The main goal of introducing the obligatory e-invoicing is to reduce the VAT gap and to combat the VAT fraud. E-invoicing offers numerous benefits, including
It should enhance efficiency by enabling faster processing and hence payment of invoices, reducing administrative compliance (burdens) by reducing errors and ensuring all transactions are correctly reported by both the supplier and the customer (when combined with e-reporting).
Additionally, it simplifies VAT administration and compliance, enhances transparency and harmonisation across all EU countries. E-invoicing supports digital transformation, making it more efficient and dependable for both businesses and tax authorities.
The bill of 6 February 2024, as published on 20 February 2024, introduces mandatory B2B invoicing in Belgium. Prior to the entry into force of the European project “VAT in the Digital Age” (ViDA)[1], member states need to get approval from the European Council to implement obligatory e-invoicing on a national level. Belgium is currently still waiting for the approval by the Council of the European Union. However, it is expected that approval will be granted, as also other EU Member States have received an approval for obligatory B2B invoicing for local transactions.
It is important to note that even though implementation of e-invoicing can be a first step towards real time reporting, based on the new legislation it will not entail any digital reporting obligations in Belgium yet. That means that the invoices will – at least in a first phase- not be submitted towards, nor validated by the authorities.
As we will zoom into later, the Belgian e-invoicing systems focus on local transactions taking place in Belgium and is hence linked to receiving a valid Belgian VAT number from the taxable customer.
Introduction of e-invoicing in Belgium is consistent with the European project “VAT in the Digital Age” (ViDA). Currently, the ViDA proposal (last version of May 2024) is on the agenda of the ECOFIN[2] meetings. During the meeting of 21 June 2024 an agreement could not be reached between Member States. The blocking element was the objection of Estonia on the “Digital platform for deemed suppliers”.
On the ECOFIN meeting of 5 November 2024 an agreement has been reached since Estland obtained a waiver until January 2030 (unless voluntary as from 2028) for the proposed new VAT rules on “Digital platform for deemed suppliers” (relating to passenger transport and accommodation). Now, there will be an update of the legislative text which will be sent to the European Parlement for their opinion due to the substantial changes (earlier advice dates from 22/11/2023). As a next step, the updated legislative texts will need to be formally adopted by the Council before being published and entering into force.
The objective of ViDA is to modernise the EU VAT system and adapt it to the new challenges of the digital economy. According to the ViDA proposal e-invoicing will become mandatory in the framework of Digital Reporting Requirements (e-reporting) of cross-border transactions. E-invoices will need to be issued withing 10 days following the chargeable event.
According to the new Belgian legislation a ‘structured electronic invoice’ is defined as “an electronic invoice drawn up, sent and received in a structured electronic format that enables its automatic and electronic processing.”
Structured electronic invoices (hereafter called ‘e-invoice’) will be issued in Peppol-BIS format and exchanged via the Peppol network. The Peppol network is already used for B2G transactions. This e-invoice needs to comply with the EN 16931-1 and CEN/TS 16931-2 standards.
In practice, a structured electronic invoice will take the form of an XML file, which enables it to be processed automatically. Invoices in PDF-format will not be considered as a “VAT compliant invoice” in the B2B context.
This means that there is a risk for the supplier of getting penalised by the Belgian VAT authorities with a lump-sum VAT penalty per incompliant invoice. Even more importantly, there is a commercial risk for the customer. During a Belgian VAT inspection at the customer’s, the Belgian authorities can reject the VAT deduction right, impose a 10% VAT penalty and claim interest for late payment (currently at 0,66% per month).
As Belgium moves towards mandatory e-invoicing, understanding the legislation and preparing early will help your business avoid penalties and stay competitive. Do not wait until 2026 to start preparing—ensure your invoicing system is compliant now.
In the next part, we will explore the scope of mandatory B2B e-invoicing, available fiscal incentives, and the key steps businesses must take to ensure compliance. Stay tuned for practical insights to help your company transition smoothly.
[1] currently foreseen in 2030, however not approved yet by all member states.
[2] Economic and Financial Affairs Council of the European Union (EU)
