E-invoicing or electronic invoicing is becoming largely popular in Australia. Just last month, the government issued new proposals entailing the development of Business eInvoicing Right (BER).
The proposal will make it mandatory for a vendor to accept as well as adopt eInvoicing if their trade partner sends them its request. This insinuates the slowly changing dynamic of completely shifting to eInvoicing in the near future.
On speaking about the importance of this move, superannuation, and Financial Services Minister, Jane Hume said:
“It is estimated that every time an e‑invoice replaces a paper or emailed PDF invoice, the businesses involved in the transaction can share more than $20 in cost savings per invoice.”
DSPANZ spokesperson, Mathew Lewis further added,
“E-invoicing is transformational for Australian businesses, particularly small businesses, as it is good for cash flow and facilitates five-day payment terms. It’s also more secure and reduces the chance of invoice fraud. The BER will improve the e-invoicing system by allowing those enabled to be discoverable.’’
What is eInvoicing?
E-invoicing is the digital exchange of the invoice that is stored and transferred in a standard format. It is a legally accepted form of invoice and is widely being accepted in many parts of the world. The digital form makes it highly convenient to send invoices without having to worry about physically mailing them. It saves bucks as well as time.
Many digital service providers have started supporting eInvoicing. A number of software programs including Xero now have eInvoicing support features.
Some of its noteworthy benefits include:
Cuts down on costs
One of the greatest benefits to reap out of this new form of invoicing is its cheaper costs. Sellers usually spend about $27-30 to create and process the printed PDF invoice. With eInvoicing, the entire process will cost you about $10 per invoice.
To break it down further, since the entire process will be automated the cost of having to create a PDF paper print version, scanning it in order to manually add it to the software, and using paper and other material for it won’t even exist.
Less room for errors
Like other forms of documents, eInvoicing also follows a set standard in terms of its format. The invoices are prepared digitally in the most accurate way minimizing every type of error. The data is also checked before the final version is sent further. Also, as there won’t be any need to re-type manually or scan to enter it in the software, there will be even less room for errors.
With digital forms, the risk of security breaches arises. E-invoicing is highly secure as the eInvoices are transferred through the Peppol network with its approved access points. This exchange of eInvoices uses the ABN numbers of the two parties, making it even more reliable. This means of invoicing also minimizes the risks of getting fraudulent and scam invoices as the transfer is highly secure. These invoices are well-protected so there is also a lesser risk of losing data. Moreover, these eInvoices cannot be seen by anyone (not even ATO) other than the two parties involved in the exchange.
The government is encouraging it
One of the reasons why every business should turn to eInvoicing is that the government is encouraging it. As mentioned by ATO,
‘’NSW government has mandated eInvoicing for all government agencies by January 2022.’’
It won’t be long before all other states adopt it too.
In a nutshell, eInvoicing is here for good. Businesses can benefit a lot from this highly convenient invoicing option while staying at the top of their game. Talk to your service provider today and see if they provide eInvoicing.
Keep coming back to this space for more details.
Until then, it’s a wrap from us!