Colombia Makes E-Invoicing Compulsory

Starting January 1, 2019, all those in Colombia responsible for declaring VAT and Impoconsumo (Consumer Goods Tax) will be required by the National Tax and Customs Directorate (DIAN) to use a new eInvoicing system.

According to news from an eInvoicing Platform, these changes come from a government mandate that’s part of the country’s latest tax reform. The new eInvoicing requirement is expected to reach more than 800,000 businesses throughout the country and could also reduce tax evasion rates, modernize tax compliance and increase savings for both the public and private sectors.

The National Tax and Customs Directorate is providing two eInvoicing options. The first is a free IT service from the tax body that enables you to create and download the invoices manually. This option is aimed at micro and small businesses lacking the capacity to implement advanced technology solutions.

The second option is to engage the services of a provider authorized by the DIAN, such as EDICOM, which allows you to automate the entire process of creating, validating and submitting electronic invoices following the regulatory requirements.

While 2019 is still far away — when the system becomes mandatory among taxpayers — the adoption of the new eInvoicing model will begin during the remainder of 2017 and 2018. The DIAN plans to have at least 50,000 Colombian companies billing electronically, with the first businesses selected, according to the government mandate “by a sectorial criterion according to the high risk of evasion identified therein and the least effort required for implementation.”

Once the DIAN notifies these taxpayers, which are assumed to be big businesses with technological capacity or relevant sectors in the tax area, the deadline to adapt to the new system will be three months. If the VAT and Impoconsumo (Consumer Goods Tax) eInvoicing requirement isn’t met, penalties will be issued.

Even those not required in Colombia can use eInvoicing voluntarily to enjoy the benefits of the system. To do so, they must first notify the DIAN of their interest in joining the eInvoicing system. They will then have three months to carry out the pertinent trials, and, if successful, they will have to start billing in the next three months.