Solutions for mandate e-invoicing and Making Tax Digital


The challenge 

As you may be well aware by now, as from 1 January 2019, e-invoicing becomes mandatory for transactions carried out between taxpayers resident or established for VAT purposes in Italy. This means that as from this date, your IT solution needs to exchange e-invoices in a specified XML format, bidirectionally through the government run Interchange System (so-called “SDI”). Any invoices that are not issued in the required XML format and are not transmitted via the SDI platform will be considered as not issued, meaning that deduction of input VAT will BE denied and penalties can be imposed.

These new requirements are very challenging for most companies and require a review of the end-to-end invoicing process. ERP and other software providers are trying to keep up with changes and offer one or more of the localized solution components for their clients. Unfortunately, time is running out and the announced grace period only offers a little bit of extra breathing space for companies that still need to make changes to comply with the new requirements. This demonstrates once again that tax in the digital world requires connectivity and integration and it is widely expected that more and similar requirements are to come into place in the near future in other countries as well.

Solutions and how PwC can help

The solution for your business and IT landscape will depend on a large number of variables and there is no one-size fits all.  PwC continues to assist clients and helps to bring clarity in available ERP and intermediary solutions as well as the PwC in-house developed solutions. With new implementations coming up on the horizon, an agile approach is needed that allows you to deal with different stakeholders in the process, achieve business and IT alignment and finally get the solution that is sustainable to support you digital tax requirements going forward.

Below, you can find a high-level (non-exhaustive) overview of the services which we are able to assist you with:

  • support on make or buy decision (direct connection to SDI or connection via an intermediary);
  • vendor selection assistance (insourcing vs. outsourcing) of an ERP, intermediary invoicing or digital procurement solution;
  • support with establishing a direct connection to SDI and automation of the invoicing processes;
  • tax compliance audit/review of the implemented solution.

More updates on new and upcoming requirements such as the Making Tax Digital (MTD) initiative in the UK  and other mandatory e-invoicing implementations will be covered in our next newsflashes.