  • Any structured electronic format permitted.
  • B2C invoices must include a QR code.
  • All invoices must contain a time stamp.
  • Integrity of e-invoices is explicitly required.

  • Storage requirements same in both Phases 1 and 2. Documents can be stored on Cloud, a direct link to the online data must be available. In case the storage is outsourced, documents must be kept by a third party established within the territory of Saudi Arabia.

  • Suppliers must store e-invoices in a structured format regardless of how they’re exchanged with buyers.

  • Certain prohibited functionalities for e-invoicing solutions.

Phase 2 – CTC regime: Started on 1 January 2023, requiring taxpayers to transmit e-invoices in addition to electronic notes to tax authority ZATCA for clearance

  • A phased implementation approach based on taxpayers’ revenue.
  • Voluntary participation in Phase 2 before the taxpayer’s enforcement date arrives.
  • B2B invoices operate under a clearance regime, while B2C invoices must be reported on ZATCA’s platform within 24 hours of issuance.
  • All e-invoices must be issued in the mandatory XML format.
  • Tax invoices can be sent in XML or PDF/A-3 (with embedded XML) to buyers. B2C invoices must be presented in paper form. However, based on mutual agreement by the parties, B2C invoices can be shared electronically or through any other way where the buyer can read it.
  • A compliant e-invoicing solution must have the following features:
    • Generation of a universally unique identified (UUID) plus invoice sequential number.
    • Tamper-resistant invoice counter.
    • Some ability to save and archive e-invoices and electronic notes.
    • Generation of a cryptographic stamp for B2C invoices, a hash, and a QR code for each e-invoice and electronic note.

Important dates for e-invoicing in Saudi Arabia

Phase 1: 4 December 2021 – All resident taxable persons in the Kingdom to generate, amend and store e-invoices and electronic notes (credit and debit notes).

Phase 2: 1 January 2023 – Additional requirements for taxable persons to transmit e-invoices and electronic notes to the ZATCA. It will be a phased adoption starting with larger companies, with more gradually coming into the scope of the mandate. Companies can expect six months’ notice before the deadline by which they must comply.

Infographic

Saudi Arabia CTC Requirements

Understand more about Saudi Arabia’s continuous transaction controls including when businesses need to comply, phase one and two compliance and how Sovos can help.

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How Sovos can help

Need help to ensure your business is VAT compliant in Saudi Arabia? Sovos serves as a true one-stop-shop for managing all e-invoicing compliance obligations in Saudi Arabia and across the globe. Sovos uniquely combines local expertise with a seamless, global customer experience.

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