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Compliance and Regulations

Tax incentive for electronic invoicing in Belgium

January 15, 2024
9:00 am

The Belgian government has introduced a draft law aimed at amending the country’s VAT Code.

The bill officially establishes the introduction of a business-to-business (B2B) electronic invoicing mandate by January 2026. The aim of this bill and the introduction of a B2B mandate is to digitalise, automate and speed up data exchange between companies and the Federal Public Service Finance.

An innovative aspect that aims to encourage businesses to support the bill is the introduction of a tax incentive. This incentive represents the first acknowledgment of the possibility to offset implementation, subscription, and consultancy costs related to electronic invoicing for businesses.

The introduction of Belgium’s tax incentive

Beginning on the 1st of January 2025, electronic invoicing digital investments will be eligible for a tax deduction of 120%. This deduction applies to billing packages utilising structured electronic formats that facilitate electronic invoicing (e-invoicing).

Additionally, this measure includes consultancy costs associated with implementing the obligations outlined in the law. The tax deduction will be effective from the taxable period 2024 to 2027.

Belgium's tax incentive is not the first incentive we have seen from governments and tax authorities looking to mandate electronic invoicing regulations. Singapore’s government introduced a similar approach to promote e-invoicing in 2022. Take a look at our Singapore blog for further details.

While electronic invoicing creates many advantages for both businesses and governments, some businesses may perceive e-invoicing regulations more as a compliance requirement than a beneficial practice. By introducing incentives, governments are helping businesses realise the e-invoicing benefits much quicker.

Understanding the benefits for Belgian businesses and the government

There are some concrete benefits for companies exchanging e-invoices with their business partners; faster payments, lower printing and postage costs, cheaper and faster invoice processing, lower retention costs, just to name a few.

According to research conducted by the Belgian Office of Administrative Simplification, opting for e-invoicing could result in savings exceeding €3.6 billion for Belgian companies.

Furthermore, e-invoices enable quicker scrutiny by the tax authorities, serving as a tool to combat VAT fraud and address the issue of the so-called VAT gap.

The proposed legislation distinctly underscores the significance of interoperability in terms of content (semantic), format (syntax), and transfer (technology). Consequently, the government suggests adopting the European Peppol standard in Belgium.

How to maximise on the government’s incentive

Transitioning from manual, paper-based invoicing tasks, to efficient electronic processes can seem daunting at first. Working with the right e-invoicing provider is key to ensure a smooth and seamless transition.

The right e-invoicing provider will guide you through the process and help you realise the benefits and value-added-services that electronic invoicing creates.

Unifiedpost Group is a leading global e-invoicing provider. We work with businesses of all sizes and help them quickly see the benefits of electronic invoicing. By adopting our solution, businesses in Belgium, and other countries around the world, can connect to local government platforms to ensure they are complying with local regulations.

To start your transition to efficient electronic invoicing processes, contact a member of our local Belgian team who will guide you through your journey.

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