How software companies can simplify e-invoicing integration and maximize profit

As mandates for B2B e-invoicing start to spread across the European Union, this topic is rising rapidly up software companies’ agendas. New technological regulations are a gift to the companies who implement them. But capitalising on these opportunities, in a way that keeps clients happy and profit margins healthy, requires both good grasp of the basics and staying up-to-date on likely changes. On 7 May 2024, we held a webinar in which two e-invoicing experts shared knowledge and advice for helping software companies navigate the challenge.

The panellists

• Isabelle Desmeytere – former owner of the iVAT suite of VAT compliance software and services, and member of several EU workshops
• Jurgen Soetaert – founder of Digicrowd and API expert at Isabel Group

E-invoicing definition

Isabelle began by clarifying what e-invoicing actually is, and isn’t.

“If we step back 10 years, it was typical for many businesses to print invoices on paper, put them in envelopes and send out to customers by post. While some still do this, most have moved on to sending PDF files by email. Yes, this involves electronic transmission, and it is digital, but it isn’t e-invoicing. A PDF is an electronic version of a paper invoice, which is designed for humans to read. Whereas an e-invoice is a structured file that only machines can read. The machine-readable format is an essential e-invoice characteristic.”

Where and how e-invoicing is becoming mandatory

One of the reasons e-invoicing is such a hot topic is the raft of mandates coming into effect across the EU.

Jurgen explained that, following a first wave of mandates applicable to B2G transactions, mandatory B2B e-invoicing is now being introduced country-by-country, with 2026 as a target year for many.

Isabelle then filled us in on where and how B2B e-invoicing has been, or is being rolled out as a legal requirement across the EU.

“The first EU country to make e-invoicing mandatory was Italy in 2019. In Italy, suppliers send their e-invoices to the Italian tax authorities, who register the details in their system before forwarding the e-invoices to the relevant customers. It’s a fully controlled process, with the e-invoices conforming to an Italy-specific format.

“Poland was supposed to go live this year, but their e-invoicing mandate has been postponed to February 2026. Like Italy, Poland has its own format and requires e-invoices to be sent via the tax authorities. However, rather than forwarding the e-invoices directly to customers, the Polish authorities just make them available on their own web portal for the relevant customers to collect.

“E-invoicing was due to be made mandatory in France earlier this year, but has also been deferred. The situation in France is complicated because there are two different systems in operation. One is similar to the Polish and Italian approach, whereby the e-invoices are sent via the tax authorities. The other allows suppliers to send e-invoices directly to customers who, in turn, are obliged to e-report the data to the tax authorities.

“Germany is, in principle, also on the radar for making the ability to . The German approach does not involve data reporting to its tax authorities at any stage in the e-invoicing process. Germany is not planning to stipulate any specific networks through which e-invoices have to be delivered.

“Belgium has January 2026 in its sights for mandatory e-invoicing, following the German approach in as much as e-reporting to the tax authorities won’t be in the mix. However, Belgium will specify how e-invoices have to be formatted (although business partners could opt to use another format just between them), as well as requiring all e-invoices to be transacted via the Peppol e-delivery network.”

Isabelle, who was one of the authors of an underlining study on which the legislative proposal for ViDA was drafted, said: “The proposal is actually a starting point for e-invoicing to become mandatory for intercommunity supply – transactions between parties in different member states – and for e-reporting of invoicing data to both parties’ tax authorities in this context.

“So, e-reporting to tax authorities will come into the mix in every country, at least in the context of cross-border transactions, even if their own individual mandates don’t require it.”

Mandatory e-invoicing is an all-round win

Jurgen talked through the rationale behind e-invoicing mandates.

“For governments, e-invoicing is an opportunity to increase tax revenues by shutting down VAT fraud and closing the so-called VAT gap. To give you an idea how much is currently going missing, in Belgium alone we’re talking about 3.5 billion euros a year.

“But it’s not only governments who win. E-invoicing will save businesses a huge amount of money and time, as it enables invoice processing to become far more detailed and efficient. There’s a saving of €3.50 to be made on every invoice that’s switched from paper to e-invoice. That can add up to a huge amount of money per enterprise, and across the country as a whole.

“In the short term, companies will need to invest in technical solutions. But in the mid to long term, governments will be able to collect taxes more efficiently and effectively, while companies will spend less time and money processing both their outgoing and incoming invoices. Invoices will no longer go missing in the post. Direct machine-to-machine transaction and processing will cut down invoice fraud while resulting in faster and shorter payment cycles, as well as a lower administration workload, especially on the accounts payable side.”

Isabelle did, however, challenge the universal notion of government gains, pointing out that tax gaps will only be closed when e-reporting to tax authorities is in the mix. Belgium’s and Germany’s e-invoicing mandate proposals do not include this. Their tax authorities do not gain any visibility, so it’s hard to see how mandatory e-invoicing will boost tax revenues in these two countries. Specifically for Belgium, she also noted that mandatory e-reporting to tax authorities would further benefit businesses as they would no longer have to file customer listings every January.

“Spain also has an interesting proposal on the table, which would mandate shorter payment periods to small and medium-sized businesses. Slow payers are a real burden for smaller businesses, so addressing this, along with the issue of identity fraud, which is another e-invoicing advantage, will be very helpful both to businesses and to the economy.”

The role of software companies in facilitating e-invoicing

E-invoicing brings the ability, and need, to automate invoice sending, receiving and processing. The structured nature of e-invoices, which makes them unreadable to humans, means software companies are needed to configure business software to handle all this, as well as facilitating connectivity with e-delivery networks.”

Most e-invoicing mandates stipulate that e-invoices need to be sent via an approved e-delivery network. This requires affected business to subscribe to a network. There are several to choose from but, given the trajectory of the various mandate proposals, just one stands out as the common denominator moving forward: Peppol.

