What is an electronic invoice?
How can one make savings in costs, time and staffing?
What benefits result from moving to electronic invoicing?
Find out how switching your business workflows to digitised invoicing is indispensable now and is even regulated by law.
Automated and digitised invoicing is indispensable in times of digitisation. The switch to electronic invoicing from paper invoices makes it possible to reduce costs by 80%. Moreover it is possible to make savings on staffing, time and raw materials and reduce mistakes to a minimum.
But how does e-invoicing work? What challenges does it entail? For small businesses, for example. What must be taken into account and what are PEPPOL and ZUGFeRD? These are terms that one comes across but leave much unexplained.
In compliance with the 2014/55/EU guidelines of the European Parliament issued in May 2014, an increasing number of countries are providing legal regulations on e-invoicing .
Find out more about this topic in our e-invoicing manual and find answers to all your questions.
An electronic invoice is an invoice that is issued, sent and received in an electronic format. An e-invoice, like a normal invoice has the same validity and content as a paper invoice. An electronic invoice can be represented and sent in different data formats.
Invoices are still printed on paper, put in envelopes, franked and sent with expensive postage – only to be entered digitally into their system by recipients before they can be paid. Above all, this manual procedure costs money, time and labour.
On 1 July 2011 the Federal Ministry of Finance ruled that electronic invoices had the same validity as paper invoices. Since then, e-invoices can also be sent by email and do not need to be signed.
According to §4a Abs.2 EGovG, the Federal Office for Justice defines an electronic invoice as:
“An invoice is electronic if
A so-called structured, electronic format is understood to be a EDI (Electronic Data Interchange) connection.
An invoice in a structured format is not visible to the human eye. These invoices are transmitted to the customer’s ERP via EDI. The structured invoice must be displayed in order to be processed further. Normally, the invoice must be checked internally, approved, and then filed
An invoice in a hybrid format is visible to the human eye, as it can be displayed as a PDF file whilst being embedded in an XML structure. A hybrid format, such as a ZUGFeRD invoice combines the structured format with visual representation. A ZUGFeRD invoice contains a PDF file for display to human beings and an XML format with the structured invoice data
Electronic invoices are sent by means of EDI or XML connections and can be displayed by the customer in various file formats. Invoices can be accepted in PDF, XRechnung, ZUGFeRD and many other formats
e-Invoicing is really very straightforward. Terminology such as EDI, ZUGFeRD, PEPPOL etc. is endless, but here we will make sure that you understand how e-invoicing really works!
E-invoicing is a part of EDI, the electronic exchange of data between businesses. A large number of different data formats can be exchanged between business partners using EDI: These data formats therefore naturally include e-invoices.
But how are e-invoices exchanged?
You wish to send an invoice from your ERP system to the customer.
The file is first intercepted by the INPOSIA e-invoicing system, converted into your business partner’s file type and then transferred both into your own and your business partner’s system. This procedure also works in the opposite direction. From your business partner back into your ERP system.
Your business needs an EDI connection in order to transmit e-invoices. An EDI connection is also possible for small and medium-sized companies.
The digitalization of electronic invoicing brings many advantages. But the main advantage is definitely the cost-saving for companies. Manual invoicing is very complex, costly, and time-consuming. When converting to electronic invoicing, companies can save up to 80% compared to paper invoices.
With the digital outgoing invoice, you save on material, printing, and postage costs. You can also save on personnel capacity and use it more effectively. Manual sources of error can be reduced and invoices delivered more quickly. The fast delivery of invoices is followed by faster payment, which results in increased liquidity.
Cost savings – Switching from paper invoices to e-invoicing can enable savings of up to 80% in process costs.
Security – simpler and more secure exchange of digital data with legally compliant transmission in more than 60 countries
Savings in resources – Save on time, staffing and raw materials. Digitise and automate your invoicing and become more efficient.
Flexibility – Transfer not only your invoicing but also your payment information, business books, electronic transport documents, and much more.
1,53€ / saving per invoice for invoice issuer
4€ bis 15€ / per invoice saving for invoice recipient
1,50€ / lost discount per paper invoice
40.000€saving on 10,000 invoices per year
Saving of 25 days processing time compared to paper invoicing
As mentioned above, on 1 July 2011 the Federal Ministry of Finance ruled that electronic invoices had the same validity as paper invoices. Since then, e-invoices can also be sent by email and do not need to be signed.
According to the 2014/55/EU directive, public sector contractors are even obliged to implement electronic invoicing.
The 2010/45/EG directive regulates the legal framework for e-invoices in the European Union. But each member state draws up its own regulations, so they are different in each country. We have drawn up a list of countries’ e-invoicing regulations in order to give you an overview of the different systems.
Data transmission is a component part of our globalised and digitised world. Solutions had to be found to simplify management processes linked to the new global market in trade, logistics and fiscal matters.
ZUGFeRD (Zentraler User Guide des Forums elektronische Rechnung Deutschland) evolved from the Forum elektronische Rechnung Deutschland and enables small and medium-sized business to exchange their invoices rapidly and digitally with their business partners/suppliers. All the general benefits of e-invoicing such as automatic processing, cost reduction and the elimination of material and postage costs were thus addressed.
The hybrid invoice format, the ZUGFeRD invoice, is now well-established in B2B and is the most commonly used type of e-invoice. The main benefit of ZUGFeRD invoices is that the invoices are issued both as PDF-A/3 files (visible to humans in a readable format) and as structured invoices (as XML file for computers).
A ZUGFeRD simplifies invoice entry processing, checking and audit-proof archiving.
Moreover, the latest EU-compliant ZUGFeRD 2.1/XRechnung enables B2G e-invoicing.
COST REDUCTION
LEGAL SECURITY
ENVIRONMENTAL PROTECTION
AUTOMATION
ARCHIVING
An growing number of businesses are joining the PEPPOL network –
But what is PEPPOL exactly?
PEPPOL is an EU scheme that enables international concerns – both in the public sector and private companies – to carry out their communication in procurement processes electronically. Connected companies can exchange data and/or documents, such as UBL invoices, over the PEPPOL networks Transactions via PEPPOL are carried out throughout the EU in the public and private sector.
Access to data exchange via the OpenPEPPOL network is obtained through the PEPPOL Access Point. There are now already 80,000 public and private European companies connected to the PEPPOL network.
INPOSIA is a certified PEPPOL Access Point and connects customers to the OpenPEPPOL Network. It makes it possible to exchange data safely and without roaming fees via the Access Point of the recipient. Companies are given a PEPPOL ID with which they can send their e-invoices.
Contact us if you would like to join the PEPPOL network.
In order to switch to e-invoicing the technical and in-house components of your company need to be checked. In addition, the company needs to install an invoice reception point, a digital invoice workflow, and an electronic audit-proof storage system. In addition to the technical aspects these are the main requisites.
The electronic invoice association (VeR) divides the switching process into four steps:
The usual switchover process to e-invoicing is composed of the following phases:
INPOSIA supports you during the switchover to e-invoicing and accompanies you throughout the entire project phase.
Please get in touch with our e-invoicing experts. We look forward to hearing from you. You can call or email us or we would be happy to visit you on-site.