Political agreement on mandatory e-invoicing (ViDA)
On 5 November 2024, the 27 member states of the European Union unanimously reached a political agreement on the proposal "VAT in the Digital Age" (ViDA). This means that the VAT system within the EU will undergo significant modernisation.
a new phase for e-invoicing and digital reporting in the EU
The most impactful part of the ViDA package is an EU-wide obligation for e-invoicing and digital VAT reporting. This marks the end of the PDF invoice as we know it. Member states are allowed to mandate e-invoicing for domestic transactions between organisations without the approval of the European Council. This measure will encourage more member states to mandate e-invoicing and digital reporting. Invoices exchanged between European countries must, in any case, be electronic by the deadline of 1 July 2030.
one VAT return per invoice!?
That’s correct. The ‘Digital Reporting Requirements’ (DRR) stipulate that a summary of each invoice must be sent electronically to the tax authority. In addition to sending a summary of a sales invoice, the agreement also states that the recipient of an invoice must send a summary to the local tax authority within 10 days of receiving the e-invoice as a condition for reclaiming VAT. However, member states may still have the option to waive certain parts of this obligation under specific conditions.
With the EU-wide implementation, the periodic report on Intracommunity Transactions will be abolished. Domestically, countries are expected to adopt this system earlier for standard VAT reporting. Belgium has already announced its plans to do so.
current developments in EU member states
Although ViDA aims to fully harmonise e-invoicing across the EU, member states that had reporting obligations for local transactions or advanced plans for such requirements by 1 January 2024 are allowed to retain these obligations in their current form. As a result, businesses with branches in different countries will still face varying invoice and reporting obligations even after 1 July 2030.
Several EU member states are already ahead of the curve in implementing ViDA and have taken steps towards mandatory e-invoicing and digital reporting. Italy has been a pioneer, mandating e-invoicing for domestic transactions since 2019. Poland has introduced its national e-invoicing system, KSeF, and will require e-invoicing for all businesses in the coming years. Spain is working on a nationwide rollout of a real-time invoice reporting system, while France is expanding its e-invoicing platform, Chorus Pro, to include B2B transactions. Germany is preparing for the implementation of e-invoicing with concrete plans and pilot projects. In Belgium, e-invoicing via the Peppol network will be mandatory for all B2B invoicing from 1 January 2026.
ready for the future!
The impact on organisations is significant. It requires organisational adjustments and a review of internal processes. Employees need to be trained to work with new systems. Companies with international branches must account for varying implementation timelines and requirements across different countries.
At the same time, eConnect customers will hardly notice these changes, as they are already future-ready. If you are unsure where to start, or if your organisation has not yet begun, it is crucial to take steps towards implementing e-invoicing.
At eConnect, we are ready to assist software providers and organisations with the transition to e-invoicing and digital reporting. We simplify the process by eliminating complexity, automating format transformations, and correcting invoices that do not meet the standards. We also see it as our role to automatically send the required summary to the relevant tax authority alongside the e-invoice. With our years of expertise, we support the implementation of both European standards and national requirements.
want to know more?
Is your software package or organisation ready for the future of e-invoicing? Contact the smartest solution for worry-free e-invoicing! contact form and discover how we can support your organisation. Send an email to info@econnect.eu or call us at 088-4406633.