Corporates in KSA, UAE & Egypt have started their journey towards mandatory e-invoicing
As a business owner, you might have heard of e-invoicing. It’s not just a trend, but rather it’s becoming mandatory to use e-invoicing systems whether you are registered as a company or an individual in KSA, UAE, Egypt and other GCC countries. The main reason behind this quick move towards digital invoices is to increase the speed and efficiency of transactions by reducing paperwork and redundant processes.
The invoice data would then be sent to the taxation department using a secure web service or a secure file transfer protocol. All of the invoice data will be stored in a central government repository and will be accessible by the taxable person as well as tax authorities on real time basis and available for analytics. This system will bring about a more transparent transaction between the buyer and seller, with both parties keeping receipts of the same throughout their business relationship.
The system will benefit businesses by offering services that include issuing and receiving e-invoices, e-signature, and e-seals. The system should also support digital wallet invoice issuance and collection. By embracing and deploying the concept of e-invoicing, businesses will be able to enhance control over their financial operations by reducing the time it takes to process incoming/outgoing invoices.
How does the e-invoicing system work?
A ‘registered person’ has to issue an e-invoice to a ‘recipient’ for supply of goods or services. The invoice with the data will be created on the Invoice Registration Portal (IRP) and then generated in the form of an Invoice Reference Number (IRN).
A QR code is created by IRP and sent to the recipient through email. The recipient has to verify details through IRP using IRN and QR code that can be scanned through any device with a camera, without a barcode reader. An authentication number is auto-generated by IRP after verification.
Companies impelled to use the e-invoicing system will be needed to register to the governmental system. After successful enrollment, the customer information will be handed to transmit checks and invoices in XML or JSON data format.
The system will allow the cancellation and rejection of invoices that have been issued wrongly. Information similar as the tax identification number, national ID number, name, and fireside of the seller are needed in the purchase invoice. VAT declaration will be automatically filled via invoices.
Each invoice is digitally issued by a HSM (hardware security model) device and receives a unique ID to guarantee data security of the transactions between companies.
The new e-invoicing standard implements a separate scheme for credit and debit notes. It also includes a reference to the original invoice, by providing its unique ID.
For the products supplied, the e-invoicing standard will be based upon the GS1 coding system or an internal coding system linked to the Global Product Classification standards – and their use will ensure all the necessary data is included on a single line.
Digital transformation is a key step for companies that want to stay competitive in today’s global market, but the effort can be significant. TKMind’s new localization feature makes it easy to adapt your e-invoicing solution to match the requirements of your different markets and corporate cultures.
You can:
• Streamline and automate all of your AP/AR invoicing processes – no matter the size or technical maturity of your business. With a single platform, you can quickly create, issue and track multi-part invoices, manage supplier relationships and comply with legislation in a simple yet secure environment.
• Our e-invoicing solution is designed to address the challenges of the ongoing digital transformation. It is fully compliant with the latest data exchange regulations and modern data transfer standards, so you can focus on doing what you do best—staying competitive.
• With its digitization of invoicing and data, e-invoicing is a pioneering innovation that offers you a wealth of advantages. Its innovative functionalities such as Self-Billing (electronic billing), e-Archive (electronic storage and archive), electronic signature, data validation, format conversion and multichannel distribution allow you to manage data in a way that is both effective and in line with your needs.
If you want to check more benefits of our e-invoicing solutions, please Contact Us.