When it comes to invoicing, a major change is about to shake up the French business landscape. From July 2024, new regulations will come into force, requiring all companies to issue electronic invoices. It's a complicated subject, but don't panic, we're going to decipher it all together.
1. What exactly is an electronic invoice?
Electronic invoicing, also known as e-invoicingis no novelty in itself. However, it will undergo a major transformation from 2024 onwards. No longer content to be simply an electronically signed PDF or an invoice accompanied by a reliable audit trail, it will now have to be composed of a structured data file, an XML schema, and transmitted via a platform or portal. In other words, companies will no longer be able to send invoices directly to their customers. Instead, they will have to be sent via a portal, so that the tax authorities can capture the information they deem relevant.
2. Why this reform?
The main reason for this reform is to combat VAT fraud. The aim is to halve the annual loss of around €20 billion. In addition to this, it is also a European project. The European Commission is currently working on a directive on VAT in the digital age, which includes the generalization of e-invoicing requirements throughout the European Union.
3. Who is affected?
All companies located in France will be affected by this reform. They will have three major obligations: to use new invoice formats, to use a public portal or a private platform for submitting and receiving invoices, and to periodically transmit a report, the e-reportingto the tax authorities.
4. When should it be implemented?
The reform will be phased in according to company size. Large companies will be the first to be affected, starting on July 1, 2024. Intermediate-sized companies (ETIs) will have to comply by January 1, 2025, and small and medium-sized businesses by January 1, 2026.
5. What invoice formats are allowed?
Three invoice formats will be authorized: PDF with qualified signature, EDI fiscal and Factur-X. The latter is particularly interesting as it is a hybrid format, combining the PDF we already know with a structured XML file. It will make it possible to maintain the formatting of current invoices (logo, colors, images, etc.) while associating the structured data required by the tax authorities.
6. What is e-reporting?
E-reporting is a periodic report that companies must submit to the tax authorities. It will contain information on sales to individuals and international sales operations, as well as information on receipts from sales of goods and services. The frequency with which this report is transmitted will depend on the company's VAT regime.
7. What are the risks of non-compliance?
Failure to comply with these obligations can result in financial penalties. For failure to issue invoices in the correct format, the fine is 15 euros per invoice, capped at 15,000 euros per calendar year. For failure to issue tax flows (e-reporting), the fine is 250 euros per missed transmission, also capped at 15,000 euros per calendar year.
8. How can we prepare for this reform?
Management software publishers are currently adapting their solutions to meet these new requirements. They play the role of dematerialization operators and will support companies in this transition. In addition, the Chorus Pro public invoicing portal will be transformed into a Public Invoicing Portal (PPF) to centralize all invoices and enable the tax authorities to capture the necessary data.
This reform of electronic invoicing represents a real challenge for French companies. Yet it is essential in the fight against VAT fraud and the harmonization of practices on a European scale. It is therefore essential for companies to start preparing now to implement these new invoicing methods.
