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.

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.

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

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.

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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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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 Sovos can help with tax in Romania

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

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

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.

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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.

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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.

The VAT Import One Stop Shop (IOSS)

Simplify EU VAT with IOSS in one single return

The Import One Stop Shop (IOSS) is here. Simplify your EU VAT compliance into a single VAT return – grow your sales in the EU, avoid fines and penalties and enhance the customer experience by removing unexpected fees for buyers.

Since its launch, we’ve been helping e-commerce businesses of all sizes make the switch to the new scheme. Our IOSS service provides you full access to our VAT compliance software solutions and a team of indirect tax specialists. Let us handle the initial registration, monthly filing and intermediary requirements so you can continue to focus on what you do best.

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What is IOSS?

Since July 2021, all goods imported into the EU, regardless of value, are subject to VAT. As of the same date, businesses selling imported goods valued at less than EUR 150 can now use IOSS to collect, declare and pay VAT to the local tax authorities in a single VAT return. IOSS simplifies your EU VAT compliance – unlock the full potential of the EU e-commerce market, maximise your cash flow, and provide an excellent customer service.

In order to obtain a registration, non- EU businesses need to appoint an intermediary. They can then obtain an IOSS VAT registration number in the Member State where the intermediary is established.

Full IOSS service

Let us handle the registration process, obtain a VAT number for your business and file the monthly IOSS returns. All included, no hidden fees.

We act as your IOSS Intermediary

Non-EU businesses can only register for the scheme through an intermediary. We can act as your intermediary for you.

What are the benefits?

Goods move through customs faster – IOSS calculates and accounts for VAT ahead of time instead of applying upon import
With an IOSS VAT registration number, the VAT is accounted for at the point of sale
Reduced charges for customs clearance – without an IOSS VAT registration, import VAT will be due when the goods are cleared in the EU and there are likely to be higher customs clearance costs

Quick Facts

The IOSS simplification is available to use now for any qualifying transactions
The scheme requires additional record-keeping: businesses must retain more detailed records of transactions than previously
IOSS VAT declarations are monthly
Businesses can correct previous IOSS VAT returns in the next one
Non-EU businesses may need to appoint an intermediary and obtain an IOSS VAT registration in the intermediary’s country of establishment in the EU

Depending on the nature of business activity/supply chains, non-EU retailers may need to report under the Union One Stop Shop (OSS) and non-Union OSS schemes.
Businesses need at least one ‘standard’ VAT registration and possibly more due to warehouses or similar if they are to use Union OSS. No other VAT registrations is needed for IOSS or non-Union OSS.

Penalties and Fines

Local tax authorities can issue penalties and fines to businesses if returns and payments are not submitted on time. In addition, repeated noncompliance can lead to a two-year exclusion from the scheme. Businesses would then need to register for VAT in all Member States where they import goods or have alternative arrangements in place to deal with the import VAT.

Businesses that want to use IOSS may require an intermediary. If an intermediary is required you can’t do it alone. Our comprehensive service handles all your registration, filing and intermediary requirements.

It’s time to get EU VAT compliance right with IOSS and Sovos

Our IOSS service gives you full access to our team of indirect tax specialists and VAT compliance software. Let us handle the initial registration, monthly filing and intermediary requirements so you can focus on what you do best.

Portugal’s VAT Regime

Portugal pushes further ahead with VAT digitization

Back in 2019, Portugal passed a mini e-invoicing reform consolidating the country’s framework around SAF-T reporting and certified billing software.

Since then, a lot has happened: non-resident companies were brought into the scope of e-invoicing requirements, deadlines were postponed due to Covid, and new regulations have been published.

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Quick facts

Use of certified billing software is mandatory for the creation of all types of invoices (paper or electronic); this is understood to be the taxpayer’s ERP system. Non-resident companies with a Portuguese VAT registration have also become obligated to issue invoices and other fiscally relevant documents via a certified billing software, since 2021.
A QR code should be included in all invoices issued through a certified billing software. Technical specifications about the content and placement of the code in the invoice are available on the tax authority’s website.
A unique ID number (ATCUD) must be included in all invoices and fiscally relevant documents. The ATCUD is a number with the following format ‘ATCUD:Validation Code-Sequential number’.
Public entities must receive e-invoices whilst companies must send e-invoices since 1 July 2021. E-invoices must be issued electronically in the CIUS-PT format and transmitted to the public administration through one of the available web services.
A qualified electronic signature or seal, or the use of EDI with contracted security measures is mandatory for all electronic invoices from 1 January 2024.
Billing SAF-T has monthly submission requirements and must be completed with the normal VAT return by the 5^th (until the 8th during the year of 2023 due to a grace period) day of the month following the reporting period. The Billing SAF-T may be submitted via the e-fatura portal or through web services.
Accounting SAF-T: annual submission is mandatory from 2026 via the tax authority´s portal which will enable automatic pre-filling of the VAT IES´ Annexes.

Important dates

1 July 2021: Non-resident taxpayers required to use a certified billing software to issue invoices and other fiscally relevant documents.
Issuance of B2G e-invoices:
1 January 2021: Phased rollout of mandatory issuance of e-invoices in the CIUS-PT format for large suppliers of the public administration.
1 January 2022: QR code requirement implemented for invoices and other fiscally relevant documents issued through a certified billing software.
1 January 2023: Unique ID number (ATCUD) is mandatory on all paper and electronic invoices.
1 January 2023: Non-resident taxpayers required to submit Billing SAF-T monthly.
2025 fiscal year: Mandatory annual submission of accounting SAF-T for residents and non-residents (first submission occurs in 2026 regarding the fiscal year of 2025)
1 January 2025: Mandatory B2G E-invoicing extended to include small and medium-sized businesses.
1 January 2025: Qualified electronic signature/seal or EDI mandatory for electronic invoices.

Need help to ensure your business is VAT compliant in Portugal?

Sovos provides a complete VAT, SAF-T and B2G compliance solution for Portugal helping customers meet the demands of the digital transformation of tax and public procurement through a single provider. Sovos uniquely combines local expertise with a seamless, global customer experience.

E-Invoicing India: All You Need to Know

India E-Invoicing Requirements

Under the new Goods and Services Tax (GST) framework, the Indian e-invoicing system falls under the category of continuous transaction controls (CTCs). The invoice data reporting obligation to the governmental portal is a mandatory step before an invoice can be issued.

The legal validity of the invoice is conditional on the Invoice Registration Portal (IRP) digitally signing the invoice and providing an Invoice Registration Number (IRN). If the IRN is not included in an invoice, the invoice will not be legally valid.

The scope covers both domestic and cross-border transactions. The IRP process is mandatory for B2B, B2G and export transactions. So, taxpayers in scope must issue their invoices (as well as other documents that need an IRN e.g. associated eWaybills) according to the new system for all B2B, B2G or export transactions. India has made multiple changes to the initial regulation and future changes are inevitable.

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

India’s e-invoicing mandate

Invoice data should be transmitted to the IRP in JSON format.
The IRN obtained from the IRP is a validity requirement for invoices.
Invoices can be exchanged in JSON or PDF format as well as in paper form between the supplier and buyer.
Archiving is mandated (storage period of eight years).

Mandate Rollout Dates

1 January 2020: Voluntary period for businesses with a turnover of Rs.500 Crore or more.
1 February 2020: Voluntary period for businesses with a turnover of Rs.100 Crore or more.
1 October 2020: Beginning of the mandatory period for businesses with a turnover of Rs.500 Crore or more (six months later than previously intended). For the first 30 days, there was a grace period during which invoices could be reported after they had been issued.
1 January 2021: Beginning of the mandatory period for businesses with a turnover of Rs.100 Crore or more.
1 April 2021: Threshold for mandatory e-invoicing lowered to taxpayers with turnover between Rs. 100 Crore to Rs. 50 Crore.
1 April 2022: Threshold lowered from Rs. 50 Crore to Rs. 20 Crore. Taxpayers above Rs. 20 Crore must implement e-invoicing.
1 October 2022: Threshold lowered to taxpayers with an annual threshold of Rs. 10 Crore.
1 August 2023: Threshold lowered to taxpayers with an annual threshold of Rs. 5 Crore.

Penalties

If an invoice is not registered on the IRP, it will be considered unissued and will result in penalties of at least 10,000 Rupees for each instance of noncompliance. Penalties under various sections of GST will be levied with interest.

Sovos Helps Companies Stay Compliant with India E-invoicing

By February 2021 the initial specifications published by the Indian tax authority in December 2019 had already been revised three times. Future changes are inevitable.

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

Find out how Sovos can help you to meet your clearance e-invoicing obligations in India.

Greece myDATA: All You Need To Know

Greece's myDATA scheme

Greece introduced a new Continuous Transaction Controls (CTC) scheme, myDATA – an eAccounting system with eReporting elements, that requires taxpayers to transmit transactional and accounting data to the tax administration, in real-time or periodically, which populates a set of online ledgers maintained on the government portal. With taxpayers transmitting transaction data to the government portal myDATA system brings Greece in line with the global trend towards CTCs.

Have questions? Get in touch with a Sovos Greece myDATA expert.

Greece's mandate

The myDATA scheme applies to Greek taxpayers obligated by law to keep their accounting records as per the Greek Accounting Standards. It covers B2B, B2G, and B2C transactions.
myDATA eBooks record: a summary of income and expense transactions, classifications of transactions, accounting adjustments which aim to provide a comprehensive overview of the taxpayer’s accounting and tax results.
When businesses file their tax returns, the data declared in them will be reconciled against the data in the eBooks.
A discrepancy between the eBooks and the tax returns triggers a two-phased reconciliation process whereby the taxpayer should correct the resulting difference, otherwise audits or penalties will be incurred.

