Invoice definition: A digital document that proves transactions for the sale of goods and services. This document has components and characteristics. It is prepared and signed electronically, and sent and received through the electronic billing system with the knowledge of the financier. It is also reviewed and verified in real time by the Tax Authority.
The electronic billing system has many advantages. The first of these characteristics is the presence of a unique number for each invoice, this is called the UUID and is different from the company’s internal invoice number. The second of these characteristics is the presence of a unified form and content for each invoice within the system, with an emphasis that the form of the invoice will not change within the company.
The ERP sends the data specified by the IRS to the electronic invoice system and the API transfers the invoice data in JSON or XML format without transferring the invoice format. The system also allows for unified coding of goods and services, and invoices include an electronic signature, which ensures complete security of billing data and proves legal authenticity for users of the system. The system sends instant notifications to both the seller and the buyer for their sharing of billing data. It is also possible – using the system – to save, review and print the invoice data.
The system provides the option of linking it to any of the ERP systems. This integration is achieved using a set of application programming interfaces (APIs) provided by the company implementing the technical solution. The IRS also provides an integration platform and SDK interfaces,
It is worth noting here that the Tax Authority is still working on linking the electronic invoice system with the electronic declaration, and it is expected that this integration will be available in the next stages of the system.
The electronic invoice system allows the issuance of invoices in both Arabic and English, and also allows you to exchange invoices, discount notices, and addition notices with other parties and companies.
The system reserves the right for its users to amend invoices by issuing discount or adding notices to the invoice, or canceling the invoice completely and issuing another invoice, provided that this occurs within the legally specified time for cancellation.
In the event of an error in a previously issued invoice, it shall be modified by issuing discount notices or addition notices related to previous invoices.
It is also possible to issue notices related to a group of invoices instead of a single invoice, bearing in mind that the total amounts of the discount notices do not exceed the amount of the previously issued invoice.
The system also enables its users to issue a credit note on the condition that the amount of the credit note does not exceed the amount of the invoice associated with it.
But if you want to cancel an invoice after it has been issued, the system allows the seller to cancel the electronic invoice within a period specified by law. In this case, the seller must request the cancellation of the invoice on the system that sends the buyer a notice of cancellation.
After receiving a notice to the buyer of the cancellation, he can refuse or agree to cancel the document. The case is a valid document on the system.
The electronic invoice system requires the buyer’s tax number – for transactions above a certain limit specified by law – to issue the invoice, and in the case of dealing with customers who are not tax registered, the buyer’s national number must be used instead of the tax number.
One of the characteristics of the electronic billing system is the creation of a digital file for the financiers in order to deal with the authority, and this digital file is linked to the financier’s data registered with the authority; For example tax registration number, company name, main address.
Each company has authorized authorized delegates, one of which is the Enterprise Resource Planning (ERP) system, which is approved in a secure way to exchange documents with the department. In addition, each issued invoice is electronically signed, and the electronic signature represents a legal representation of the company in all its dealings.
Goods imported from outside the Arab Republic of Egypt are not included in the electronic invoice system because the source of the invoice is from outside the Arab Republic of Egypt, but in the case of reselling those goods to persons or companies inside the Republic, they are subject to the electronic invoice system as a transaction.
Egypt is the first country in the Middle East to implement the electronic invoice system, which is based on the establishment of a central electronic system to receive, review, approve and follow up sales and purchase invoices for commercial transactions between companies through the instant exchange of invoice data in a digital format without relying on paper transactions to limit the tax community.