Things to consider when selecting an e-invoicing solution
VAT Modernisation Recap: Where are we?
As news about SARS’s plans for VAT modernisation starts to settle, many businesses are asking the question, ‘What’s next?’. As stated in its discussion paper, SARS notes, “the future of VAT modernisation is to receive digitally transmitted VAT data.” In brief, this means businesses will need to look into selecting an e-invoicing solution for seamless information exchange. Although SARS is planning a phased implementation process over the next five years, we’re in what we like to call ‘the preparation phase,’ where you can do due diligence and ensure zero compliance curveballs are thrown your way.
The first step? Selecting an e-invoicing solution that ticks your boxes.
Why you need an e-invoicing solution
When it comes to VAT modernisation, it’s not just about sharing information; it’s about sharing the right information in real time. As with most things in the financial (and VAT) landscape, this isn’t as straightforward as it seems. To keep it brief, although the data lives in your business, it hides deep in your ERP system. Extracting said data and effectively interpreting it based on real-time insights is nearly impossible without software that knows where to look (and what to do once it’s found).
This brings us to the next point: How do you choose the right software?
How to choose the right e-invoicing solution
When evaluating the right e-invoicing solution, it’s important to remember that you will need to consider both your company’s unique goals and the relevant regulatory requirements.
Some core aspects to consider include the following:
- It’s not just about invoices
Consider your e-invoicing solution within the bigger AR landscape. Does it accommodate different document types, such as credit notes and purchase orders? This is an important consideration, as in order to facilitate real-time reporting of a business’s complete VAT liability, a business’s chosen e-invoicing software must be able to transmit all sales cycle transactions, not just invoices.
In addition, the right e-invoicing solution streamlines the overall AR process. Although e-invoicing is part of the package, the broader scope of AR automation software is specifically designed to eliminate time-consuming, manual tasks and the challenges (and bottlenecks) they perpetuate. Consider the required formats
Not all e-invoices are created equal, and neither are e-invoicing solutions. Be sure to take note of the e-invoicing formats serviced/provided and whether or not your chosen software has explicit plans to accommodate SARS’s chosen data format when this is announced.The existing South African footprint
Each country has its own set of regulations and nuances when it comes to VAT modernisation. This makes it imperative to choose a provider who is familiar with the current SA landscape, and who will prioritise offering solutions that are compliant with SARS’s specific requirements.- Integration capabilities
Can your preferred solution integrate seamlessly with your existing systems, or will it require a resource-intensive changeover? When selecting an e-invoicing solution, try to avoid one that requires core IT system or ERP changeovers as these can become very expensive, time-consuming, and difficult to adjust to.
Additionally, important questions to consider include:
- What is the solution’s user-friendliness, and does onboarding require any additional staff training?
- How long does it take to implement the solution/setup?
- Does the specific provider only offer e-invoicing for VAT compliance, or do they know how to leverage the power of e-invoicing to strengthen your key business processes?
- Are they transparent about your data and their pricing?
VAT modernisation – Next steps
Fortunately, choosing the right e-invoicing solution doesn’t have to drain additional resources. In fact, with us, you’re already one step ahead of the compliance curve and we’ll happily guide you along the way. For more detail on what to consider when deciding on e-invoicing solution, visit our e-invoicing solutions page. You can also reach out to us directly to find out more on our recommendations for trusted South African e-invoicing providers.
