Member States of the European Union have different standards of electronic invoicing, most of which are incompatible. Several times in the past, the European Council has pointed out that the further development of cross-border online commerce and the modernisation of public administration should include the transition to an electronic invoicing system in public procurement.
Directive 2014/55 / The EU on e-invoicing in public procurement aims to remove barriers caused by different standards for e-invoicing in public procurement in Member States. The Directive defines an electronic invoice as one that ‘... has been issued, sent and received in an organised electronic format that allows it to be processed automatically and electronically’.
The introduction of electronic invoicing, when fully launched across Europe, will simplify business transactions and help meet fiscal requirements. This will have a significant and beneficial impact on daily business
Although Directive 2014/55 / The EU has set a deadline for introducing the standard at 18 April 2019, Italy, for example, has changed faster. In Italy, electronic invoicing in public procurement has been mandatory for ministries, tax agencies and national security agencies since June 2014, and for all public entities – from 31 March 2015 Since January 2017 companies are also able to use e-invoicing for private commercial transactions.
The Italian Government asked the European Council for a special mandate to oblige all Italian operators to use electronic invoicing for all transactions between companies and between companies. From 1 January 2019 This shall apply to all transactions between entities and persons established or resident in Italy. This also applies to foreign taxpayers holding a permanent establishment in Italy.
Sistema di Interscombio (SDI) is an electronic platform managed by the Italian Revenue Agency. SDI receives invoices and delivers them to its target customers by storing them electronically by ten years. The electronic invoice must be displayed in XML format.
The electronic signature of the person issuing the invoice and its transmission by the SDI guarantees its authenticity and. An invoice issued in a different format, on paper or otherwise, or not sent through an SDI, shall be considered to have not been issued and penalties may be imposed in that case.
Anyone who uses electronic invoices has a recipient code or certified e-mail address (PEC) to which SDI sends invoices. All resulting transactional information shall be stored by the Italian tax agency which may use it for control and audit purposes.
Electronic invoicing does not apply to operators or consumers outside Italy who will continue to receive and issue invoices in a traditional way, even if they are registered as VAT payers in Italy. In fact, the new e-invoicing requirements have no impact on VAT rules that apply to transactions between Italian and European operators.
However, it is possible for foreign entities to register in the SDI in order to obtain the recipient code so that they can receive and issue electronic invoices voluntarily. This may be a cost-effective option for companies in the same group where one they are based in Italy.
The introduction of electronic invoicing, when fully launched across Europe, will simplify business transactions and help meet fiscal requirements. This will have a significant and beneficial impact on daily business.
AUTHOR: Luca Borella, Magagnoli and Associates, Bologna, Italy and Robert Righi, Modena, Italy
Source: https://www.russellbedford.com/latest/insight/the-new-world-of-electronic-invoicing/