Under the current rules, EU Member States must accept electronic invoices provided that the authenticity of the invoices’ origin and the integrity of the content are verified by an advanced electronic signature or by electronic data interchange. EU Member States can also opt to accept other electronic means.
The second VAT Directive on VAT invoicing—which aims to simplify invoicing rules—was adopted in 2010. The second VAT Directive aims to eliminate current barriers to e-invoicing by treating paper and electronic invoices equally.
Under the new rules, the authenticity and integrity of invoices can be established by any reliable business controls that create a “reliable audit trail” between an invoice and a supply and allow for a determination of the legibility of the invoices—including advanced electronic signature and electronic data interchange.
The second VAT Directive also amends the deadline for issuing invoices, which can currently vary between immediately on the date of the sale and six months.
According to the second VAT Directive, the deadline will be the 15th day of the month following the intra-community supply of goods or cross-border services subject to the reverse-charge mechanism.
The VAT Directive also standardizes the language to be used on invoices to indicate that a sale is exempt, zero-rated, or subject to a country-specific regime.
A majority of EU Member States are currently discussing their budgets for the next year, and it is expected that the changes will be implemented with the upcoming finance bills.
Several Member States have already implemented the VAT Directive into their law—including Portugal and the Slovak Republic. The new invoicing requirements are to be effective 1 January 2013. Portugal implemented the changes with an effective date of 1 October 2012.