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HMRC internal manual

VAT Traders’ Records Manual

HM Revenue & Customs
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Computer invoicing: Introduction

This chapter provides a brief overview only. You can obtain detailed guidance from the Audit Service intranet site and in VAT Control notes.

Electronic invoicing is the transmission and storage of invoices, without the delivery of paper documents, by electronic means. Electronic equipment is used for the processing (including digital compression) and storage of data.

‘Electronic equipment’ employs, for example:

  • wires;
  • radio transmission;
  • optical technologies; or
  • other electromagnetic means.

In its simplest terms this is simply where a company uses invoices in an electronic format rather than a traditional paper method. There are additional considerations in electronic invoicing but for the most part the invoicing legislation is common to both paper and electronic methods. It is becoming increasingly common and so will be encountered more frequently. The method of transmission is an area of changing technology that needs to remain in line with the legal requirements.

Whilst many types of commercial documents associated with the “supply chain” (for example, orders, and delivery notes) are now exchanged electronically, it is the invoice that is of particular interest to the department, due to its function as a prime VAT accounting document. Clearly, then, our approach to electronic invoicing requires a balance to be struck between the needs of businesses and our needs of maintaining ongoing effective revenue assurance.