Tax leaders discuss global e-invoicing challenges and practical strategies for corporate tax teams.
Corporate tax professionals are a lot like daring surfers conquering unpredictable waves as they master electronic invoicing (e-invoicing). By keeping themselves informed and staying ahead of the game, they can ride this powerful wave and push their organizations to new heights of efficiency and compliance.
The monumental shift to digital invoicing has completely changed the way businesses handle global tax compliance. E-invoicing, which started in Latin America about twenty years ago, is now a crucial part of compliance strategies across the globe. As companies dive into the complexities of e-invoicing, they must grasp its challenges and strategies while staying up-to-date with the latest technology.
At Thomson Reuters annual Synergy conference, tax leaders led the session “Worldwide Waves: Riding the E-invoicing Tsunami,” where they discussed global tax compliance challenges. They shared practical strategies for successful e-invoicing, highlighted the importance of technology in improving these efforts, discussed compliance risks, and gave advice on standardizing e-invoicing formats.
Highlights:
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Jump to ↓
| Tax operation considerations when shifting to e-invoicing |
| Create a cross-departmental roadmap for your business |
| Embrace hybrid technology roles for tax operations |
| Maintain local mandates and formats to help mitigate risks |
| Prioritize e-invoicing compliance and leverage tools for global standardization |
Tax operation considerations when shifting to e-invoicing
E-invoicing is currently reshaping global tax compliance, with nearly 100 jurisdictions implementing or preparing to implement these systems. Kathya Capote Peimbert, who represented KPMG at the conference in November, states that tax authorities now have real-time visibility of transactional data. This provides taxpayers with pre-filled tax returns, not only from an indirect tax or VAT perspective, but also from an income tax perspective.
David Welliver, Global Indirect Tax Director at Trimble Incorporated, emphasized the importance of early engagement with stakeholders to navigate these e-invoicing changes effectively.
Here are some basic considerations when shifting to e-invoicing:
- Current processes: How is your organization currently handling invoicing and tax compliance? Are you ready for the shift to digital?
- Adoption challenges: What challenges do you anticipate facing with the adoption of e-invoicing systems?
- Stakeholder collaboration: Who in your organization needs to be involved in the e-invoicing transition process, and how are you ensuring effective collaboration?
- Technological readiness: Is your organization equipped with the necessary technology and skills to implement e-invoicing efficiently?
- Risk management: How is your company preparing to mitigate compliance risks associated with e-invoicing mandates?
- Future planning: What steps can you take today to ensure your company is ahead of the curve in adapting to future e-invoicing requirements?
- Feedback and improvement: What feedback have you received from stakeholders or departments regarding e-invoicing, and how are you addressing it?
Create a cross-departmental roadmap for your business
Implementing e-invoicing is not confined to the tax department. Welliver highlighted the broad range of stakeholders involved. Careful collaboration is needed across various departments, including finance, technology, accounts payable, accounts receivable, and legal.
Capote Peimbert concurred, suggesting the creation of a cross-functional roadmap to ensure everyone is aligned. This roadmap provides everyone with a clear view of upcoming developments, which is essential for effective collaboration. Such teamwork is vital for successfully addressing e-invoicing mandates and ensuring compliance.
Embrace hybrid technology roles for tax operations
In the digital age, technology has evolved from a luxury to an essential element in tax compliance processes. Artificial intelligence, machine learning, and automation have become fundamental components of e-invoicing systems. With e-invoicing, comes the digitalization of the end-to-end compliance process. Capote Peimbert warns that technology is no longer a “nice to have” option; it’s an actual requirement for today’s businesses to succeed.
Welliver added that the need for new skill sets is prompting companies to hire hybrid roles such as “tax technologists.” These individuals understand tax regulations and have a strong grasp of technology, including skills like coding.
Maintain local mandates and formats to help mitigate risks
One of the most significant compliance risks in e-invoicing is the potential inability to complete transactions if businesses fail to adhere to regulations. As Welliver pointed out, when e-invoicing regulations are enforced, non-compliant businesses may find themselves unable to transact with their customers or vendors, emphasizing the critical need to adhere to local mandates and formats.
Combating e-invoicing complexities across multiple countries can be daunting. However, businesses can take advantage of tools that help standardize formats while still complying with local requirements. Capote Peimbert highlighted that using schemas, such as those offered by major solution providers like Thomson Reuters, can help streamline this process. These providers offer “canonical invoices,” which simplify compliance by aligning with diverse regulatory standards.
Prioritize e-invoicing compliance and leverage tools for global standardization
Capote Peimbert warns that non-compliance not only disrupts business operations but also results in significant fines and penalties, making adherence to new e-invoicing mandates an urgent priority. Solutions like Thomson Reuters ONESOURCE Pagero are invaluable in this context. They provide real-time updates on regulatory changes and offer integrated platforms that ensure seamless invoicing across jurisdictions.
By prioritizing compliance and utilizing these tools, businesses can mitigate financial risks and enhance operational efficiency. Consider evaluating your current e-invoicing strategies and exploring these solutions to stay ahead of regulatory changes.
As e-invoicing continues to gain traction globally, corporate tax professionals must stay informed and proactive. Engaging stakeholders early, embracing technology, and leveraging tools for standardization are key strategies for navigating global tax compliance. The insights shared by Capote Peimbert and Welliver in this session highlight the importance of collaboration and technological integration in achieving compliance success.
As businesses ride this e-invoicing wave, understanding and adapting to these changes will be crucial for maintaining compliance and achieving operational efficiency.
Ready to dive deeper into the world of e-invoicing? Watch the full Synergy conference session “Worldwide Waves: Riding the E-invoicing Tsunami,” to gain additional insights and strategies.
