Earlier in the article about the changes concerning the Accounting Act we have already mentioned the changes concerning electronic receipts which enter into force as of January 1, 2013. We would like to further discuss this topic because of its importance.
The European Commission and the electronic receipt
The European Commission published its document called “Exploiting the advantages of electronic invoicing in Europe”. Based on the data of this document, at the time of its adoption, e-invoicing was used only in 5% of the territory of the European Union. However, the study pointed out that transition to electronic invoicing would result an estimated EUR 240 billion savings at EU level. E-invoicing – as envisaged by the Commission – shall become the main mode of invoicing by 2020 in the single Europe.
The document sets out the benefits of e-invoicing:
• shortening payment times
• reduction in the number of errors
• reduction in printing and postage charges
• fully integrated processing
The main advantage of e-invoicing lies in process automation since after issuing invoices in a structured format, they can arrear both in the issuer’s and the recipient’s system directly and automatically.
However, it may not be a negligible factor that – through its positive environmental impact – e-invoicing may reduce carbon dioxide emission in the European Union by around 1 million tons a year.
In the document the EU has set out the main priorities for the spreading of e-invoicing:
• providing common legal environment
• helping mess-market penetration through small- and medium-sized enterprises
• establishing the maximum possible coverage of environment
• promoting the development of a standard e-invoicing model
• promoting e-invoicing at national level
Member States shall submit the attainment of the aims being pursued and the progress made as a result of measures taken to the Council and the European Parliament until the end of 2013.
According to the recommendation the amended legislation concerning e-invoicing has come into force on January 1, 2013
The definitions of electronic invoicing according to the applicable law
Electronic invoice: a document which contains the mandatory content elements of an invoice as defined in the legislation and was issued and accepted electronically. It means that beside the previous advanced electronic signature and invoicing based on electronic data interchange system, all electronic invoicing systems are acceptable which meet the above requirements for invoices.
The date of the issue of e-invoices: the date from which the invoice is available to the recipient that is the recipient can inspect and download the document made available with the access information.
However, parties shall agree on the use of the Electronic Data Interchange System EDIS) in advance and in writing in case of EDIS-based invoicing. In other cases the condition for the application is the consent of the invoice receiver.
Principles concerning invoicing
VAT Act 168/A §.
(1)“From the date of issue of the invoice until the end of the storage period the authenticity of the origin and the integrity and legibility of the invoice shall be provided.”
The authenticity of the origin means the provision of the identifiability and identity of the supplier, service provider and issuer of the invoice.
Content integrity: the data of the invoice have not been changed.
The principle of readability: the invoice shall contain a notation which allows for the accurate interpretation of the indicated information without any particular explanation or a more thorough investigation.
(2) Any business control procedure which provides a reliable audit connection between the invoice and supply of goods or services may meet the requirements mentioned in paragraph (1)
A reliable audit trail means a reliable and established relationship between the invoice and the transaction. In the accounting policy and its annexes (e.g. document order) it is necessary to record the elements of the electronic documentation from the starting date to the end of the transaction, connecting the source documents and the related transactions and fixing the references related to their relationship.
Ensuring invoice control
The Tax Authority has recorded in a separate regulation (46/2007. (XII.29.) Annex 2 of the Regulation of the Ministry of Finance) the possible formats of submission obligation in case of e-invoicing related to documents provided for in the Tax Code. The formats include but not limited to: .txt, .csv, .dbf, .mdb , .xls , .xml
Law CXXVII of VAT Act of 2007 on VAT
Law XCII of Tax Code of 2003 on tax rules
European Commission COM (2010) 712 Brussels, 12.02.2010
Dr. Gábor Rónai’s Article from Adó Online (Tax Online)