Advivo Accountants and Advisors outline what you need to know about e-invoicing.
Running a business always keeps you on your toes and being paid late is one of the biggest obstacles business owners face. This can make it hard with cash flow, paying your own bills and creates stress in the lives of business owners and their families.
What is e-invoicing?
With e-invoicing, there will no longer be a need for businesses to generate paper-based or PDF invoices that must be printed, posted or emailed. E-invoicing allows a more efficient, accurate and secure way to deal with suppliers and buyers. It is the new way to seamlessly and electronically exchange invoices directly between software systems. It is being touted to provide faster payment times from government and larger businesses as the data is in the right place in their systems sooner.
E-invoicing delivers several benefits for businesses, including:
- Safer and more secure than email
- Received directly into business’ accounting software
- Only seen by the two parties to the transaction and their software providers (not by the ATO) No re-keying and scanning of invoices
- Less chance of errors from the manual processes above
- Environmentally friendly as there are no paper invoices
- Uses business ABN
What will I need to do to make this work?
To ensure your business is ready for e-invoicing, here are some steps to help you:
- Review your current business processes and understand how you currently issue invoices
- How your business could implement e-invoicing
- Understand and manage changes in business processes within your business
- Work with your trading partners to get them ready for the impending change
The Australian and New Zealand governments have agreed to develop a single low-cost e-invoicing standard that all businesses can use so it is consistent for the sender and recipient to use the same invoicing software.
Software providers are currently working on setting this up. Xero is on the list of software providers that are already an accredited service provider. Others are on the list here: https://www.ato.gov.au/Business/E-invoicing/Finding-an-E-invoicing-accredited-service-provider/
We’re excited and anticipate that e-invoicing will save many businesses time, reduce errors, and hopefully get those who deal with bigger businesses paid faster. Watch this space for updates!
For further information on e-invoicing or other areas of your business, please don’t hesitate to contact the Advivo team today.