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Executive Summary:
Latvia is implementing mandatory e-invoicing in a phased approach. B2G e-invoicing becomes mandatory on 1 January 2025, followed by B2B on 1 January 2026. Businesses must adhere to EU standards (LVS EN 16931-1:2017 and LVS CEN/TS 16931-2:2017) and are expected to use Peppol BIS format. B2B e-invoicing is coupled with a requirement to report e-invoice data to the State Revenue Service (SRS). While no specific infrastructure is mandated, businesses can use the government’s e-address platform. E-signatures are not required. This initiative is driven by the Ministry of Finance, supported by the Cabinet of Ministers, and awaits final approval from the Saeima.
Key Themes and Facts:
1. Implementation Timeline (Critical Dates):
- 1 January 2025: Mandatory B2G e-invoicing for resident companies invoicing listed state budget entities, and G2G and G2B invoices from budget entities. “Mandatory B2G e-invoicing takes effect on 1 January 2025. It applies to resident companies invoicing listed state budget entities, and G2G and G2B invoices from budget entities.” A transition period is in place until 1 January 2026 for B2G contracts signed before 31 December 2024. “Point nine in the amendment addresses a transition period until 1 January 2026 for submitting e-invoices for B2G contracts signed by 31 December 2024.”
- May 2025 (Expected): Announcement of specific rules for B2B e-invoices and reporting invoice data to the State Revenue Service (SRS). “Rules for B2B e-invoices and reporting invoice data to the SRS should be announced in May 2025.”
- 1 January 2026: Mandatory B2B e-invoicing commences, along with the obligatory submission of e-invoice data to the State Revenue Service (SRS). “Mandatory B2B e-invoicing takes effect on 1 January 2026. At the same time, businesses must also begin reporting e-invoice data to the State Revenue Service (SRS).”
2. Scope and Applicability:
- The regulations apply to all businesses falling under Article 3 (“Subjects of the Law”) of the Accounting Law. “As per the project description, all businesses under Article 3 (Subjects of the Law) from the Accounting Law are under the scope of these requirements.”
- B2C invoices are explicitly excluded from the scope of the mandate. “Additionally, the draft law foresees that regulations concerning e-invoice distribution channels will be developed and that B2C invoices are not within the scope of the mandate.”
3. Technical Standards and Formats:
- E-invoices must comply with the EU standards: LVS EN 16931-1:2017 and LVS CEN/TS 16931-2:2017. “Electronic invoices should comply with EU standards LVS EN 16931-1:2017 and LVS CEN/TS 16931-2:2017.”
- Peppol BIS is anticipated to be the mandatory format from 2025. “– 2025: Peppol BIS”
4. Data Reporting Requirements:
- From 1 January 2026, businesses are obliged to report e-invoice data to the State Revenue Service (SRS). “1 January 2026 – B2B e-invoicing and invoice data reporting to the State Revenue Service (SRS) become mandatory.”
- The adopted model is a decentralized CTC model, characterised as “Post Audit.”
- Rules for B2B e-invoices and reporting invoice data to the SRS are expected to be announced in May 2025.
5. Infrastructure and Access Options:
- No mandatory infrastructure is currently specified. “Mandatory Infrastructure: N/A”
- Resident businesses can manually upload single e-invoices through their e-address (e-adrese) on the government platform. “Resident businesses can manually upload single e-invoices through their e-address ( e-adrese ) on the government platform.” It’s anticipated that businesses will also be able to send e-invoices directly from their ERP systems to the e-address.
6. Other Key Requirements:
- E-signatures are not required. “eSignature: Not Required”
- The data archiving period for e-invoices related to goods and services is 5 years; for real estate, it’s 10 years. Archiving abroad is permissible under specified conditions. “– 5 years (goods and services) – 10 years (real-estate)”
- Regulations concerning e-invoice distribution channels are expected to be developed.
7. Key Players (Governmental Bodies & Stakeholders):
- Ministry of Finance (MoF): Proposed the amendments to the Accounting Law, driving the e-invoicing mandate. “The Latvian Ministry of Finance (MoF) has proposed amendments to the Accounting Law to introduce mandatory countrywide e-invoicing.”
- Cabinet of Ministers (MK): Supported the e-invoicing mandate after evaluation. “On 24 September, the Ministry of Finance (MoF) announced the Cabinet of Ministers’ (MK) support to mandate e-invoicing after their evaluation meeting…”
- Saeima: The Parliament of the Republic of Latvia; final approval of the draft law is required from this body. “The draft law is still subject to final approval by the Saeima (Parliament of the Republic of Latvia).”
- State Revenue Service (SRS): The tax authority responsible for receiving e-invoice data and administering the regulations. “1 January 2026 – B2B e-invoicing and invoice data reporting to the State Revenue Service (SRS) become mandatory.”
8. Current Status:
- The amendments to the Accounting Law were promulgated on 12 November 2024, solidifying the e-invoicing obligations. “On 12 November 2024, the amendments to the Accounting Law were promulgated, confirming the introduction of the electronic invoicing obligation in the country.”
Potential Implications for Businesses in Latvia:
- Potential Benefits: Greater efficiency, reduced operational costs, enhanced compliance, and streamlined processes.
- Potential Challenges: Initial investments in system upgrades, the need to adapt existing ERP systems, and potential technical complexities during the transition.
Recommended Next Steps for Businesses:
- Continuously monitor official announcements from the Latvian government regarding specific rules and guidelines, particularly those expected in May 2025, related to B2B e-invoicing and data reporting to the SRS.
- Conduct a comprehensive assessment of existing accounting and ERP systems to identify necessary modifications for compliance.
- Proactively explore partnerships with e-invoicing solution providers to ensure a smooth and efficient transition to the new requirements.
- Familiarise themselves with the e-address platform.
- See also
- Join the Linkedin Group on Global E-Invoicing/E-Reporting/SAF-T Developments, click HERE