Mandate Rollout Dates

1 October 2020: Go-live of voluntary reporting of income and expense as well as classifications through all reporting methods (except for reporting through e-invoicing vendors was enacted on 20 July 2020).
1 October 2021: Go-live mandatory phase 1 of myDATA for revenue and certain taxpayers.
1 November 2021: Go-live mandatory phase of myDATA for revenue and all taxpayers.
1 January 2024: Go-live mandatory phase of myDATA for all data in scope.

For the latest deadline changes, follow our Greece myDATA blog for updates.

Penalties

Failure to achieve consistency between the data registered in the eBooks and the reported data in the tax returns triggers penalties or tax audits. Secondary legislation with details on the penalties is expected.

Sovos helps companies stay compliant with Greece’s myDATA

Sovos serves as a true one-stop-shop for managing all CTC compliance obligations in Greece and across the globe. Sovos uniquely combines local excellence with a seamless, global customer experience.

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South Korea's Long Standing e-Tax Invoice System

South Korea E-Invoices

South Korea introduced its Electronic Tax Invoice System i.e. e-Tax in 2010. Since 2011, this has become a mandatory e-invoicing requirement alongside the obligation to report e-tax invoices shortly after issuance. This requirement means South Korea has a continuous transaction controls (CTCs) reporting obligation. The scope of the mandate has been expanded to cover more taxpayers, however the initial workflows and requirements of the mandate have remained relatively stable.

E-invoicing in South Korea has been mandatory for all corporations since 2011 and for individual taxable persons when exceeding a certain turnover threshold.

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Mandate quick facts

Mandatory e-invoicing with CTC reporting model: An issued e-tax invoice must be transmitted to the National Tax Service (NTS) within one day of the invoice being issued
Invoice data is reported to the NTS in XML format
Invoices and amended invoices (credit and debit notes) are in scope
E-invoicing in South Korea applies to domestic transactions only. Cross border transactions are out of scope

Mandate rollout dates

January 2011: The electronic issuance of VAT invoices and next day reporting became mandatory for all Korean corporate taxpayers
January 2012: : In addition to the first category, sole proprietors with a supply value of 1 billion KRW and above must issue e-tax invoices
July 2014: The threshold changed from 1 billion KRW to 0.3 billion KRW and above
July 2019: Introduction of the tax-free portion of the income to be included when calculating the threshold of 0.3 billion KRW
July 2022: The threshold was updated from 0.3 billion KRW to 0.2 billon KRW and above
July 2023: The threshold will be updated from 0.2 billion KRW to 0.1 billon KRW and above

Penalties

Penalties vary between 0.3-1% of the supply price based on the failure type e.g. non-issuance, issuance form, delayed issuance, non-transmission, late transmission.

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South Korea CTC Requirements

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Good to Know

Does South Korea charge VAT?

Yes, VAT is South Korea’s consumption tax and is charged on virtually everything sold throughout the country.

Is e-invoicing mandatory in South Korea?

Yes, e-invoicing in South Korea is mandatory for all corporations and for certain individuals with supplies over a certain amount.

How does VAT work in South Korea?

VAT is charged on all supplies of goods and services. There are some exemptions and also zero-rated supplies of goods and services.

Which countries in Asia require e-invoicing?

Here’s further information about some of the countries within Asia that require e-invoicing.

How Sovos can help

As countries around the globe digitize their tax systems to close VAT gaps, our experts continually monitor, interpret and codify these changes into our software, reducing the compliance burden on your tax and IT teams.

Discover how the Sovos solution is tailored to manage all e-invoicing and related VAT obligations in South Korea.

Mexican electronic invoicing system

Mexico's electronic invoicing requirements:

Mexico has one of the most sophisticated electronic invoicing systems in Latin America. Known locally as Comprobante Fiscal Digital por Internet, or simply CFDI, it was established in 2011, when it replaced the CFD or Comprobante Fiscal Digital. The difference between these two types of receipts/certificates that replaced the paper invoice is that the CFDI requires validation by an Authorized Certification Provider, also known as PAC. In some cases such validation can be done directly with the Tax Administration Service (SAT).

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

Types of tax certificates

Mexico’s electronic invoice system contains multiple types of tax certificates. Among the main ones are:

Income receipt: issued mainly in sales transactions for which some type of income is received in cash, check or any other form, generally for sales of goods and services, but also in case of donations and fees.

Proof of expenditure: this type of tax certificate is issued in cases where the company pays or returns money as a result of refunds, bonuses, discounts, or total cancellation of an income voucher. These are equivalent to credit notes.

Transfer certificate: these are used to justify the legitimate acquisition or possession of the goods that need to be transferred. These CFDI are used as a transportation contract when a company provides transportation of goods to the owner of the goods.

Certificate of payment receipts: these receipts are issued whenever a payment is received on a date other than that on which the transaction is made and the CFDI is generated. Their main function is to document the collection of a total or partial payment. Therefore, they are used for total payments (single payment), partial payments or credit payments received after the original CFDI has been issued. They contain a complemento de pagos (payment supplement). The Mexican VAT system uses cash accounting, which means that companies only pay VAT on the payments they receive immediately for their taxable sales. However, the electronic invoices that sellers provide to SAT include information on all sales, whether paid in cash, on credit or through deferred payments. That means that the number of invoices for a given month may not match the amount of VAT reported to SAT if sellers have received credit payments or have accepted late payments from previous transactions. The payment receipt add-on closes the information gap between the number of payments received and the number of transactions in a given period.

Withholding and payment information certificates: these are used to report on tax withholdings applied at the time of making payments for which a withholding certificate must be issued. This type of certificate also applies when withholdings are made for payments abroad, royalties, sale of shares, dividends, or distributed profits, among others.

Related certificates: these are tax certificates that are related to other previously issued certificates of the same type. They are necessary, for example, when a credit note is issued due to an error in its content, or when a transfer CFDI is issued for merchandise that has already been paid for and for which it is necessary to include a reference to the original CFDI.

CFDI Supplements: In addition to the types of invoices or CFDIs mentioned above, Mexican tax legislation requires that when certain transactions are carried out, additional information must be provided, specifying the type of transaction in question. This type of additional information is contained in the so-called “complementos”, which are attached to the original CFDI. The main complements of the invoices or CFDI are the following:

Airlines
Proof of destruction
Foreign trade
CFDI Tax Registry
Purchase and sale of foreign currency
Fuel consumption
Donations
Fuels statement of electronic purses
Complement of Hydrocarbons

INE
Private educational institutions
Tax captions
Notary public
Works of art and antiques
Other duties and taxes
Payment in kind
Individual member of a coordinated group
Receipt of payments
Payroll payment receipt

Vehicle refurbishment and replacement
Retail sector (Retailer)
Partial construction services
Third party to third party SPEI
Digital tax stamp
Foreign tourist passenger
Food vouchers
Used vehicle
Sale of vehicles

In other cases, the requirement to issue a supplement to the CFDI is due to withholdings made at the time of making payments for specific transactions. These supplements are the following:

Disposal of shares
Dividends
Interests
Leasing

Payments to foreigners
Prizes
Non-business trusts
Retirement plans

Mortgage interest
Derivative transactions
Financial sector

Essential Components

Both the Tax Code (Código Fiscal) and the current Miscellaneous Tax Resolution (Resolución Miscelánea Fiscal, RMF) establish a series of essential conditions with which CFDIs must comply. Annex 20 of the RMF details the technical requirements with which CFDIs must comply, both in terms of content and format, as well as syntax. In terms of content, we detail some of the most essential components for income CFDIs:

Header: used to identify the issuer, its RFC, tax regime, date, and place from which the CFDI is issued, folio or UUID assigned, SAT digital seal, information on the receiver, RFC, etc. In the case of transactions with the general public, a generic RFC must be provided.
Item detail: description by code of the goods and services sold, quantity, unit of measurement, etc.
Form and method of payment: you must choose from a catalogue, informing whether payment is in cash, check or some other method, as well as whether it is in a single payment or in installments or deferred.
Value consigned: includes the value for each good or service detailed in numerical format.
Commissions and other charges: mandatory field for invoice settlements.
Discounts and surcharges: identify total discounts or surcharges.
Informative subtotals: optional fields to report subtotals.
Type of payment made: a) one-time payment (cash); b) payment in installments; c) other form of payment.
Reference information: identifies the documents associated with the issued.
SAT digital stamp.
Signature with a valid advanced electronic signature certificate.
Date and time of the electronic signature.

In the case of the printed representation of the CFDI, it must comply with certain minimum conditions established by the Tax Code and the RMF.

Two-dimensional barcode or QR generated according to the technical specification established in item I.D. of Annex 20 or the fiscal folio number of the receipt
Serial number of the issuer’s and SAT’s Digital Seal Certificate
The caption: ‘This document is a printed representation of a CFDI’
Date and time of issuance and certification of the CFDI
Original string of the digital certification complement of SAT

It is important to point out that the requirements indicated above apply to CFDIs de ingresos (income CFDI). Other CFDIs issued on transfer, payment, payroll, expenses or related, contain other additional requirements or substitutes for the above. Likewise, there are other optional requirements depending on the type of good sold OR service. For example, in the case of sales of vehicles, foreign currency sold by exchange houses, donations or disbursements on behalf of third parties, additional information to those indicated above will be required in the CFDI issued.

Processes

Validation

In order for a CFDI to be legitimate, it must be duly validated before the SAT or by the Authorized Certification Providers (PACs) before being sent to its recipient. For this validation process to be possible, the CFDI must comply with the essential format conditions defined in Annex 20 above:

a) The generated XML file must comply with the technical conditions of format and syntax established in the Miscellaneous Tax Resolution and its technical annexes.
b) Said CFDI must pass the validation rules established for the content and format of the XML file generated.
c) In case the CFDI contains additional supplements required according to the type of transaction or parties involved, such attachments must also comply with the validation rules established by law and the RMF. All this requires that the electronic file of the CFDI is duly referenced to the XSD scheme specified according to the path published by the SAT.

