Mandatory e-invoicing in B2B sector will enter into force in Belgium on 1 January 2026 part 2: Peppol Network, scope, fiscal incentives and practical steps

With the Belgian legislation entering into force – please read part 1 about the legislative background, and invoice format requirements - it is time to look at who will be affected by Belgium's mandatory e-invoicing rules and how Belgian businesses can use the fiscal incentives. In this part, we will cover the scope of the e-invoicing mandate and provide a practical guide on what your business should do to prepare for this important shift.

Peppol Network

The Peppol network will facilitate the exchange of e-invoices via ‘access points.” It will be the default standard for exchanging the structured electronic invoices in Belgium. 

It helps to compare it with “telecommunication network” (Peppol network) and “telecommunication providers” (access points). The current e-reporting model is a so-called “interoperability model” or “four corner model.” 

To verify if your customer is already using Peppol, you can consult the Peppol directory (Peppol Directory - Search). The directory is containing Peppol participants IDs which are linked with their VAT numbers.

Both the supplier and the customer will need to choose a service provider to function as “access point”. This could be the accounting software provider or any other provider offering services as “access point” and making to link to the accounting. 

However, upon mutual agreement between both parties (supplier and customer) another standard can be used if it complies with the European standard EN 16931-1. 

The companies can already use the Hermes-platform which facilitates the exchange of structured electronic invoices (the Peppol-BIS format via the Peppol network). This platform may be particularly beneficial for businesses whose customers are not yet equipped to process structured electronic invoices automatically (and/or do not have an “access point” yet) since it can convert them into an easily readable format (PDF) and send them to the customers.

Scope of mandatory B2B e-invoicing

To determine the scope of the e-invoicing three categories should be simultaneously considered 
(1) supplier, 2) customer and 3) transaction.

For any entity, it will be important to perform a screening on applicability of obligatory e-invoicing.

Type of supplier (as issuer of the e-invoice)

The mandatory e-invoicing means that the supplier will become obliged to issue a "structured electronic invoice". This obligation will apply to all Belgian VAT taxpayers. In particular:

• taxable entities established in Belgium (including small taxpayers, no turnover threshold)
• Belgian (permanent) establishment of foreign entities having a Belgian VAT number for performing taxable activities in Belgium
• members of a Belgian VAT group
• taxable Belgian entities benefitting from a special VAT scheme in agriculture. 

The following categories of suppliers are not in scope: 

• foreign taxable entities solely registered for VAT in Belgium (no other Belgian presence) 
• Belgian entities carrying out VAT exempt activities[3] for example certain entities in the financial, educational, social and cultural sector
• Belgian entities which are already declared bankrupt 
• Belgian entities benefitting from the special flat-rate scheme on basis of article 56 of the Belgian VAT code (this special VAT scheme will be abolished as of 1 January 2028).

As soon as a company considers itself falling under the scope, it should still verify the counterparty and the transaction.

Type of customer (as recipient of the e-invoice)

From the perspective of the customer the new obligation means that the customer should be able to receive and process automatically a structured electronic invoice. 

This applies to taxable entities obliged to provide their Belgian VAT number to the supplier for any local Belgian transaction.

Therefore, this concerns all the VAT taxable entities for local Belgian purchases subject to Belgian VAT, including Belgian VAT-taxable entities and the foreign taxable entities with a Belgian VAT number (for the local Belgian transactions). 

Excluded from this obligation are only the VAT exempt entities[4] 

Local Belgian transactions

The obligation will apply to all local B2B transactions subject to VAT in Belgium, unless VAT exempt in the sense of article 44 of the Belgian VAT Code. This entails that supplies under local reverse charge are also in scope of e-invoicing.

By means of example, the following transactions are not included: 

• Intra-Community supplies of goods
• services performed by a Belgian company for which VAT is due in another EU country. This includes works related to immovable property located outside Belgium (for example real estate in France)
• catering and accommodation services performed in another EU country.

Fiscal incentives 

The new legislation introduces some fiscal incentives to promote adoption of the e-invoicing.

Small companies can benefit from a temporary increased cost deduction of 120% on costs related to implementing invoicing programs that enable structured e-invoicing (e.g. subscription fees) and for related consultancy costs. These provisions apply for the taxable periods starting on or after 1 January 2024. 

The deduction cannot be applied anymore as from tax year 2029 (i.e. taxable period starting as from 1 January 2028). It only applies for costs not subject to depreciation and for companies not exceeding more than one of the following criteria during the last closed financial year: (1) annual turnover of €11.250.000, (2) balance sheet of €6.000.000 and (3) annual employee average of 50.Additionally, the percentage for the investment deduction for digital investments regarding electronic invoicing will increase to 20% as from 1 January 2025.

Actions to be taken by any business

To prepare for the obligatory e-invoicing, businesses should undertake several practical steps. 

• Analyse the current invoicing processes in your company. What different systems and departments are being impacted to generate the invoice. This includes the review of the mapping of transactions, VAT treatment and content of the invoices. 
• Verify if all master data of the customers are complete and accurate (official name, official address, and Belgian VAT number). The same applies for the supplier in terms of the data mentioned on the invoice. Correct master data is crucial for seamless e-invoicing. 
• Finally, review your invoicing software to determine its capability to implement e-invoicing, making any necessary upgrades or changes. Verify if involvement of a third-party software provider is required for IT changes (including access point).

These steps will help your company ensure a smooth and compliant shift to the new e-invoicing requirements. Our dedicated VAT team together with all our trusted advisors at Grant Thornton are eager to help you (and any stakeholder within your company) with any queries you may have.  
If you need assistance, feel free to contact us.

[3] In the sense of article 44 of the Belgian VAT code
[4] In the sense of article 44 of the Belgian VAT code