E-invoices in Latvia

An e-invoice is a structured electronic document created and processed in a machine-readable format. One of the most commonly used e-invoice formats is XML (Extensible Markup Language). In this format, the content of the e-invoice is described in a way that allows IT systems to process it automatically. For non-IT specialists, this is best understood by analogy to a bank statement. A bank statement obtained via online banking is, in its form, the same as an e-invoice. It is also created in XML format, only a different standard is used to describe its content.

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Benefits

For business owners
For accountants

Reduced risk of errors

The recipient no longer needs to enter information manually, as the accounting system does this automatically, resulting in fewer rejected invoices.

Significant time savings at every stage, from dispatch to payment

Accounting software reads e-invoice data 100,000 times faster than the most efficient accountant.

Cost savings

Printing and mailing invoices is costly. Calculations show that sending e-invoices reduces expenses by 59%, while receiving and processing them reduces costs by 64%.

Improved cash flow

E-invoices can be delivered and processed much faster, and their payment can even be automated.

Social responsibility

Environmental impact is minimized by eliminating paper usage and reducing the need for physical transport.

Reduced risk of fraud

The electronic system automatically retrieves data from your business management software to verify that a transaction has occurred. You no longer need to spend time confirming that an invoice has reached the recipient, as the system automatically records data received from the bank upon payment. This provides immediate visibility into outstanding invoices and late payments.

More convenient payment control

As mentioned, paper documents often go missing or are submitted late, resulting in delayed payments. The faster and more convenient processing of e-invoices helps ensure payments are made on time and allows for timely analysis of accounts receivable.

More convenient debt analysis

By sending e-invoices, you can be confident that clients will process them more promptly and accurately. Since you receive feedback upon delivery, partners can no longer claim they did not receive an invoice to justify late payments.

Timeliness and reporting accuracy

Invoices and delivery notes sometimes arrive late or go missing entirely, leading to inaccuracies in financial and regulatory reports. E-invoices are delivered directly to the accounting department, ensuring they are processed and recorded on time.

Stress reduction

Accounting is a high-stress profession, often due to reporting deadlines, inaccuracies, and the need to communicate with the State Revenue Service to correct tax declarations. Timely receipt and accurate recording of e-invoices help reduce this stress.

Timely detection of errors or inaccuracies

An e-invoice is sent immediately upon preparation or on the same day, ensuring near-instant receipt and processing. This allows for quick verification of the information provided or prompt notification to the partner regarding any inaccuracies.

Reducing error risks and saving time

The recipient does not need to manually enter each invoice record; the accounting software does this automatically. Upon import, you only need to verify data that the system does not recognize, such as a new client not yet in the database or a new product. Automated processes reduce the risk of errors caused by oversight, typos, or other human factors.

Cost savings and social impact

Using e-invoices saves costs and natural resources, as there is no need to print documents.

Usage

How to send and receive e-invoices

E-invoices can be exchanged in several ways:

  • using email: the e-invoice is sent to the partner at the email address specified in the contract;
  • using an e-address: e-invoice exchange takes place via an official e-address account;
  • using dedicated data exchange channels that facilitate e-invoice processing.

When using email, remember to enable read receipts to ensure you receive confirmation that your business partner has received and viewed the invoice. The exchange process is accelerated if your accounting software supports automatic email delivery of e-invoices.

Using an e-address or other data exchange channels makes processing e-invoices in accounting software much more convenient, as documents are sent and received directly from program to program—there is no need to save the document to a storage device and then import it into the software.

How to implement e-invoices

The speed and ease of implementing e-invoices in a company depend on several factors.

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The e-invoice implementation process varies by company, but we suggest following these steps and adapting them to your specific needs.

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If your accounting system does not offer the ability to send and receive e-invoices, we recommend choosing the Jumis system or integrating e-invoicing into your current software using our developer code library.

Who can use it

Using e-invoices simplifies the work of both accounting and inventory staff. The time and resources saved by using e-invoices are significant.

When a warehouse receives an invoice with dozens of line items, manual entry takes at least 10 minutes, whereas automatic e-invoice processing takes less than a minute. Furthermore, and importantly, the risk of transcription errors is minimized.