In general, CFDI validations are not performed directly by the SAT (with few exceptions), but by PACs. A PAC is the legal entity authorized by the Tax Administration Service to review the integrity of the XML file, ensuring that it complies with the current technological standard defined by the SAT. In addition, it is obliged to send the authority a copy of the CFDIs validated by its clients. Once the corresponding validations have been performed, the PAC will assign the corresponding fiscal folio -also known as UUID- and will stamp or certify the XML file, thus converting it into a digital invoice. This process is always done electronically and 100% digitally.

Tax Mailbox

The fiscal mailbox is a digital messaging system installed in the SAT’s web portal, through which the SAT communicates with taxpayers and taxpayers must use to communicate with each other, especially in matters related to invoices received and issued. The notification, acceptance, or rejection of the cancellation of the CFDI by other means is not valid for tax purposes in Mexico. Acceptance may be express or tacit.

CFDI Cancellation

The CFDI cancellation process is currently regulated by the Rules of the Miscellaneous Tax Resolution and Article 29A of the Mexican Tax Code, which provides two basic processes for the cancellation of a CFDI: one that requires the authorization of the invoice recipient through the fiscal mailbox (tax mailbox) and one that does not. The cancellation can be made no later than the last day on which the income tax return must be filed.

By default, the recipient of an invoice is required to accept its cancellation for it to proceed; however, according to Rule 2.7.1.35 of the Miscellaneous Tax Resolution, there are twelve cases in which exceptionally the acceptance of the counterparty will not be necessary:

The amount of the invoiced transaction does not exceed MX$1,000.00
The sales are to final consumers
The sales are to residents abroad
Payroll
For expenses (credit note)
For concept of transfer
When the CFDI to be cancelled contains withholdings and payment information
When the cancellation is made within the following business day
Por concepto de ingresos expedidos a contribuyentes del RIF (actualmente RESICO)
For income issued to RIF taxpayers (currently RESICO)
When the CFDI is issued by governmental organizations
In the case of certain CFDIs of income issued for agricultural activities and others

As of January 2022, when the CFDI must be cancelled, the cause of cancellation must be indicated in the cancellation request. These causes of cancellation are the following:

Receipts issued with related errors.
Receipts issued with unrelated errors.

The operation was not carried out.
Nominative operation related to a global invoice.

When the purpose of the cancellation of the CFDI is to replace it with a new one, the new CFDI must make reference to the cancelled CFDI and vice versa.

It should be noted that according to the current Tax Code, the CFDI may only be cancelled in the same year in which they are issued. However the authority may establish other facilities such as the one established in Rule 2.7.1.47 of the current RMF, which establishes that the cancellation of the CFDI may be made no later than the month in which the annual ISR declaration corresponding to the fiscal year. In this instance, the aforementioned receipt issued must be submitted.

Penalties

Mexico provides a wide range of penalties for those who fail to comply with the electronic invoice obligations established in the Federal Tax Code (Código Fiscal de la Federación or CFF) and in the current Miscellaneous Tax Resolution (Resolución Miscelánea Fiscal). In general, these penalties correspond to fines applied according to the seriousness and periodicity of the violations. Articles 81 section X in relation to 82 section X, as well as the various 83 section VII, IX, XI, of the current Miscellaneous Tax Resolution. It should be noted, however, that in certain serious cases, both the Tax Code and the Miscellaneous Tax Resolution establish that the SAT may sanction violators with the closing of the establishment from which such violations are committed.

Evolution of the Electronic Invoicing Law in Mexico

Legal Framework

The general obligation to issue CFDIs is defined in the Mexican Tax Code (Código Tributario de México), also known as the Federal Tax Code (Código Fiscal de la Federación). Article 29, paragraph II, requires taxpayers to issue CFDIs using the formats established for this purpose by the Tax Administration Service (SAT). These provisions are more detailed in the Regulations of the Federal Tax Code.

Miscellaneous Tax Resolution in force

The technical details of the CFDI are established in a decree issued annually, known as the Miscellaneous Tax Resolution (RMF). In such resolutions, the tax administration sets forth the technical conditions that such electronic documents must comply with, the term for their remission, validation process and others. Rule 2.7.1.2 of the RMF requires that the CFDI, and the digital stamps for the same, comply with the technical rules established in such resolution.

SAT Publications

The SAT periodically issues technical publications aimed at changing the content of CFDIs. The schemes, files, guides, and other documents necessary to comply with the electronic invoicing mandate are regularly updated by the SAT and published on the SAT's website.

Latest Regulatory Changes in the Country

Mexico: CFDI version 3.3 can be used until 31 March 2023

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Mexico: SAT updates error matrix for CFDI 4.0

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Mexico: Modifications to miscellaneous tax resolution 2022 and its annexes 1 and 1A

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Electronic invoicing in Colombia

Electronic invoicing in Colombia, often referred to as Colombia facturacion electronica, is mandated for established taxpayers. While it was an early mover in giving legal weight to e-invoices, Colombia’s mandate only came into effect in 2019 and has been subject to change since.

Understanding the specificities of the rules of overall tax compliance is vital. That’s why Sovos’ regulatory experts have produced this complete overview of Colombia e-invoicing. Bookmark this page to stay up to date with the latest requirements.

1. Characteristics of electronic invoicing in Colombia

2. Electronic invoicing law in Colombia

3. How does an e-invoice work in Colombia

4. Benefits of using e-invoicing in Colombia

5. Timeline of e-invoicing in Colombia

6. Penalties: What happens if I don’t comply to e-invoicing in Colombia?

7. How to choose the right e-invoicing software in Colombia?

8. Setting up e-invoicing in Colombia with Sovos

9. FAQ

10. Additional resources

Characteristics of electronic invoicing in Colombia

Colombia B2B e-invoicing

All companies are required to issue electronic sales invoices with prior validation before issuance. Companies must enable themselves as electronic issuers through the web portal assigned by the DIAN.

Suppliers must also certify as Technology Services Providers (PST) and receive a unique software identifier. The standard format used is XML, following the UBL V2.1 (Universal Business Language) adopted by the DIAN.

A digital signature is mandatory to ensure authenticity and integrity throughout the invoicing process.

Invoices must use a consecutive numbering system assigned by the DIAN, along with a Unique Electronic Invoice Code (CUFE) for identification and data integrity. Issuers must create a graphic representation of the invoice in PDF format, including a QR code.

Both issuers and recipients must archive invoices for the period established by the tax statute.

Colombia B2G e-invoicing

Starting in November 2020, electronic invoicing became mandatory for all taxpayers – including B2G transactions. All suppliers must issue electronic invoices and buyers are required to receive them. Buyers do not need to validate the invoice, but they can accept or reject it.

Electronic invoices (Facturas electrónicas)

The electronic invoice is the evolution of the traditional invoice. It has the same validity as paper in a legal sense, but it is generated, validated, issued, received, rejected and preserved electronically. In tax terms, it supports sales transactions of goods and/or services.

All electronic sales invoices for tax recognition must be validated prior to their issuance by the Special Administrative Unit of the National Tax and Customs Directorate (DIAN).

The electronic sales invoice will only be classed as issued when it is validated and delivered to the purchaser – providing it also complies with the conditions, terms and technical and technological mechanisms established by the DIAN.

Electronic equivalent documents (Documentos equivalentes electrónicos)

In the context of electronic invoicing in Colombia, equivalent documents are digital receipts issued by the DIAN (National Tax and Customs Directorate) for transactions that do not require a sales invoice.

The Electronic Equivalent Document is defined as a document that:

Contains the information of a commercial operation carried out by a subject that is not required to issue an electronic invoice
Complies with legal requirements
Is generated and transferred electronically through a technology provider authorised by the DIAN

Adjustment notes are included for the electronic equivalent document and have been created as a mechanism for their cancellation or correction.

Electronic sales receipt

An electronic sales receipt is a receipt that is issued to final consumers. It does not generate tax credit and its structure is less complex than electronic invoices.

Electronic debit and credit notes

Credit and debit notes are documents that allow adjustments or corrections to be made to electronic invoices. They must be generated and transmitted electronically to the DIAN for validation.

Document for payments in favour of non-VAT responsible

This document is a type of invoice that must be issued by the buyer when purchasing goods or services from persons not responsible for VAT.

Export and import electronic invoice

These documents must be issued to support export and import operations, in addition to other documents related to customs operations.

Electronic invoicing law in Colombia

Electronic Invoicing is mandatory in Colombia for businesses that are registered for Value Added Tax (VAT).

The mandate follows a pre-clearance model which came into effect in January 2019, starting with large taxpayers. It became mandatory for all taxpayers as of November 2020, covering B2G, B2B and B2C transactions.

Colombia requires suppliers to issue e-invoices and buyers have to either accept or reject them, though they do not need to validate the document. DIAN, the country’s tax authority, must clear the electronic invoices before they can be sent to the buyer – without clearance, the receipt cannot be issued and the goods cannot be shipped.

For more specifics on Colombia facturacion electronica (e-invoicing), read on.

Types of Operations Subject to the Colombian Electronic Invoice Regime

The electronic invoicing mandate in Colombia applies to the following documents and transactions:

Electronic invoices: Required in B2B transactions and when generating tax credit. The validity of this document is subject to strict compliance rules covering structure, issuance and validation.

Electronic equivalent documents: The following are currently considered equivalent to electronic invoices:

Tickets for cash registers with POS systems
Cinema admission tickets
Passenger transport tickets
Extracts issued by financial and similar institutions for financing operations
Air transport tickets
Documents in localized games of slots, bingo, casinos and the like
The ballot, fraction, cardboard, forms or the like in games of luck or chance
Documents issued in the collection of tolls
Settlement receipts issued by the Colombian Stock Exchange
The document of operations of the agricultural exchange and other commodities
Documents issued for home public services
Income tickets for public shows

Electronic sales ticket: The voucher issued to final consumers. It does not generate tax credit and its structure is less complex than electronic invoices.

