What is an e-invoice?

In brief:

• An e-invoice is an invoice in a structured data format that is sent and processed electronically, reducing errors and saving time.
• In Latvia, it will be mandatory for B2G (business-to-government) transactions from 2025 and for all B2B (business-to-business) transactions from 2028.
• Implementing e-invoicing ensures faster payments, greater transparency, and the elimination of errors caused by manual data entry.
• It is essential for companies to choose a solution that provides standards-compliant integration, security, and automation capabilities.
  

An e-invoice, or electronic invoice, is a digital documentthat is prepared and sent in an electronic format. It allows for automatic processing by various resource management and accounting systems without the need for manual data entry. This is not only a more convenient and faster solution for accountants, but also a way to combat the shadow economy. Furthermore, it reduces errors and promotes sustainability.

The "Digital Portrait of a Manager 2025" study revealed that 18.4% of respondents have already implemented e-invoicing in their companies. Meanwhile, 20.1% indicated that they would like to fully digitize this area in the future. This is a relatively small percentage that will soon have to transition to an e-invoicing system quite rapidly, as it will be required by law.

E-invoicing legislation in Latvia

The issuance, transmission, and receipt of e-invoices will be mandatory for most Latvian companies, including individuals engaged in economic activity and other entities subject to the Accounting Law and the Value Added Tax Law. Starting January 1, 2025, e-invoices will be mandatory for transactions between businesses and public administration (including municipalities). From January 1, 2028, they will be mandatory for all companies registered in Latvia.

The Accounting Law stipulates that an invoice must be prepared as a structured electronic invoice and must comply with the Latvian national standard LVS EN 16931-1:2017 "Electronic invoicing – Part 1: Semantic data model of the core elements of an electronic invoice" and be issued by the company in accordance with the technical specification LVS CEN/TS 16931-2:2017 "Electronic invoicing – Part 2: List of syntaxes that comply with EN 16931-1".

This sounds complicated, which is also reflected in the "Digital Portrait of a Manager 2025" study, where understanding of the e-invoice format is at 53%. It is not a standard PDF, image, docx, or xlsx file. An e-invoice is a structured data format, such as XML, that contains all VAT and transaction data.

Why implement e-invoices?

E-invoices are not just about digitalization and time savings: they are a path to more transparent and secure invoice processing. In the long run, both parties—the state and businesses—benefit.

Benefits for the state

Reduced VAT gap and better tax compliance

E-invoices help reduce various forms of tax evasion because transaction data becomes structured and traceable. This decreases the opportunity to hide invoices, create fictitious input tax deductions, engage in duplicate transactions, and participate in fraud chains. Although this system is relatively new, countries that have implemented e-invoicing systems report a reduction in the VAT gap and improved compliance. (European Commission).

Reduced administrative burden for public institutions

E-invoicing reduces the workload for public institutions by eliminating the need for manual checks at every step, accelerating document workflows, providing a unified data format for all suppliers, and speeding up payment processes in the public sector. This facilitates the development of more efficient public administration systems.

A more transparent economy

E-invoice transaction data becomes analytically processable and comparable. Various software programs can quickly and easily scan this data to identify potential risks, make forecasts, and enable better budget planning.

Benefits for businesses

Less manual work and fewer errors

Manual data entry is eliminated, preventing errors and saving time that can be better spent on other tasks.

Improved cash flow and transparency

For businesses with high invoice volumes, this enables a faster, more predictable process that is less dependent on human availability. Electronically structured data allows companies to better control costs, automate approval workflows, analyze spending categories, and ensure auditability.

Less paper, less archiving, and lower costs

E-invoices eliminate the need for physical archive shelving and the manual transport of folders between departments, providing instant access to documents in digital archives. Furthermore, companies save on postage, printing, and manual data entry over time.

How to implement e-invoicing?

Although the legal requirements may seem long and complex at first glance, the process is actually relatively straightforward.

