E-Invoice: Guide for use in 2024-2025

The implementation of the E-Factura system in Romania is an important step in modernizing the invoicing process, with the main goal of reducing tax evasion and simplifying tax reporting for companies. Here is everything you need to know about the system.

1. What is E-Invoice?

E-Factura is an electronic invoicing system implemented in Romania to ensure the security and uniqueness of invoices issued by companies. This system eliminates the risks associated with the use of false or duplicate invoices and facilitates reporting between companies and tax authorities.

2. Timetable for the implementation of e-Invoice in Romania

EN e-Invoice for transactions with public institutions (B2G)

• Starting July 1, 2022, all companies conducting commercial activities with public institutions in Romania are required to issue electronic invoices through the RO e-Factura system. Tax documents issued to public authorities must be submitted exclusively in electronic format.

RO e-Factura for all B2B and B2G transactions

• Starting January 1, 2024, the obligation to use electronic invoicing was extended to all companies and taxable persons in Romania, regardless of whether they are registered for VAT purposes or not.

Obligation to transmit to recipients

• Starting July 1, 2024, all electronic invoices must be transmitted to recipients exclusively through the national RO e-Factura system.

Exceptions from the obligation to use E-Invoicing

Although the RO e-Factura system is mandatory for most transactions, there are certain important exceptions:

• VAT-exempt operations: It is not necessary to transmit electronic invoices for medical services, insurance, banking services, or other activities that fall outside the scope of VAT.
• Exports and intra-community supplies: Invoices issued for exports or intra-community supplies to recipients without a Romanian tax identification number are not mandatory in the RO e-Factura system.
• Fiscal receipts: Fiscal receipts issued by cash registers do not require transmission through the system. However, if an invoice is requested for a fiscal receipt, it must be submitted via the SPV using code 751 (“Invoice — information for accounting purposes”).
• Transactions with diplomatic missions: Supplies of goods and services to diplomatic missions, consular posts, or international organizations are exempt, but the system can be used optionally.
• Associations and foundations: Non-profit entities, such as associations or religious organizations, that are not registered for VAT purposes are not required to use the system until June 30, 2025. After this date, they must request registration in the RO e-Factura Registry if they carry out economic activities.
• Farmers under the special scheme: Individuals applying the special VAT scheme for farmers are not required to use the system until June 30, 2025, but they may opt in voluntarily. After this date, registration becomes mandatory if they begin to carry out economic activities.

For all exempt cases, it is recommended to access the SPV to download e-Invoices received from suppliers, as only these will be recognized in accounting starting July 1, 2024.

3.How does E-Invoicing work?

To use the E-Invoicing system, companies must follow these steps:

1. Registration in SPV (Virtual Private Space): The company must be registered in the SPV in order to use the system.
2. Adapted invoicing software: Most invoicing software is already integrated with the RO E-Invoicing system, allowing for quick generation of invoices in “.xml” format for validation and upload in the SPV.
3. Ministry of Finance’s online application: For companies that do not use dedicated software, the Ministry of Finance provides a free application for uploading invoices.
4. Guides for taxpayers: The Ministry of Finance and ANAF provide detailed resources for adopting the E-Invoicing system – GUIDE.

4.Transmission deadline

Invoices issued for the supply of goods and services with the place of delivery or performance in Romania must be transmitted in the RO e-Factura system within a maximum of 5 working days from the invoice issuance date, but no later than 5 working days from the deadline provided in the Fiscal Code (Article 319, paragraph 16).

5.Penalties for failing to meet deadlines

Failure to comply with the obligation to transmit invoices through the E-Invoicing system constitutes a contravention and is sanctioned as follows:

• Large taxpayers: Fine between 5,000 lei and 10,000 lei.
• Medium taxpayers: Fine between 2,500 lei and 5,000 lei.
• Other legal entities and individuals: Fine between 1,000 lei and 2,500 lei.

This system brings significant benefits for increasing fiscal transparency and simplifying the invoicing process, but it is important to comply with all legal obligations to avoid penalties.

6.Advantages of using E-Invoicing

The implementation of the E-Invoicing system brings numerous benefits for companies, especially in terms of efficiency and fiscal transparency. Among the most important advantages are: significantly reduced invoice processing time, elimination of the risk of lost or duplicated documents, quick access to the archive of sent and received invoices, and improved relations with tax authorities by complying with deadlines and the standard format required by legislation. Additionally, companies can more easily integrate their internal management systems with the SPV and benefit from the automation of repetitive accounting processes.

You can find more updates here as well.