Electronic debit and credit notes: Issued by the seller to recover expenses or accredit cancellations, discounts or other modifications to issued electronic invoices and tickets. Like electronic invoices, such notes must be pre-validated.

Document for payments in favour of the non-VAT-responsible: A type of invoice that must be issued by the buyer when purchasing goods or services from people not responsible for VAT.

Receipt for work income: Must be issued according to the format established in the technical documents of the electronic invoice when disbursements related to the taxpayer’s payroll are made, including parafiscal and social security contributions.

Electronic export and import invoice: Must be issued to support export and import operations, in addition to other documents related to customs operations. So far, only electronic export invoices have been developed and put into production.

Other documents: Expense support documents, deductions and other types of electronic media that facilitate compliance with tax obligations.

XML schema based on UBL 2.1

The standard e-invoicing format for e-invoices in Colombia is XML. This format follows Universal Business Language (UBL) V2.1.

The XML document is generated, comprised of the information that Colombia’s tax authority requires, and then signed with a digital certificate. From there, the taxpayer’s certified software validates the data, as well as both the issuer and recipient, and reports the transaction to the DIAN.

The tax authority will then record the document, assign a unique e-invoice number, notify the issuer that it has been processed successfully and deliver the XML to the issuer.

Unique electronic invoice code - CUFE

The Clave Única de Facturación (CUFE) code enables electronic invoices to be identified unequivocally. It’s also known simply as a unique electronic invoice code and is comprised of data from an invoice and the Technical Control Content Key provided by the tax authority.

The CUFE code also ensures the integrity of documents by using SHA384 encryption.

QR code

As well as being in the XML format with a digital signature and unique e-invoice code (CUFE), valid e-invoices in Colombia must include a QR code. This is mandated by law and is possible via certified technology providers like Sovos.

For customers who cannot receive electronic invoices, they are sent a QR Code invoice for the transaction.

Electronic container

One of the changes in Resolution 000012 saw the DIAN modify the e-invoicing law to implement the use of the electronic container. The electronic container is a mandatory electronic instrument used to include the information of the electronic sales invoice, debit notes, credit notes and general electronic information derived from the systems of billing – along with the validation carried out by the DIAN where applicable.

This modification means that e-invoices must utilise digital signatures to guarantee the authenticity and integrity of the document. The issuer must digitally sign the invoice to the standards laid out by the regulation and the tax authority’s signature policy.

How does an e-invoice work in Colombia?

Colombia’s electronic invoicing system contains multiple processes that the electronic biller, the DIAN, the technology providers and the electronic receivers or purchasers participate in.

Once the electronic biller complies with the authorisation requirements, they can start generating electronic invoices and equivalent documents.

Among the most important processes of this generation system are the following:

Validation: Colombia’s current electronic invoicing system requires invoices, and other documents issued by the person responsible for electronic invoicing, to be validated by the DIAN before being issued to their recipient.

Once this process is completed, the DIAN will proceed to register the electronic document in its databases with the value “document validated by the DIAN” while generating, signing, storing and sending a validation message to the electronic biller for its issuance and delivery to the acquirer.

Receipt of electronic documents: Electronic billers must also act as electronic receivers. To do this, they must establish an email to receive electronic sales invoices issued by their suppliers and other documents subject to the electronic invoice mandate.

This obligation is fulfilled by issuing an acknowledgement of receipt by the recipient and should only be done when the document issued has been validated by the DIAN. From a commercial point of view, if the recipient of the document agrees with the document received then they must formally accept it.

If the document does not comply with the commercial conditions agreed with the supplier, they must commercially reject the document and the associated acknowledgement of receipt issued. If, after receiving the document, the recipient does not reject it within three working days from the day indicated in the deliveryDate field (or in the issueDate field), the document will be considered tacitly accepted.

Contingency: The current electronic invoicing legislation states that if the taxpayer is unable to issue an electronic invoice, or any of the other equivalent documents, due to technological problems attributable to the DIAN, they may issue the document supporting the transaction without the validation of the DIAN.

These documents may be invoices in a paper checkbook. In such situations, the taxpayer must use the billing ranges authorised by the DIAN. After the contingency situation is over, the obligor will have a period of 48 hours to send these documents to the tax authority for validation.

The RADIAN: RADIAN is an information system that allows the circulation and traceability of e-invoices as a security title, hereinafter referred to as an electronic sales invoice value title.

Once an electronic sales invoice becomes a value title and is registered in RADIAN, negotiation is possible for the legitimate holder and/or through agents and/or operators authorised by the Ministry of Commerce, Industry and Tourism.

There are other processes aimed at guaranteeing the negotiation, transfer, endorsement and execution of said document.

Issuance and delivery of the sales invoice and/or the equivalent document: The issuance of the sales invoice or equivalent document includes its generation, transmission, validation and delivery to the purchaser for each of the sales operations and/or provision of services carried out.

The issuance of these documents must comply with the applicable legal requirements, as well as with the special requirements and the conditions, characteristics, terms and technical and technological mechanisms developed by the DIAN.

Benefits of using e-invoicing in Colombia

There are a host of benefits that come with e-invoicing, including:

Timeline of e-invoicing in Colombia

1995: Colombia gives e-invoices the same status as paper invoices
18 April 2016: Pilot project launched with 58 companies
January 2019: E-invoicing becomes mandatory for large VAT-registered businesses
February 2023: Large taxpayers required to issue electronic sales invoices for cash register tickets over 5 UVT
November 2020: E-invoicing becomes mandatory for all VAT-registered businesses
March 2023: Decree 442 introduces changes to electronic invoice regulations
March 2023: Taxpayers that file for income and complementary tax must issue electronics sales invoices for cash register tickets over 5 UVT
April 2023: Taxpayers that do not file for income and complementary tax must issue electronics sales invoices for cash register tickets over 5 UVT
June 2023: All taxpayers must issue electronics sales invoices for cash register tickets over 5 UVT
November 2023: Resolution 165/2023 introduces more changes to e-invoicing regulations
November 2023: Calendar of implementation of Electronic Equivalent Documents is postponed until 1 May
1 February 2024: All taxpayers in scope must have implemented the latest electronic sales invoice rules by now

Penalties: What happens if I don’t comply to e-invoicing in Colombia?

Those who do not meet the requirements of Colombia’s e-invoicing mandate may well face repercussions.

The current sanctioning system of the regime of Colombia is regulated by the provisions of article 652-1 of the Tax Statute, which basically provides for two types of sanctions. Non-compliance may result in fines of up to 1% of the value involved in invalid invoices, or the closure of establishments for up to 30 days.

How to choose the right e-invoicing software in Colombia?

When choosing e-invoicing software for Colombia, it’s crucial to consider the future. The DIAN has already introduced changes to the electronic invoicing regulations and there is a high probability that more alterations will come. The ideal compliance partner is one that combines technology with knowledge, flexibility and foresight – a partner that evolves as regulations do.

Another consideration should be the nature of your business. You could choose a point solution, but it’s more efficient to use a solution that covers all facets of tax compliance – not just in Colombia but everywhere you do business. Sovos can help.

What else do I need for VAT compliance in Colombia?

Businesses that provide taxable goods or services in Colombia may need to register for VAT. The VAT registration process is done through the single tax registry (RUT). Once registered, the taxpayer identification number (NIT) is obtained.

Foreign businesses cannot directly register for indirect taxes in Colombia as non-residents. Foreign traders must form a permanent establishment in Colombia and register for indirect taxes.

FAQ

What is electronic invoicing in Colombia?

In Colombia, all VAT-registered businesses are required to send and receive invoices electronically. All taxpayers must establish themselves as electronic invoice issuers through the tax authority’s web portal and then issue e-invoices for transactions.

Is e-invoicing mandatory in Colombia?

Colombia’s e-invoicing regime is mandatory for all businesses that are registered for VAT. That said, there are some exclusions like financial institutions, companies with an income below a particular threshold and other segments of business.

Who needs electronic invoicing in Colombia?

Any VAT-registered business that is established in Colombia is required to meet the demands of the tax authority’s electronic invoicing mandate.

How can I view an electronic invoice received in Colombia?

You can view the electronic invoice in two ways:

Using a software authorised by the DIAN to open and verify the electronic container. The software must be able to read the XML format and the digital signature of the invoice. You can use the free DIAN upload portal or a third-party software provider.

Scanning the QR code of the invoice with your smartphone or tablet. The QR code will redirect you to the DIAN website, where you can see the invoice details and download it in PDF format.

What is DIAN registration, testing and enablement?

DIAN registration, testing and enablement are the steps that a taxpayer must follow to become an authorised issuer of electronic invoices in Colombia.

The process consists of the following stages:

Registration: The taxpayer must register in the Unique Tax Registry (RUT) and obtain a digital certificate to sign the electronic invoices. The taxpayer must also choose a software provider to generate, transmit and validate the electronic invoices.

Testing: The taxpayer must perform a series of tests to verify the correct functioning of the software and the compliance with the technical and legal requirements established by the DIAN. The tests include the generation, transmission, validation and consultation of electronic invoices – as well as the management of contingencies and errors.

Enablement: Once the taxpayer passes the tests, the DIAN will enable the taxpayer to issue electronic invoices in the production environment. The taxpayer will receive a notification and a number of authorisation of numeration (NAN) to start issuing electronic invoices.

How is the monthly billing value composed?

The monthly billing value is calculated by adding the net sales value, the VAT value and the consumption tax value. The monthly billing value must be reported to the DIAN through the electronic invoicing system and must be paid within the deadlines established by the DIAN.

Is Sovos authorised by the DIAN?

Sovos is certified by the DIAN to provide e-invoicing technology and solutions to eligible taxpayers in Colombia.

