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Are online accountants ready for cross-border invoicing?

Are online accountants ready for cross-border invoicing?

You may be aware that new EU cross-border invoicing and VAT directives come into force in 2013, but there is now concern that these are open to interpretation.

According to figures from HMRC, UK businesses rely heavily on business from the EU so it is imperative that accountants keep their clients updated with any changes to the legislation or cultural requirements. Strong processes will also need to be put in place to ensure e-invoice documents are protected.

The new EU directives are supposed to simplify invoicing legislation and remove existing barriers. Paper and electronic invoices will be treated in the same way and companies will have the choice of which method to use.

The legislation addresses the need for invoices, the content, invoicing electronically and invoice storage. It also provides recommendations for a modern set of VAT invoicing regulations.

EU countries currently differ when it comes to their expectations regarding invoices. In Southern Europe they rely on PDF formats and place emphasis on design. In Northern Europe, businesses want invoices that can be read by both humans and machines.

The majority of companies will have solid processes in place for their paper based invoicing but there have been problems agreeing electronic processes and these could lead to payment delays. In order to comply with the EU directives, companies will need to set up systems that guarantee invoices cannot be tampered with and that the information stored meets the legal requirements of the country concerned.

If the Revenue does not believe a EU invoice is genuine, the company may have problems reclaiming VAT and may be subject to an in-depth investigation. Other EU tax authorities will also be able to demand access to invoices to verify their integrity.

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Image: Crossing the Line by dobrych

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