E-invoices were first accepted as legal VAT documents by all EU
Member States in 2004. But while all member states accept
e-invoicing, the detail of legislation varies from country to
country, with some being far stricter than others. And according to
Accountis Europe, a provider of secure financial document exchange
and payment systems, confusion looms.
For companies in the UK, there are no penalties for
non-compliance, but they will lose the ability to deduct VAT. But
organisations in Ireland can be fined €1,520 for each non-compliant
e-invoice, plus an additional personal penalty of €950.
Organisations in Sweden face some of the harshest penalties, with
non-compliant e-invoicing or storage incurring a criminal penalty
of up to two years in prison.
“Trying to keep track of the different country regulations can
be a major headache for companies who trade internationally,” said
Rhys Jones, managing director of Accountis. “All e-invoices must
comply with VAT rules stipulated in the place of supply."
So an e-invoice generated for goods sent out from an office in
Spain must comply with Spanish law, even if the organisation is
registered in Germany. "As a result," says Jones, "a company needs
to be fully conversant with legislation in all the countries from
which they supply.”
To ensure that e-invoices are compliant throughout Europe, it
has been suggested that companies use a pan-European e-invoicing
service which operates a proven European transaction network.
Electronic invoice presentment and payment (EIPP) systems have
the expertise and local knowledge to make sure all e-invoices are
VAT compliant. This eliminates the risk of being penalised for
exchanging non-compliant e-invoices. They also offer additional
features to help facilitate smooth international trading, such as
multicurrency and multilingual support.