Jurgen: “Peppol, which is an initiative from the EU commission, is very widely adopted across Europe. It is secure, standardised, and capable of expanding from its present state as a four-corner model to incorporate a fifth corner, which can be used for e-reporting to tax authorities.

“Using Peppol is a bit like using a telecoms network. Even if the other party you’re communicating with is with a different provider, you can still connect and nobody has to worry about the technicalities behind it. For telecoms, each user has a unique telephone number. With Peppol, each party is identified by its own enterprise number, and these enterprise numbers each need their own access point. When a party sends an e-invoice, the sender’s access point checks if the recipient’s enterprise number is reachable through and, if it is, delivers the e-invoice.” 

Connecting into Peppol via an access point is another task for software companies, and this can be done in several ways. 

Jurgen: “Compared to custom-made integration or via classic EDI setups, as was common in the past, implementing an off-the shelf API saves a lot of time and money. This solution also makes maintenance much simpler, while maintaining compliance with ever-changing legislation, because these burdens fall to the API provider. I’d say that using an off-the-shelf API for connecting into Peppol is software companies’ best bet for keeping things simple and turning a profit.”

Preparing for the future, when common standards are not yet established

When asked how to avoid common pitfalls encountered by software companies, Isabelle identified a lack of clarity about future format requirements as a notable challenge. 

“The biggest recommendation I can give software suppliers is to make sure you’re covered for every possible content or data element. Look at what all the various governments in play are asking for, in terms of both mandatory and optional fields, and set up your formatting to allow for it all. Data elements can easily be removed or ignored at a later date, but adding them in is much harder. By having every eventuality in your playbook, your software will be future-proof for whatever national or common standards emerge, and you can get developing while the authorities are still making their minds up.

“Then of course, you need to make sure the connection method you’re using into your e-delivery network, for example an off-the-shelf API, can also handle all those data elements. And I mean all. 80% isn’t good enough. Only 100% capability will ensure compliance for your users. If we take Belgium as an example, the format that will be required has not yet been announced, but you can already take UBL 2.1 and Peppol BIS as starting points, even though the list will be extended.

“Given that Belgium is expected to introduce its mandate in January 2026, it’s a good idea to get started now, as that date is not far away in terms of having everything ready and tested, and users trained up.”

Will upcoming mandates allow multiple formats?

In response to a question from the audience, Isabelle talked about whether upcoming mandates will allow for multiple formats.

“At the very least, there will be a choice between UBL and CI, but there will be other possibilities. I personally think UBL will be very prominent, and it will then the task of the software or service providers to convert it. I don’t think there will be a whole multitude of formats to convert. In Belgium, for example, it will be something a bit different from ubl.be or, but not that much different. So, if you’re operating in Belgium, I’d say start with these two and you’ll be heading in the right direction.”

Jurgen added “I think that if you go with Peppol BIS 3.0, as Isabelle mentioned, you’ll also be heading in the right direction for the whole of Europe.”

Can an organisation that uses different billing programs work via different Peppol access points?

Jurgen: “It all depends on how the access point treats the enterprise or company. For example, in Codabox-Isabel Group we don’t subscribe senders to the Peppol network. But there are some access points in Belgium who do, and this can create a conflict because each enterprise can only be subscribed once. I mainly see this problem originating on the receiving side, because all receiving access points subscribe the organisation as a receiver in the Peppol network, and that locks them in. Looking to future, there will be interoperability between networks, which will enable enterprises to have a choice. 

“On the sending side, there is a conflict when it comes to message response. Because each enterprise can only be subscribed once, all feedback now goes back to its single registered enterprise number. For the future, it has been agreed at EU level that this feedback won’t be returned at enterprise level, but at access point level. So the access point will be able to give MLR feedback to multiple software packages. The access point will be regarded as the invoice distributor, but it can apply to several locations.

“Interoperability between access points is a major topic being discussed at European level. Right now, it is a manual process, with enterprises having to state that they don’t want to be subscribed at a particular access point, but at another of their choosing. But in years to come it will be automated. The more common e-invoicing becomes, the more interoperable it will have to be.”

Immediate and ongoing opportunities for software companies

The webinar ended with a question about how software companies’ roles in e-invoicing will evolve, particularly in the light of emerging technologies like AI and blockchain.

Jurgen: “I see software companies continuing to have a role in improving automation of document processing, with AI or blockchain adding value on top. For example, in Isabelle Group, our Clearfacts pre-accounting solution has a ‘confidence level’ functionality which can advise users on expected automated bookkeeping accuracy. When a user sees a report of 80% confidence, they don’t need to review the results. I foresee further evolution in that direction because there’s a lot of data to keep on top of, and it is time to do something about this.”

Isabelle added: “The e-invoicing obligation paves the way for all this, because if you don’t have your data structured in a machine-readable format, you can’t do anything with AI or blockchain. For smaller companies, this might seem frightening in terms of costs and the need to change existing processes. But I do think that, looking to the future, this legislation is to be welcomed.”

Jurgen continued: “About 50% of smaller companies’ invoicing is being done in Excel and on paper, so they will have to choose the right software or ERP. This is something that software companies can pay attention to right now, and I mean within a year. That’s why it is important to start working on it, creating awareness and providing approachable solutions.”

In summary

Upcoming mandates for e-invoicing across the EU give software companies an opportunity to shine by providing solutions for enterprises of all sizes. Despite a current lack of consistency and clarity with regard to formats and implementation deadlines, some timelines are expected to be tight. Adopting the formats our two experts identified as most likely to prevail will simplify this challenge and enable software companies to make progress, while maximising eventual profit through minimising investment in unnecessary development.

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