Setting up e-invoicing in Colombia with Sovos

With electronic invoicing becoming more common globally, following the lead of Latin American countries like Colombia, it is important that you prioritise compliance.

The global – yet fragmented – adoption of e-invoicing solidifies the need to choose a single vendor for complete compliance, wherever you do business. Sovos is a tax compliance partner you can trust.

Focus on what truly matters: speak with a member of our team today to begin reclaiming your time.

Complete the form below to speak with one of our e-invoicing experts

Additional resources for e-invoicing compliance

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Global Tax Compliance Obligations

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Brazil e-invoicing regulations

Brazil has a mature but extremely complex e-invoicing system

In 2008, Brazil adopted a clearance electronic invoicing model in which the country’s tax authority must receive and clear an invoice before a supplier can issue it to a payer. More than a decade later, the Brazilian tax administration’s digitisation has evolved so much that other tax administrations call Brazil the Google of fiscal goods.

Current regulations include electronic invoices for: supplies of goods (NF-e), services (NFS-e), transport services (CT-e), freight (MDF-e), SPED, and EFD REINF.

In order to reduce the risk of audits and supply-chain interruptions, companies doing business in Brazil need to adopt an e-invoicing system capable of integrating and automating all of the fiscal requirements within their ERP systems.

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

Latest Changes

E-receipts issued by special cash registers are being replaced by new types of B2C e-invoices.

The tax administration is launching a new e-invoice type for suppliers of electricity.

REINF EFD v1.4 is being updated to v2.1, adding new books to reporting

Mandate Quick Facts

The first clearance e-invoicing model in South America.
All invoices must be in XML schemas predetermined by tax authorities.
Apart from the e-invoices, auxiliary documents may also be issued by suppliers.
Documents must be stored during the period prescribed by the law.

Penalties

Failure to issue an invoice, or issuing an invoice that does not meet the legal and technical criteria, will result in a penalty up to 100% of the invoice value or transaction price.
Failure to comply with invoicing obligations may result in criminal offense.

How Sovos Helps Companies Stay Compliant with Brazil E-invoicing

The Sovos e-invoicing compliance solution serves as a true one-stop-shop for managing all e-invoicing compliance obligations in Brazil and across the globe. Combining disparate local solutions in countries around the world is both costly and risky. The Sovos SAP Framework Solution is tailored to manage specific e-invoicing scenarios in Brazil as well as handling requirements in other countries around the world. It allows companies to invoice seamlessly within SAP and also monitors both AR and AP compliance processes, end-to-end, all within SAP.

More than a decade of experience in Brazil

Sovos has provided services in Brazil for over 10 years. The Sovos platform covers billing, accounts payable, e-sign, VAT Reporting and VAT digital reporting, as well as e-receipts and accounts payable (AP) automation.

Certified for Namespace and SAP with a path to S/4HANA

The Sovos embedded SAP solution enables AR and AP users to manage daily operations within SAP streamlining processes, maintaining SAP as the single source of truth.

70+ OEMs

Sovos e-invoicing compliance solutions integrate seamlessly with Ariba, Coupa and many other payment solutions.

Free Guide

Electronic Invoicing & Reporting Requirements in Brazil

For more details on the evolution and requirements of the mandate, download the guide on e-invoicing in Brazil.

Product List

eReceipts

Sovos provides a global solution for clearance-model electronic receipts, which requires B2C businesses to submit receipts to the government at the point of sale for VAT audit purposes.

AP Fiscal Automation

Sovos AP Fiscal Automation automates all inbound documents by matching PO against XML and automating procurement process, empowering companies to lower their procurement costs, reduce their risk and increase efficiencies when receiving goods from suppliers.

Feature list

E-invoicing compliance solutions tailored to market-specific requirements and scenarios.

The embedded SAP solution enables AR and AP users to manage daily operations within SAP streamlining processes, maintaining SAP as the single source of truth. Sovos provides global reach with in-house regulatory expertise for both pre-clearance and post-audit transactional invoicing. When tax authorities introduce new or modify existing mandates, Sovos keeps track so SAP customers stay compliant, enjoy peace of mind and avoid business disruptions.

Get in touch with a Sovos Brazil
e-invoicing expert.

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VAT in Norway: All you need to know about Norway’s SAF-T Requirements

Norway’s SAF-T reporting requirements are evolving as tax continues to digitize

Reform
Designed to reduce the compliance burden and administrative costs associated with audits, while giving tax authorities greater visibility of company’s tax and financial data, SAF-T has continued to gain popularity across a growing number of European countries.

Initially introduced in 2017 on a voluntary basis, Norway’s tax authority made SAF-T reporting compulsory in January 2020.

At present, the Norwegian SAF-T must only be submitted on demand in connection with an audit. However, it is expected to be extended to areas such as corporation tax.

On 1 January 2022, the tax authority introduced digital submission of its VAT return, which was also enhanced to capture other data that’s already required whenever a SAF-T submission is needed. However, as SAF-T doesn’t yet need to be submitted regularly in Norway, the completion of these new summary boxes creates a challenge for companies who are unfamiliar with SAF-T.

Have questions? Get in touch with a Sovos expert on Norway SAF-T.

Norway SAF-T Quick facts

Norway’s SAF-T requirements apply to businesses with bookkeeping obligations who use electronic accounting systems including registered foreign bodies.
Businesses with a turnover of less than NOK 5 million who aren’t subjected to mandatory bookkeeping are exempt unless they have electronic bookkeeping information available.
Enterprises with less than 600 vouchers annually that hold accounts in spreadsheets or a text editor program are exempt.

Norwegian SAF-T is submitted on request and doesn’t currently have periodic submission requirements.
SAF-T is a standardised XML format containing exported accounting information.
Norwegian SAF-T files will be submitted primarily by upload via the Altinn internet portal.
Testing is available and recommended by the tax authority.

Mandate rollout dates

1 October 2016: The first version of the SAF-T Financial was published on the Norwegian tax authority website.
9 June 2017: The administrative body on Norwegian SAF-T standards met for the first time to manage standards to suit both public and private sectors. The body meets at least once a year.
1 January 2017: Voluntary adoption of SAF-T began.
1 January 2020: Norway introduced mandatory SAF-T reporting on demand.
1 January 2022: Norway updated its VAT Return to allow for more detailed reporting and flexibility, as the new return structure removes numbered boxes and instead requires users to map their transactions to Norway’s existing tax codes that are currently utilised in the SAF-T mandate. The submission frequency of the VAT return remains the same, but users can now directly submit returns from their ERP system to allow for a more efficient process; where this is not possible, users may still upload XMLs or manually populate data via a portal.

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Norway’s SAF-T Requirements

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How can Sovos help?

It’s a challenge to extract data from the ERP, map to the correct SAF-T format and ensure it meets tax authority requirements without triggering the need for further scrutiny. Sovos software takes care of this by extracting the data, performing a full analysis and generating the submission-ready SAF-T file.

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

Making Tax Digital: All You Need to Know

What is Making Tax Digital?

The UK government introduced Making Tax Digital (MTD) with the aim of making filing VAT returns easier and more efficient for businesses. The regulation requires businesses to keep digital records and submit VAT returns via compatible software.

More than 1.8 million businesses are already benefitting from the service, and more than 19 million returns have been successfully submitted through Making Tax Digital compatible software so far.

Understanding MTD

Making Tax Digital is part of the UK government’s plans to reduce errors and make managing tax affairs easier with the use of digital tools.

Businesses must digitally file VAT returns using one of the HMRC approved compatible software solutions that connect to HMRC’s API. Using software to keep digital records of specified VAT related content is compulsory.

Making Tax Digital (MTD): Quick facts

MTD requires every VAT registered business to record and submit VAT returns electronically using ‘functional compatible software’.
Companies must use software to keep digital records of specified VAT-related documents.
Stored records must include designatory data and summary VAT data for the period.
Use of multiple pieces of software is allowed.
The format of the VAT return is a 9-box summary, filed via the HMRC’s JSON API platform, which must be digitally linked between the customer’s source data and the submitted digital return. Businesses receive and send information to HMRC via API.
Each business must set up a new digital tax account and should follow a new authentication process.
Submission of digital records can be in a range of digital formats, including XML, CSV, and Excel, provided they are API enabled.

Making Tax Digital (MTD): Roll out dates

1 April 2019: MTD for VAT introduced to UK VAT registered businesses exceeding annual gross sales of £85,000.

1 October 2019: MTD applies for businesses eligible for deferral.

1 April 2021: The ‘soft landing’ for digital links ended. Starting with that tax period, all MTD users must meet digital link requirements. HMRC may consider deferrals for taxpayers with complex legacy systems.

1 April 2022: Mandate expanded to include all businesses registered for UK VAT, regardless of size.

1 November 2022: Businesses filing VAT returns can no longer submit via an existing online VAT account unless HMRC has agreed to an exemption from MTD. Businesses that file annual VAT returns will still be able to use their VAT online account until 15 May 2023.

January 2023: Any VAT registered businesses that fail to sign up for MTD and file returns through MTD-compatible software will incur a default surcharge or late submission penalty and interest.

Penalties for not complying with Making Tax Digital (MTD)

A default surcharge of up to 15% for any late payments of VAT due.
Up to 100% of any VAT understated or over-claimed if a VAT return contains a careless or deliberate inaccuracy.
Up to 30% of an understated assessment of VAT due if HMRC isn’t informed within 30 days that it’s incorrect.
£400 for submitting a paper VAT return without an exemption.

Making Tax Digital for VAT

Making Tax Digital applies to all VAT registered businesses in the UK. Electronic submission of VAT returns, digital record keeping and digital links are all requirements of the regulation.

Digital link requirement

One of the MTD requirements is ‘digital links’ – the electronic exchange of data between software programs, products or applications without manual intervention.

A digital link is required whenever a business is using multiple pieces of software to store and transmit its VAT records and returns in-line with MTD requirements.

