E-invoicing is an electronic invoice sent electronically over the internet. Rather than being paper-based, they can be easily integrated into customers’ account payable systems.
Electronic invoices simply mean a scanned form of a printed invoice, these electronic invoices have varying standards from country to country. The standards come from EDI standards listing the rules for how electronic invoices are created and transferred.
E-invoices are structured, tax compliant, authenticated invoice data that is issued from a supplier to a buyer and this is the invoice relevant to tax auditors or authorities.
What are the benefits of e-invoicing?
Electronic Invoicing comes with a large number of benefits such as:
- reduced costs
- faster payments
- removal of manual processing
- increased accuracy
- improved visibility
- improved compliance
This is just to name a few. However, one of the most notable benefits of e-invoicing is the level of integration you and all organizations within your business require.
What is global e-invoicing?
This is a commonly searched term ‘Global e-Invoicing’ here’s what it means. Due to government regulations, internationally active companies are obliged to create and send their invoices electronically, yet every country has differing legal obligations. This causes international e-invoicing to become quite complex, as in all 65 countries e-invoicing regulations have subtle differences with the way in which the data is collected, how this must be collected and what requirements need to be met by a digital signature.
Which operating model is best for your e-invoicing?
Many say that converting to e-invoicing is the most efficient option but every business may differ. In turn, every company should analyze whether their current level of e-invoicing projects brings the expected benefits.
Here are a couple of options for operating models regarding e-invoicing and what question you’ll have to answer to know if it’s right for you.
Hosting: Is the e-invoicing solution located in your own data center or does the operation need to be outsourced to a data center operator?
Operating Mode: Does the solution need to be operated as a licensed product on-premises? Or as a cloud-based service on a pay-per-use basis?
Standards and Formats: What e-invoicing standards and formats do I need now and in the future?
This should help narrow down what model is best for you regarding e-invoicing if you have any questions please get in touch with B2Be today.
What are the types of invoices?
- Standard Invoice: This is the most common form of invoice and is flexible to fit most industries and billing cycles. This is issued by a business and submitted to a client
- Commercial Invoice: This is issued by a business for goods that it sells to customers internationally
- Timesheet: A timesheet invoice is used when a business or employee is billed based on the hours worked and their rate of pay
- Recurring Invoice: These are common among IT businesses that charge their clients the same amount each month for a service. Recurring invoices are used for businesses that charge clients the same amount for their services periodically
- Pro Forma Invoice: This is an estimated invoice that a company sends to a client before providing services, providing customers with an estimated cost of the work to be completed
- Debit Memo: Also known as a debit invoice, this is issued by a business that to make a slight adjustment to an existing bill
- Mixed Invoice: This is the combination of credit and debit charges on a single invoice and the amount can be expressed as either a positive or negative number
- Interim Invoice: This is used for large project billing where terms have been agreed that may include multiple payments
Is an invoice a receipt?
Simply, an invoice is a request for payment whereas a receipt is proof of payment. Customers commonly receive invoices before they pay for a product and then receive receipts after they pay.
Both are either paper or electronic slips detailing purchase transactions and therefore are not interchangeable.
Elements each invoice must include:
An important thing to note is what must be included in an invoice either electronic or paper. We have comprehensively listed these below:
- The word Invoice
- Seller’s name and address, contact details, and company registration number
- Buyers name and address
- Date: issue date, payment due date, and delivery date
- A unique invoice reference number
- Description of services or products
- The total amount charged with Tax Information
- Available payment methods, such as bank account number and also a reference code to identify the customer
Automate and streamline your organization’s e-invoicing environments and improve processes, increase throughput, and therefore allow accounts payable and accounts receivable environments to focus on adding value. Contact B2BE today!