In September 2024, the Cabinet of Ministers (MK) reviewed the amendments to the Accounting Law, which provide for the establishment of regulations for issuing structured electronic invoices in Latvia. These updates introduce clear requirements for Latvian companies to adopt structured e-invoicing by 2026.
Here’s a breakdown of the relevant requirements and provisions introduced to regulate e-invoicing:
Scope:
E-invoicing requirements will apply to transactions with state entities (G2G, G2B, B2G) and those between companies registered in Latvia (B2B), including individuals performing economic activities under the Accounting Law and the Value Added Tax Law. Latvian-registered companies must issue structured e-invoices when billing other Latvian-registered companies for goods or services (Article 11, Paragraph 14 of the Latvian Accounting Law). B2C invoices are not within the scope of this mandate.
Submission of Data to the State Revenue Service (SRS):
Starting from January 1, 2026, it will be mandatory for companies to transfer e-invoice data to the State Revenue Service (SRS). The SRS will receive this data via the e-address of the unified portal of the Latvian state for e-invoice service providers and taxpayers.
The Cabinet of Ministers is responsible for defining the channels and procedures for e-invoice circulation. Companies must follow government-specified delivery channels for e-invoices (Article 11, Paragraph 15).
Technical Details of Structured E-Invoices:
File Format: Structured e-invoices must be formatted in XML.
Compliance Standards: The XML structure is defined by the Latvian national standard and must comply with the PEPPOL BIS Billing 3.0 specification (Core Invoice Usage Specification ( CIUS ) of PEPPOL BIS Billing 3.0 ) These invoices must conform to European standards, (e.g. EN 16931-1:2017) to facilitate automated electronic processing.
Submission Methods:
Companies can upload e-invoice files in XML format directly to the Electronic Declaration System (EDS) of the State Revenue Service (SRS). Alternatively, the e-invoice file can be transferred from accounting software to the SRS via an API, provided that integration with the e-invoice API of the SRS has been created for the accounting program.
Invoices will either be able to be submitted through a free national delivery solution, through PEPPOL services providers, or individually between taxpayers, if agreed between the two parties.
Implementation Timeline for E-Invoicing in Latvia
- January 1, 2025:
- E-invoices must be used in transactions between state administration and companies, covering G2G (government to government), B2G (business to government), and G2B (government to business) segments.
- Joint budgetary institutions and companies cooperating with budgetary institutions are required to issue justification documents as structured electronic invoices.
- By July 1, 2025:
- The Cabinet of Ministers is expected to issue regulations outlining procedures for e-invoice management and data submission. These regulations will take effect on January 1, 2026.
- January 1, 2026:
- E-invoices must be used in settlements between companies registered in Latvia, i.e. in the B2B (business to business) segment.
- The transfer of e-invoice data to the State Revenue Service will be mandatory.
Designed to promote efficiency and standardization through structured e-invoices for transactions between companies, the amendments mandate that companies follow the updated framework. Further details will be released on operational standards, submission protocols, and procedural guidelines will be outlined to ensure full compliance across sectors.
The Saeima (Latvian Parliament) passed the amendments on 31 October 2024 for the e-invoicing framework.