A digital link can be:

XML, CSV import and export, and download and upload of files.
Automated data transfer.
API transfer.

Transfer of data and subsequent import of data into software by means of email or tangible digital media (i.e. flash drive).

Making Tax Digital for Corporation Tax

MTD doesn’t currently apply for corporation tax but HMRC published results of its consultation and there are plans for a pilot scheme. A potential mandate is likely in 2026. Bookmark this live blog about updates for MTD or follow us on LinkedIn to stay up to date.

How to set up Making Tax Digital with Sovos

Sovos can help you with MTD in two ways:

You can use Sovos Advanced Periodic Reporting software to streamline your compliance workload with one solution, or
You can use Sovos’ Compliance Services Portal to access expert VAT compliance services and get full visibility of how each obligation is being handled, every step of the way.

FAQ

Can I use Excel for Making Tax Digital?

Excel is an approved digital format to submit digital records as part of Making Tax Digital, as long as the file is API enabled or the spreadsheet is digital. Using Excel can prove inefficient and error prone in comparison to other digital record software options.

How do I setup MTD?

There are a few steps involved in setting up Making Tax Digital for your business:

Choose MTD-compatible softwarelike Sovos’ Advanced Periodic Reporting technology.
Check the permissions in the software– filing VAT returns is easy once a business has allowed it to work with Making Tax Digital.
Keep digital records for current and future VAT returns– a business can find out what records need keeping here.
Sign up for Making Tax Digital and file future VAT returns using MTD-compatible software – Sovos’ Advanced Periodic Reporting solution streamlines periodic reporting obligations including MTD and other global VAT and SAF-T reporting requirements.

Who needs to register for Making Tax Digital?

All UK VAT-registered businesses need to register for Making Tax Digital. New businesses will be automatically signed up for MTD when registering for VAT through HMRC’s new VAT Registration Service (VRS).

What is the threshold for Making Tax Digital?

Since April 2022 Making Tax Digital is mandatory for all VAT registered businesses, regardless of annual turnover.

Do sole traders have to make tax digital?

If a sole trader is a VAT registered business they will have to comply with the Making Tax Digital requirements. In the UK, businesses with an annual turnover of less than £85,000 can opt to register their business for VAT but it is not compulsory.

Need help with Making Tax Digital?

Speak to our experts

Poland’s VAT Requirements

Poland’s CTC and SAF-T framework

In an effort to modernise its tax systems and close the VAT gap, Poland’s tax authority, the Krajowa Administracja Skarbowa (KAS), continues to advance its implementation of VAT reform with changes to SAF-T and the introduction of continuous transaction controls (CTCs).

Get the information you need

Poland’s SAF-T evolution

Poland introduced its version of the Standard Audit File for Tax (SAF-T) known as Jednolity Plik Kontrolny (JPK) in 2016. This incorporated multiple regulated JPK structures, of which two, JPK_VAT and JPK_FA, were relevant for VAT.

The requirement for monthly submissions of JPK_VAT was extended to all taxpayers on 1 January 2018. JPK_VAT was combined with the VAT return during 2020 and the consolidated JPK_VAT with the declaration is submitted per the frequency of the VAT Return (monthly or quarterly).

JPK_VAT with the declaration has two variants:

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

The remaining JPK structures are submitted upon request of the tax authority in event of an audit.

SAF-T quick facts

There are eight Polish JPK structures that taxpayers should be prepared for. Most are required on demand, but the JPK_V7M/K must be submitted periodically (monthly or quarterly).

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

Poland’s CTC reforms

Aiming to combat fraud and improve tax collection capabilities, Poland’s first Continuous Transaction Controls (CTC) legislation, the Krajowy System e-Faktur (KSeF), was published in Poland in early 2021.

Adoption of the proposed CTC reform occurred on 18 November 2021, following consultation with industry representatives. The implementation process is ongoing, with the voluntary phase having begun in January 2022 and the mandate due to go-live on 1 July 2024.

CTC quick facts

Participants who wish to get ahead of the mandate can now opt to use the Polish electronic invoice in structured XML format the FA-VAT, to submit supplier invoices to the KSeF (Krajowy System e-Faktur) electronically.

Other considerations for businesses include:

During the voluntary phase, buyer acceptance of e-invoices is necessary to receive invoices via KSeF (otherwise supplier will still need to issue invoices in the agreed form/format, such as PDF, paper or via EDI)
Refund period reduced from 60 to 40 days
Incentives provided to businesses to issue invoices through the KSeF portal during voluntary phase

Outsourcing using third-party service provider will be permitted
All invoices will be archived in KSeF for ten years
A qualified electronic signature or seal (QES), trusted profile or token will be required to authenticate access to the portal

Mandate rollout dates for JPK and CTCs in Poland

Poland SAF-T

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 reporting obligation

Poland CTC

29 October 2021: Legislation for a Continuous Transaction Control (CTC) e-invoicing system adopted; draft specifications released and test system made available
1 January 2022: Voluntary phase begins for the CTC system. There is no obligation to use the e-invoicing system in B2B transactions though there are several benefits if businesses chose to do so, including quicker tax refunds and exemptions from submitting the report of invoices, JPK-FA
10 June 2022: The Council of the European Union published the Council Implementing Decision authorizing the Republic of Poland to apply a special measure derogating from Articles 218 and 232 of Directive 2006/112/EC, based on the European Commission proposal published on 30 March 2022. The decision will be granted from 1 January 2024 until 31 December 2026, after being published in the Official Journal of the European Union.
1 July 2024: The CTC system will become mandatory
1 January 2025: The mandatory e-invoicing expands to the VAT-exempted taxpayers
1 January 2025: The end of the grace period for the application of the penalties

Penalties

The new SAF-T structure, like the JPK_VAT and VAT returns, must be submitted monthly, or quarterly. Failure to submit accurately and on time may result in penalties. The Polish tax authority will react quickly to inconsistencies detected in SAF-T files and use data analysis algorithms to identify fraudulent transactions.

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Poland's SAF-T Requirements

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

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Poland CTC Requirements

Understand more about Poland’s continuous transaction controls including when businesses need to comply and how Sovos can help.

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Need help to ensure your business stays compliant with the evolving reporting and emerging SAF-T and CTC obligations in Poland?

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

Our experts continually monitor, interpret and codify complex legal and technical changes into our software solutions, keeping you up-to-date and reducing the compliance burden on your tax and IT teams.

Learn how Sovos’ solution for JPK_V7M/K, CTC reforms and other VAT compliance changes can help companies stay compliant in Poland and around the world.

SII Spain: An Overview

SII Spain: Suministro Inmediato de Información

SII Spain is an electronic VAT system that affects thousands of large companies across the country. It can seem complicated, but it doesn’t have to be.

The mandate is demanding, with the impacted groups having to stay on top of the four-day reporting period. If your business meets the criteria of SII Spain, you will likely be feeling the pressure of having to comply.

Sovos is here to help, breaking down Spain’s SII system into:

How companies can comply (and what to expect if they don’t)
Key details about the mandate and how it’s developed over time
How Sovos can ease the burden for you at every stage

SII Spain is only one of the country’s tax compliance obligations. Our Spain VAT Compliance overview can help you stay on top of other mandates and obligations you may be subject to.

Get in touch

Who SII affects
Where is SII applicable in Spain?
Quick facts
What rollout dates
Penalties: What happens if you don’t comply
Sovos Helps Companies Stay Compliant with Spain’s SII
Additional obligations for VAT compliance in Spain
FAQ

Who SII affects

The mandate affects Spanish companies above an annual turnover threshold of over €6 million. It’s also applicable to VAT business groups, companies that participate in the monthly tax refund system known as REDEME and other businesses that voluntarily sign up.

Where is SII applicable in Spain?

Spain’s compliance obligations are further complicated by the country being divided into regions. Depending on where your business is based, you may well be subject to a specific combination of tax mandates.

The distinct areas where SII is applicable include:

Mainland Spain
Canary Islands
Bizkaia
Gipuzkoa
Alava

Quick facts about SII Spain

The Spanish mandate applies to companies with an annual turnover above €6 million, companies that are part of VAT groups, and companies using the REDEME system.
The following records must be sent to the tax authority:
- Registered book of issued invoices
- Registered book of received invoices
- Registered book of investment goods
- Registered book of certain intra-community operations
The transmission of the information must be via web services available to exchange XML messages.
Some formal obligations are reduced as taxpayers will no longer be required to file the information returns form 347 (third-party information), form 340 (transactions in register books) and form 390 (VAT annual summary).
In 2020 the Spanish tax administration introduced a service to pre-populate the periodic VAT return (Modelo 303) using the information taxpayers supplied via the SII.

Spain: Rollout dates

2 January 2017: The immediate supply of information on a voluntary basis for taxpayers in Spain begins.

1 July 2017: The mandatory phase of the immediate supply of information for taxpayers under the scope of the mandate begins.

1 January 2018: The period to supply information was reduced from 8 days to 4 days. The mandate also extended to other Spanish territories (Basque Provinces and Canary Islands).

1 January 2020: Introduction of a ledger to record operations related to the sale of goods in consignment.

4 January 2021: Introduction of new validations and fields that record the sales of goods in consignment

Penalties: What happens if you don’t comply

Omissions or inaccuracies in the information reporting obligation have a penalty of up to 1% of the total amount missed, with a maximum of €6,000.
Late reporting of real-time electronic VAT ledgers will trigger a penalty of 0.5% of the total amount reported, with a minimum of €300 and a maximum of €6,000 per quarter.
Errors or omissions in the Registered book of certain intra-community transactions and Registered book of Investment goods have a fixed penalty of €150.

Sovos Helps Companies Stay Compliant with Spain’s SII

Sovos serves as a true one-stop shop for managing all VAT compliance obligations in Spain and across the globe.

Sovos supports the Suministro Inmediato de Información (SII) platform, ensuring our customers remain compliant with the legal and technical framework developed by the Spanish tax authority (AEAT).

