The state encourages the adoption of e-invoices
October 2024
At the end of September 2024, the Parliament of Estonia approved the amendments to the Accounting Act (Amendments to the Accounting Act 428 SE). The aim of this act is to support the wider adoption of digital invoicing in the private sector and to encourage the use of the European standard for e-invoices in Estonia.
So far, the general requirement to submit e-invoices has been valid in Estonia only if the buyer has been a public sector institution. According to the adopted draft law, the buyer's right to choose the form in which they want to receive an invoice from the seller will apply from now on. The right (but not the obligation) to demand an e-invoice from the seller will be extended to all accounting entities within the meaning of Accounting Act which have registered as recipients of e-invoices in the e-business register.
Therefore, not only public sector institutions, but also private sector companies have the right to demand the submission of e-invoices in the future, if they have registered themselves as recipients of e-invoices in the e-business register.
The procedure for registering as an e-invoice receiver in the business register is also simplified. Under the current regulation, the registration in the business register is initiated by an e-invoice operator operating in Estonia, who has been authorised by the respective accounting entity under an existing agreement. In the future, however, the accounting entity itself may submit the corresponding application to the business register.
In addition, the amendment provides for the elimination of the existing double standard for e-invoices. At the moment, the Accounting Act stipulates the parallel use of two technical standards: the Estonian standard or the European standard. In the future, the law will only support the use of the European e-invoicing standard by default. Even though the reference to the Estonian standard is removed from the law, the principle of transaction and format freedom remains valid: the format and submission conditions of the original document are usually agreed between the transaction partners. According to the explanatory letter to the draft, the obligation to use the European e-invoice standard exists by default if the buyer requires the seller to submit an e-invoice and the parties have not agreed on another format. The draft does not prohibit the further use of any existing invoice format.
The changes will enter into force on July 1, 2025. The draft with an explanatory letter is available in Estonian here.
Author: Martin Tois
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