The Spanish government has published the much-anticipated 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. The goal is to promote digitalization (particularly for smaller companies), reduce late invoice payments and save on administrative costs such as the management of invoices.
The draft Royal Decree provides further details to the Law for Creation and Growth of companies published in September 2022, which initially establishes the e-invoicing obligation for companies and professionals.
Scope of the Spanish B2B e-invoicing mandate
All companies and professionals required to issue invoices under Spanish law will be obliged to do so electronically. This applies to B2B operations with a few excluded transactions, such as: when issuing a simplified invoice, issuing an invoice voluntarily when there is no such obligation to do so under Spanish rules and in other cases that the government may regulate in the future.
However, the obligation does not apply if one of the parties to the transaction does not have an established business, a fixed establishment or habitual business residence in Spanish territory where invoices are directly issued.
Main requirements of the Spanish e-invoicing system
The Spanish e-invoicing system will consist of privately owned electronic invoicing platforms and the public electronic invoicing solution managed by the State Tax Administration Agency. Taxpayers under scope must send and receive e-invoices through one of these two means and will be able to use both in parallel.
Other important characteristics and requirements of this system are:
- E-invoices can be issued in different accepted formats.
- Regardless of the chosen method, issuers must send an exact copy of each e-invoice to the public e-invoicing solution, in the Facturae format, which will serve as a central repository.
- Application of an advanced electronic signature on e-invoices transmitted via a private platform will be mandatory to ensure integrity and authenticity (I&A).
- All e-invoices must be identified with a unique code.
- The invoice recipient must report e-invoice acceptance or refusal and the effective payment date.
- There are minimum requirements for operating as a private e-invoice platform, such as a proven capacity to connect with the public e-invoicing solution, providing free interconnection and interoperability with other platforms.
- Private e-invoice platform operators will be obligated to interconnect with any other private platform within the Spanish e-invoicing system within one month of their request.
- The public e-invoicing solution will be deemed as the default exchange system for taxpayers who do not explicitly choose to receive e-invoices through a private platform.
Accepted e-invoice formats
The proposed Royal Decree defines an e-invoice as a structured document, which means that a PDF will no longer be considered an electronic invoice. Taxpayers will be required to issue e-invoices using one of the accepted formats:
- XML CEFACT/ONU as specified in the XML schemas 16B (SCRDM – CII)
- UBL as defined in the ISO/IEC 19845:2015 standard
- EDIFACT per the ISO 9735 standard
- Facturae, in the version for invoicing between entrepreneurs and professionals in force at any given time
Additionally, in line with the principle of interoperability, private e-invoicing platforms must be able to convert e-invoices into all supported formats while preserving I&A.
Communication of e-invoice status
The invoice recipient must communicate the e-invoice status to the invoice issuer within the maximum deadline of four calendar days counted from the date of the reported status.
Mandatory statuses comprise the following:
- a) Commercial Acceptance or Rejection of the invoice and its date
- b) Full effective payment of the invoice and its date
Additionally, the draft regulation establishes optional statuses:
- c) Partial commercial acceptance or rejection of the invoice and its date
- d) Partial payment of the invoice, amount paid, and its date
- e) Assignment of the invoice to a third party for collection or payment, with identification of the assignee and the date of assignment
Implementation timelines
The Royal Decree is currently in draft form but will be effective 12 months after its official publication on the Spanish Official Gazette (BOE). Following the Law for Creation and Growth of companies, the 12-month-timeline will apply to entrepreneurs and professionals whose annual turnover is over €8 million, and for the remaining taxpayers under scope the deadline is 24 months.
In the first year from the regulation’s effective date, companies under the e-invoicing obligation must attach a PDF file to the legal e-invoice to ensure readability to counterparties not yet in scope – unless the recipient agrees to receive it in the original format.
The obligation to report the e-invoice statuses will come into effect 36 months after the publication of the Royal Decree for entrepreneurs with an annual turnover below €6 million and 48 months after the publication of the Royal Decree for professionals below the same threshold.
Further details are expected concerning how taxpayers under the SII (Suministro Imediato de Información) mandate must inform the mandatory e-invoice statuses.
What’s next?
As this is still a draft and certain details remain to be established, taxpayers can expect changes before publication of the final version. Additionally, until 10 July 2023, the draft regulation is open for comments from the general public.
Another important note is that the entry into force of this draft Royal Decree is subject to Spain obtaining derogation from Articles 218 and 232 of the EU VAT Directive before the EU Commission. Although this is a formal step and there is no indication that the Commission would not grant the derogation, until it happens the new Spanish rules cannot enter into force.
Looking for further information on e-invoicing in Spain? Contact our expert team.
For an overview about other VAT-related requirements in Spain read this comprehensive page about VAT compliance in Spain.
