How To Use eInvoicing For Your Business

eInvoicing is a new system introduced by the Australian Government, and businesses will soon be required to adopt this streamlined approach.

Here’s what you need to know…

What is eInvoicing?

eInvoicing is a new Australian Government initiative where businesses can digitally exchange invoices between other businesses, using the Peppol framework. This can include suppliers, contractors and the government.

It allows businesses to send and receive invoices digitally, eliminating the need for PDF formats and traditional delivery methods.

When using the Peppol framework for eInvoicing, your invoices will automatically appear in your software, ready to be paid.

The Australia Government has nominated the Australian Taxation Office (ATO) as the authority for the Peppol framework to ensure it is implemented successfully. However, the ATO cannot see your information or invoices.

Note: You can receive eInvoices from any business no matter what software they’re using, as long as they’re engaging the Peppol framework in Australia.

eInvoicing is NOT mandatory yet, but we will keep you updated if anything changes.

What are the benefits?

• eInvoicing reduces manual handling of your invoices and also increases automation (so you have more time for other business activities!).
• Provides a secure and safe way to handle invoicing for your business.
• Improves business cash flow as it reduces wait times for late payments – if both parties are using the Peppol e-invoicing framework, then the Government states that invoices must be paid within five days.
• Saves you money. Gone are the days of printing out paper invoices!

Which entities can be registered for eInvoices?

• Private companies.
• Discretionary trusts.
• Fixed trusts.
• Fixed unit trusts.
• Hybrid trusts.
• Family partnerships.
• Cooperatives.
• Individual/sole traders.
• Limited partnerships.
• Local government entities.
• Other incorporated entities.
• Other partnerships, trust strata-titles and unincorporated entities.

Source: Xero

How to set up eInvoicing?

Through your existing accounting software.

Xero

1. Add your business’s Australian Business Number (ABN) to your organisation settings in Xero.
2. Make sure you have the right person as advisor or standard user role in Xero. They will have access to register or deregister your company for eInvoicing.
3. Choose a business contact in Xero.
4. Purchase a Xero subscription (if you haven’t already) – you cannot register for eInvoicing without it!

Next, you can register to recieve the invoices by:

1. In the Business menu, click Bills to pay.
2. Click Automate bill entry, then click Register to receive eInvoices.
3. Enter your business’s ABN, then click Search for business information.
4. Verify your business information, then click Yes, these details are correct.
5. Enter details for the business contact. Select the checkbox to agree to the terms and conditions.
6. Click Complete registration.

Your business is now registered and will appear on the Peppol network directories page. You will now receive eInvoices.

For more on receiving eInvoices through Xero, click here.

Source: Xero

Myob

1. In MYOB, click the settings menu and choose Sales settings.
2. Click the eInvoicing tab.
3. Read the displayed information, or watch the video, about eInvoicing. When you’re ready, click Get started.
4. Enter your business details such as ABN, business name, state and postcode.
5. Agree to the terms and conditions.
6. Click Register for eInvoicing.
7. Once you’ve completed your registration, you’ll see this indicated in your MYOB sales settings (business name > Sales settings > eInvoicing tab).

For more on eInvoicing with Myob, click here.

Source: Myob

How to deregister:

To deregister from Xero eInvoicing:

1. In the Business menu, click Bills to pay.
2. Click Automate bill entry, then click Manage.
3. Click Deregister from receiving eInvoices, then click Deregister.

Source: Xero

To deregister from Myob, contact their support team.

If you’re currently using a mix of digital and manual methods to invoice other businesses, consider migrating the process to your digital accounting software.

If your accounting software can’t currently eInvoice, consider connecting your software to an add-on e-invoicing product, or purchasing accounting software that can e-invoice.

eInvoicing should NOT come at an extra cost for businesses, unless you don’t already engage an accounting software like Xero or Myob.

What happens if you still create invoices manually?

If you still send out invoices using paper of Microsoft Office software, you will need to:

1. Check the list of eInvoicing providers.
2. Purchase the software.

Source: Business.gov.au

Stricter compliance for business owners.

Implementing eInvoicing means stricter compliance rules from the ATO. Business owners will no longer have the luxury of overlooking record-keeping, as the use of e-invoicing will create a more transparent system, holding businesses accountable.

As eInvoicing soon becomes the standard, it will become very obvious when individuals claim deductions they aren’t entitled to. This transition serves as a reminder for all businesses that proper invoicing and record keeping practices are a necessity.

Keep up with any changes to eInvoicing for businesses below.

If you want to make the transition to eInvoicing, please speak with your Aintree Group advisor to make sure it is the right decision for your business. We can set you up with your Xero file and help with the whole process.

This is general advice only and has not been prepared with your situation and needs in mind. For individual and personalised advice, we highly recommend that you seek out proper professional advice from your accountant.