• Choose an e-invoicing solution based on the integrations available for your accounting software. In Latvia, e-invoice exchange is facilitated by e-invoice operators, such as Unifiedpost, Telema, Finbite, Jumis Envoice. Also, e-address is considered an e-invoice operator, as it is the channel through which e-invoices must be delivered to the public sector;
• Integrate the operator's platform with your accounting or ERP system;
• Develop internal guidelines: define deadlines, responsibilities, and the employees authorized to prepare and approve e-invoices;
• Start using e-invoices gradually—from a test group to full implementation.

What should you consider when choosing an e-invoice operator?

The market offers a wide range of solutions for e-invoicing processes. However, they are not all the same—each offers different features. Therefore, it is important that the chosen service provider meets all your requirements.

• Compliance with Latvian and EU requirements—the operator supports the e-invoice standard, has incorporated all Latvian regulatory requirements, and updates them regularly;
• Integration with accounting systems—the operator offers ready-made integrations with popular systems (Jumis, Horizon, Moneo, Standard Books, etc.) or an alternative solution via API; Full functionality—the ability to send e-invoices (including to an e-address), receive them, and attach files if necessary;
• Automation capabilities—the operator allows for the automation of invoice import/export, data validation before sending, and the creation of automated processes, such as: “e-invoice received → automatically entered into the system → sent for approval”;
• Security and data protection—the operator complies with GDPR, specifies where data is stored, uses secure communication channels (encryption, certificates), and undergoes audits and holds compliance certifications (e.g., ISO27001, etc.);
• Ease of use and support—an intuitive platform, support in Latvian/English, technical support, video tutorials, etc.;
• Pricing model—what makes up the total cost: implementation, subscription fees, transaction fees for sent/received invoices, and additional costs for integrations or other features;
• Additional features (optional)—electronic document archiving, transaction status tracking, mobile app, etc.

Future trends for e-invoicing in Latvia

Latvia is at a stage where some are already beginning to automate and digitize their processes, while others are still waiting. Consequently, we will only see the true picture of e-invoice adoption in 2027, when the statutory deadline is very close. This is also reflected in the “Digital Portrait of a Manager 2025” study, where only 12.1% consider this topic relevant. At the same time, 39% believe that the introduction of e-invoices will affect their business, and 28% are unsure if it will.

While 2028 may seem far away and there appears to be plenty of time to implement e-invoices, preparing in advance will make the process much smoother and allow for the correction of even the smallest errors. It will also be easier for clients to accept changes gradually rather than all at once on January 1st.

Implementing e-invoices is not just about sending an invoice—it is an opportunity to automate the entire invoice lifecycle (from order to payment, from supplier invoice to accounting entry). It will also facilitate the integration of AI into accounting processes, which will further reduce manual work and the likelihood of errors.

Don't wait until the last minute—set up your e-invoice solution today: Jumis Envoice!

Frequently Asked Questions

What is an e-invoice?

An e-invoice is a structured document prepared and transmitted in an electronic format. It enables the automatic processing of invoice data within accounting and resource management systems, reduces errors, saves time, and promotes transparent and sustainable invoicing.

When will e-invoices be implemented?

In Latvia, e-invoices have been mandatory for B2G (business-to-government) transactions since January 1, 2025. Starting January 1, 2028, they will be mandatory for all transactions between businesses registered in Latvia.

How should a company choose a suitable e-invoice operator?

When selecting an operator, it is important to ensure that it:

• Complies with Latvian and EU requirements (supports the Peppol UBL 2.1 BIS 3 invoice standard);
• Offers integration with your accounting or ERP system;
• Provides full functionality for sending, receiving, and processing invoices;
• Offers automation capabilities and secure data protection;
• Is user-friendly and provides reliable support;
• Aligns with your company's needs regarding pricing models and additional features.

How do you implement an e-invoice solution?

Implementing an e-invoice solution involves several steps:

• Select an e-invoice operator or solution;
• Integrate the operator's platform with your accounting or ERP system;
• Develop internal guidelines (responsibilities, deadlines, approval processes);
• Begin using e-invoices gradually, starting with a test group and moving toward full implementation.