E-invoice

What is an e-invoice?

The Estonian Accounting Act defines an e-invoice as a machine-readable invoice that must be compliant with the requirements of the guidelines on machine-processable source documents referred to in subsection 7 (10) of the act or with the European standard on electronic invoicing.
 

Why is an e-invoice necessary?

• The introduction of e-invoices, i.e. the transition to machine-readable invoices, helps save time and reduces the administrative costs of the company. Paper and PDF invoices are expensive and time-consuming to process. In Estonia, the introduction of e-invoices would help save nearly 103.73 million euros annually.
• The introduction of e-invoices improves the quality of data – there is no need to enter data multiple times, which reduces the occurrence of possible errors when data is manually entered multiple times.
• The introduction of an e-invoice positively affects the level of digitisation of other business processes of a company or agency, creating preconditions for innovation in other areas.
• E-invoicing creates new market niches and business opportunities.

What is the plan?

The aim is to promote the exchange of e-invoices between companies. Based on the field in which companies operate, e-invoices can be divided as follows: B2B – (Business to Business), i.e. from company to company; B2G – (Business to Government), i.e. from a company to public sector agencies; and B2C – (Business to Customer), i.e. from company to customer or consumer.

Pan-European e-invoices. Based on European initiatives, all countries of the European Union are gradually converting to electronic paperless invoicing. The current economic market functions in a much broader way than it used to. In a globally functioning economy and trade, a pan-European e-invoicing capability is important: it must be possible to accept and send e-invoices across Europe. One possibility is to join the pan-European network of electronic documents and e-invoices, PEPPOL (Pan-European Public Procurement Online). PEPPOL is an environment for the exchange of machine-readable documents, one of the functions of which is to support and facilitate pan-European e-invoicing.

In order to ensure pan-European capability to receive and send e-invoices, it is important to implement the European standard for e-invoices (standard EN 16931). The European standard for e-invoices will make it easier to send e-invoices to foreign countries, to receive them from abroad, and to participate in the European single digital market.

Estonia is converting to the European standard for e-invoices, and the Estonian standard will no longer be updated. The private and public sectors are actively cooperating with each other: the Ministry of Finance, the e-invoices and real-time economy working group of the Estonian Association of Information Technology and Telecommunications Union, and the Ministry of Economic Affairs and Communications are managing the process.

Grants, trainings, and development projects in Estonia

Support measure for e-invoices. From 30 May 2022, entrepreneurs can apply for a grant of up to 20,000 euros from the Estonian Business and Innovation Agency, which aims to encourage business process innovation through e-invoicing developments. Further information is available at: https://eas.ee/grants/e-arve-toetus/.

Trainings. In 2022, the network of county development centres organised e-invoicing training for accountants and entrepreneurs. Read more: E-invoicing training for entrepreneurs and accountants.