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

Learn more about our solution

Additional obligations for VAT compliance in Spain

While SII Spain affects many large companies nationwide, there are numerous other compliance obligations taxpayers must be aware of.

Spain B2G E-invoicing: E-invoicing has been mandatory in Spain for all transactions between public administrations and their suppliers since 2015.

Read our dedicated Spain e-invoicing overview for more information on B2G electronic invoicing.

Spain B2B E-invoicing: Businesses are under varying obligations where e-invoicing is concerned, largely depending on the nature of transactions. Mandatory B2B e-invoicing is anticipated to be implemented from 2024.

Read our dedicated Spain e-invoicing overview for more information on B2B electronic invoicing.

Bizkaia Batuz: Batuz is a tax control strategy governed by the government of Bizkaia which applies to all companies and taxpayers that are subject to the province’s regulations.

Find out more about Bizkaia’s Batuz tax system.

TicketBAI: TicketBAI is an e-invoicing mandate from the numerous tax authorities in the Basque Country which covers Álava, Biscay, and Gipiuzkoa. It outlines obligations for both individuals and companies to use software to report invoice data to the Tax Administration in real-time.

Understand TicketBAI with our dedicated blog.

FAQ for SII in Spain

What is SII in Spain?

The Suministro Inmediato de Información (SII) is a platform to submit invoice data to the tax authority in Spain. Taxable persons who are in scope must report invoice data within four business days following the date of issue.

In 2020 the tax administration announced a new version of the SII, introducing a ledger to record operations related to the sale of goods in consignment. This came into effect on 1 January 2021.

When did Spain introduce SII?

The Suministro Inmediato de Información (SII) was introduced on 2 January 2017 on a voluntary basis, extending to a mandatory basis on 1 July 2017. Since then, there have been changes and additional requirements

What regions in Spain use SII?

SII applies to multiple regions in Spain, including Mainland Spain, the Canary Islands, Álava, Biskaia, and Gipiuzkoa.

This was not the case when the legislation originally came into effect, as it excluded the likes of the Canary Islands, Ceuta, Melilla, Basque Country and Navarra.

What is SII reporting in Spain?

The Immediate Supply of Information (Suministro Inmediato de información) SII is a system for keeping the Value Added Tax record books in the local Tax Authority’s electronic headquarters by supplying VAT-relevant information on a near-real-time basis.

What submissions are required for SII?

Issued Invoices Ledger
Received Invoices Ledger
Investment goods ledger
Certain Intra-Community operations ledger

Looking for more VAT compliance resources?

Guide to European VAT Compliance

Your guide to making VAT compliance simple

Get the guide

Spain VAT compliance

A comprehensive overview about VAT compliance in Spain

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E-invoicing Guide

This guide is all you need to understand e-invoicing for good.

Read the guide

Spain e-invoicing

What you need to know about e-invoicing in Spain.

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Need immediate help with tax compliance in Spain?

Talk to Sales

Tax in Hungary: All you need to know about RTIR Hungary

RTIR Hungary

In 2018, Hungary established a legal framework requiring taxpayers to use a designed schema to report invoice data to the tax authority (NAV) in real-time for domestic transactions above a minimum VAT amount.

Due to the success of this measure, the scope of the mandate has been extended to include a wider range of transactions, and the earlier thresholds have been abolished. The impact of the mandate is now broadly felt in Hungary where all transactions between domestic taxable persons must be reported to the NAV, regardless of the amount of VAT accounted.

Have questions? Get in touch with a Sovos expert on RTIR Hungary.

Hungary VAT mandate quick facts

Immediate disclosure of data from all invoices issued under the scope of the mandate.
Once an e-invoice is issued, transmission of data must occur automatically using a machine-to-machine interface and must be done without human intervention
The transmission must include identification data and the obligatory data content as required under the Hungarian VAT Act.
VAT returns are filed monthly or quarterly and are due on the twentieth of the month after the end of the tax period.
The VAT return contains several appendices requiring additional information on transactions such as supplies of new means of transport and metals subject to the domestic reverse charge.
Alongside the VAT return, taxpayers must submit a summary report on all domestic purchases for which they’re claiming an input tax deduction.

Mandate rollout dates

1 July 2018: Mandate applies to all taxable persons to report invoice data in real-time to the National Custom and Tax administration of Hungary for domestic transactions with a minimum VAT amount of 100,000 HUF.
1 July 2020: The VAT threshold was abolished and all domestic transactions between taxable persons in Hungary must be reported regardless of the VAT accounted.
1 January 2021: Reporting obligations include B2C invoice issue and B2B intra-community supplies and exports.
1 January- 31 March 2021: The Ministry of Finance granted a sanction-free three-month grace period to comply with new reporting obligations and to give businesses time to transfer from the current version (v 2.0 XSD) to the new version v3.0 XSD.
1 April 2021: Mandatory usage of the new version (v3.0 XSD) begins.

RTIR Penalties

Failure to report the invoices in real-time could lead to an administrative penalty of up to 500,000 HUF per invoice not reported.
Additional penalties would apply for non-compliance with the invoicing software requirements.

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Hungary’s CTC Requirements

Understand more about Hungary’s NAV system, how to file invoices, when businesses are required to comply and how Sovos can help.

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Sovos helps companies stay compliant with Hungary Real Time Reporting Requirements

As Hungary edges ever closer to CTC e-invoicing invoice clearance, Sovos enables businesses to stay up to date with the latest requirements and technical specifications so they can effectively connect with the NAV and honour their VAT compliance obligations.

E-Invoicing France: All You Need to Know

E-invoicing France

France will implement mandatory B2B e-invoicing, as well as an e-reporting obligation. This mandate impacts all companies operating in France.

This new e-invoicing mandate is complex and introduces the continuous transaction controls (CTC) model.

Note: The Finance Law for 2024 has been officially adopted and published in the Official Gazette on 30 December 2023. Our blog, France: B2B E-Invoicing Mandate Postponed, is promptly updated whenever there are changes to the rollout of the French mandate.

France’s e-invoicing mandate, combined with the e-reporting obligation, provides the tax authorities with access to transaction data. This is to increase efficiency, cut costs and fight fraud.

Whether you are a buyer or supplier, the mandate’s effect on businesses and their operational processes, financial systems and people is extensive.

The France e-invoicing guide will explain:

How e-invoicing in France works
Who needs to comply and when
Key information about penalties and non-compliance

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

Quick facts: E-invoicing in France for B2B and e-reporting
E-invoicing and e-reporting in France: Rollout dates
Penalties: What happens if you don’t comply
Register for e-invoicing in France with Sovos
FAQ for e-invoicing and e-reporting in France
More resources for E-invoicing and tax compliance
Need immediate help with tax compliance in France?

Quick facts: E-invoicing in France for B2B and e-reporting

The e-invoice mandate is a model based on registered certified service providers connecting taxpayers to a centralised platform (Chorus Pro). There is also an option for taxpayers to connect directly to Chorus Pro.
When directly transmitting to the centralised platform, the structure of the e-invoices can be UBL, CII or Factur-X (a mixed format). E-invoices exchanged between two registered service providers can use any other structured format. Also, during a transitional period (up until December 2027), taxpayers may submit their invoices in an unstructured PDF format.
E-invoices must contain all existing tax mandatory fields as well as those required by commercial laws, including line-item details (and for line-item data from January 2026). The invoice must mention the operation type (goods, services, mixed) and the VAT payment option. The inclusion of additional mandatory fields in e-invoices is a requirement. Accepted formats include structured and hybrid (image + structured data).
Exchanging e-invoices directly between trading parties is not allowed. Either registered service providers or the centralised platform transmits the e-invoice to the buyer party.
Payment status data for each service invoice is shared.
E-reporting frequencies are based on the VAT regimes that taxpayers are subject to.

Want to learn about the upcoming mandatory e-invoicing requirements in France? Download our ebook, France: A New Horizon – E-invoicing Mandate.

E-invoicing and e-reporting in France: Rollout dates

September 2026: first phase of mandate
- Inbound e-invoicing for all companies. Outbound e-invoicing (+ e-reporting) for Large & Mid-Size businesses
September 2027: second phase of mandate
- Outbound e-invoicing (+e-reporting) for any other companies

*The e-invoicing mandate does not apply to B2C and cross-border invoices. However, there is an obligation to report those transactions so the tax administration has full visibility.

Penalties: What happens if you don’t comply

E-invoicing: €15 per invoice, capped at €15,000 per year

E-reporting: €250 per transmission, capped at €45,000 per year

Register for e-invoicing in France with Sovos

Sovos can help your business comply with the French mandate with a range of services:

Tax compliance services – to control, sign, archive and format invoicing data according to the legal requirements as well as create SAF-T (FEC) reporting for both suppliers and buyers
Connectivity services – through Sovos or via our partners to deliver e-invoice, e-reporting and lifecycle status data

Learn more about our scalable solution for France’s continuous transaction controls requirements

FAQ for e-invoicing and e-reporting in France

What is e-reporting in France?

France’s e-reporting requirements are alongside the new e-invoicing mandate, with the reporting frequency based on the taxpayers’ VAT regime requirements.

What is e-invoicing in France?

France’s e-invoicing requirements come into effect during 2024-2026, depending on business size. All companies must be able to receive e-invoices under the new rules that come into effect on July 2024.

What e-invoice format will be required in France?

When directly transmitting to the centralised platform, the structure of the e-invoices can be UBL, CII or Factur-X (a mixed format).

E-invoices exchanged between two registered service providers can use any other structured format.

During a transitional period until December 2027, taxpayers may submit their invoices in an unstructured PDF format.

Is there a mandatory platform to use for e-invoicing or e-reporting?

Transmission of all domestic B2B invoices must be through the central platform (Portail Public de Facturation – PPF) or via registered service providers connected to the platform (Partner Dematerialization Platforms – PDP).

