New Zealand’s e-Invoicing journey started with the joint announcement of the governments of Australia and New Zealand on the adoption of the PEPPOL standard for the Trans-Tasman Electronic Invoicing Framework in February 2019. To enable more effective implementation of e-Invoices, PEPPOL authorities have been established in both countries. The Ministry of Business, Innovation, and Employment (MBIE) in New Zealand is overseeing the process. By digitizing the invoicing system, the New Zealand government aims to save $4.4 billion over ten years and intends for 90% of B2G transactions to be conducted through e-Invoices by July 2026.
1. Is e-Invoicing mandatory in New Zealand?
In New Zealand, businesses of all sizes can begin using e-Invoices. While small businesses are exempt from the requirement, large businesses and government organizations must begin receiving e-Invoices by March 31, 2022.
Small businesses can use e-Invoices voluntarily if they have PEPPOL-enabled accounting software, and if their supplier agrees to receive the invoice in electronic format.
2.What are the e-Invoicing requirements in New Zealand?
To use e-Invoicing in New Zealand, businesses must have a PEPPOL access point and a New Zealand Business Number (NZBN). The requirements are formalized with Australia under the Trans-Tasman Electronic Invoicing Arrangement of 25 October 2018.
When a business is registered, an NZBN is automatically assigned to it. If the business does not have one, it can always apply for an NZBN or look up existing numbers on the official New Zealand Network.
3.Will there be a digital signature for the invoices and what is the format?
There is no obligation to sign electronic invoices. The format used for invoices will be PEPPOL BIS Billing 3.0.
4.Will there be an archiving period for the invoices?
Yes, the electronic invoices will be archived for a period of 7 years.
5.What are the expected benefits for taxpayers of implementing e-Invoicing?
Since it involves less manual processing than paper invoicing, e-Invoicing makes business operations run more smoothly, quickly, and safely throughout New Zealand.
- Reduced processing costs can help businesses save a lot of money.
- In addition to reducing administrative delays and difficulties, e-Invoicing can improve trading relationships and reduce fraud risk.
- According to statistics, the cost of processing a paper invoice is over $30, compared with around $28 for a PDF invoice. Processing an electronic invoice costs less than $10. This cost effectiveness means that business owners can save more on operating costs and enjoy more effective sales management.