How many countries have implemented e-invoicing?

There are a growing number of tax authorities that have implemented e-invoicing globally, including France, Italy, Saudi Arabia and India. There are also many countries working on implementing e-invoicing including Germany and Spain.

Learn more about e-invoicing and how to comply.

Looking for more VAT compliance resources?

Guide to European VAT Compliance

Your guide to making VAT compliance simple

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Blog: Continuous Transaction Controls

Increase your understanding of continuous transaction controls with our blog, written by a Sovos tax expert

get the e-book

E-invoicing Guide

This guide is all you need to understand e-invoicing for good.

Read the guide

eBook: VAT Digitization in Eastern Europe

A Quick Guide to E-invoicing and Real-Time Reporting

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Need immediate help with tax compliance in France?

Get in touch

E-invoicing Italy: All you need to know

Italy was the first country in the region to introduce a clearance e-invoicing model with the Sistema di Interscambio (SdI) platform. Seeking to close one of Europe’s most significant VAT gaps, the government has steadily improved its Continuous Transaction Controls (CTC) system.

Beginning with B2G e-invoicing in 2014 and extending to cover domestic B2B and B2C e-invoices in 2019, Italy became the first EU country to make B2B e-invoicing mandatory through a clearance process.

This page will:

Explain how Italy’s e-invoicing works
Help you understand how to comply with the e-invoicing regulations
Answer your questions about the Sistema di Interscambio

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

Quick facts
Scope of e-invoicing in Italy
Mandate Rollout Dates
Penalties
Register for e-invoicing in Italy with Sovos
FAQ

Quick facts about e-invoicing in Italy

Issuing e-invoices requires creation in a structured format and transmission is via the Sistema di Interscambio
The Fattura PA – the tax authority’s XML schema format – is the required format for issuing e-invoices
For B2B e-invoices, businesses can choose how to ensure the integrity and authenticity of invoices, but there is a strong market preference for Qualified Electronic Signatures. However, B2G e-invoices must be electronically signed.
Exchange of National Health Service purchase orders is through the NSO platform and referenced accordingly in the e-invoice.
E-archiving invoice requirements include the obligation to:
- Execute a signing and time stamping process for e-invoices in an archive
- Maintain a documented description of the archive and the archiving process (Manuale della Conservazione)
- Put in place a clear delegation plan setting up the responsibilities around the archiving process
Since 1 July 2022, all cross-border transactions must be reported through the SdI in the FatturaPA format. Taxpayers can continue to exchange cross-border invoices in any agreed way.

Scope of e-invoicing in Italy

B2B e-invoicing in Italy applies to:

Domestic B2B transactions between Italy resident/established taxpayers
Almost all Italy resident/established taxpayers
Included in 2022: Taxpayers who adopt the flat-rate tax regime (regime forfettario) and amateur sports associations and third sector entities with revenue up to EUR 65,000
From 1 Jan 2024: Microenterprises with revenues or fees up to EUR 25,000

B2G e-invoicing in Italy applies to:

All taxpayers supplying goods/services to public administration entities

E-invoicing in Italy: Mandate Rollout Dates

6 June 2014: Phased roll-out of mandatory B2G e-invoicing starts in Italy
1 July 2018: Clearance mandate goes into effect for manufacturers and distributors of petrol and diesel intended for use as a motor fuel in cars and road vehicles
1 September 2018: Mandate starts for tax-free sales to non-EU individuals acting as final customers
1 January 2019: Mandate becomes a requirement for domestic B2B and B2C transactions in Italy, with minor sector-specific exceptions
1 February 2020: Exchange of purchase orders for the supply of goods to entities associated with the National Health Service through the NSO platform becomes compulsory and reference in the e-invoice becomes a requirement
1 January 2021: Introduction of pre-populated VAT returns and enforcement of new FatturaPA schema
June 2021: Enforcement of the new requirements for the creation and archiving of electronic documents
October 2021: Voluntary transition phase for e-invoicing between Italy and San Marino began
1 July 2022:
- Italian businesses must report information on cross-border transactions to the SDI in the FatturaPA format. As a result, Esterometro was abolished on 30 June 2022
- E-invoicing using the FatturaPA format becomes mandatory between Italy and San Marino, with the Italian SdI as the access point for Italian taxpayers and the HUB-SM platform as the SdI counterpart on San Marino’s side
- Scope of the B2B e-invoicing mandate in Italy broadened to include:
  - Taxpayers who adopt the flat-rate regime (regime forfettario)
  - Amateur sports associations and third sector entities with revenue up to EUR 65,000
January 2024: E-invoicing scope to include microenterprises with revenues or fees up to EUR 25,000

Penalties: What happens if you don’t comply

Failure to issue an invoice or issuing an invoice that doesn’t meet the XML format will result in a penalty between 90-180% of the associated VAT amount.
Issuing a purchase invoice to a client without adhering to mandate requirements will result in a penalty of 100% of the associated VAT amount.
After a grace period (expired for the supply of goods and services), there will be no payment for invoices issued to entities associated with the National Health Service if no prior purchase order has been transmitted through the NSO platform and referenced in the e-invoice

Register for e-invoicing in Italy with Sovos

Sovos ensures compliance with all SdI e-invoicing and VAT requirements in Italy including CTC e-invoicing, reporting and e-archiving. All you need to do is work with us and you can use our solution that connects directly with the SdI.

Want to learn more about e-invoicing?

Download the 13th edition of Trends to learn about the global e-invoicing landscape

Eastern Europe is another region adopting e-invoicing. Find out more in our ebook, VAT Digitization in Eastern Europe

FAQ for e-invoicing in Italy

Is e-invoicing mandatory in Italy?

E-invoicing in Italy is mandatory for the majority of the B2B, B2C and B2G invoices. Suppliers performing activities classified as “Commercio al minute e attivitá assimilate” are exempt from the obligation of issuing e-invoices, unless their customers so request them; on the other hand, those suppliers are required to electronically transmit a daily aggregate report (It.: Scontrino Elettronico). Reporting of cross-border transactions through the SDI in the FatturaPA format is also mandatory.

How does e-invoicing work in Italy?

The tax authority requires all invoices in the Fattura PA XML schema format. Transmission of e-invoices happens through the Sistema di Interscambio. E-invoices must be cleared by the tax authority. The Italian tax authority delivers the legal cleared e-invoice to the recipient.

How do you securely connect with the SdI to issue invoices?

With ease. Our solution connects securely with the SdI, freeing you from the burden of knitting together different systems and platforms.

How do you comply with Conservazione sostitutiva?

The term conservazione sostitutiva refers to a long-term preservation process required for compliant archiving of e-invoices in Italy. E-invoices must be preserved after being archived by grouping them together in a so-called ‘package’, and providing that e-invoice package with a qualified digital signature or seal and a time reference.

This process must be completed no later than three months after the deadline for the submission of the annual fiscal declaration at the end of the fiscal year. E-invoice preservation is an integral feature of Sovos eArchive for invoices stored under Italian law.

Looking for more VAT compliance resources?

Guide to European VAT Compliance

Your guide to making VAT compliance simple

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Blog: Continuous Transaction Controls

Increase your understanding of continuous transaction controls with our blog, written by a Sovos tax expert

get the e-book

E-invoicing Guide

This guide is all you need to understand e-invoicing for good.

Read the guide

eBook: VAT Digitization in Eastern Europe

A Quick Guide to E-invoicing and Real-Time Reporting

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Need help with e-invoicing in Italy?

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China's E-Invoicing Regime

The move to customer facing e‑invoicing grows in China.

Get the information you need

Reforms

Quick facts

Mandate rollout dates

How can Sovos help?

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

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

Tax in Romania: Romania’s SAF-T reforms

Romania SAF-T quick facts

Continuous transactions control (CTC) reforms

Romania CTC quick facts

Mandate rollout dates for SAF-T and CTCs

Romania SAF-T

Romania CTC

Romania’s SAF-T Requirements

Romania CTC Requirements

How Sovos can help with tax in Romania

Saudi Arabia - E-Invoicing

Saudi Arabia e-invoicing from December 2021

Get the information you need

Mandate Quick Facts

Important dates for e-invoicing in Saudi Arabia

Saudi Arabia CTC Requirements

How Sovos can help

The VAT Import One Stop Shop (IOSS)

Simplify EU VAT with IOSS in one single return

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What is IOSS?

Full IOSS service

We act as your IOSS Intermediary

What are the benefits?

Quick Facts

Penalties and Fines

It’s time to get EU VAT compliance right with IOSS and Sovos

Portugal’s VAT Regime

Portugal pushes further ahead with VAT digitization

Get the information you need

Quick facts

Important dates

Need help to ensure your business is VAT compliant in Portugal?

E-Invoicing India: All You Need to Know​

India E-Invoicing Requirements

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

India’s e-invoicing mandate

Mandate Rollout Dates

Penalties

Sovos Helps Companies Stay Compliant with India E-invoicing

Greece myDATA: All You Need To Know

Greece's myDATA scheme

Have questions? Get in touch with a Sovos Greece myDATA expert.

Greece's mandate

Mandate Rollout Dates

Penalties

Sovos helps companies stay compliant with Greece’s myDATA

Looking for more VAT compliance resources?

Guide to European VAT Compliance

Blog: Continuous Transaction Controls

E-invoicing Guide

eBook: VAT Digitization in Eastern Europe

Need immediate help with tax compliance in Greece?

South Korea's Long Standing e-Tax Invoice System

South Korea E-Invoices

Get the information you need

Mandate quick facts

Mandate rollout dates

Penalties

South Korea CTC Requirements

Good to Know

How Sovos can help

Mexico's electronic invoicing requirements:

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

Types of tax certificates

Essential Components

Processes

Validation

Tax Mailbox

CFDI Cancellation

E-Invoicing India: All You Need to Know