E-Invoicing Compliance in Spain: Avoid Fines and Streamline Your Process

While implementing mandatory B2B electronic invoicing in Spain seems to be taking longer than planned, B2G e-invoicing has been compulsory since 2014. The mandate took effect when Law 25/2013 was enacted, imposing an obligation to issue electronic invoices for transactions between organizations and the state public sector.

Electronic invoicing was introduced in Spain on 30 November 2012 and was optional, requiring consent from the recipient. In 2022, Law 18/2022, referred to as “Ley Crea y Crece,” outlining the requirements for B2B e-invoicing was established.

Spain has already sent the mandate’s technical regulations in a Draft Order to the European Commission for review and amendment suggestions. The EC and Spanish Tax Agency have been working on amendments, after which the one-year Royal Decree will be published.

After this decree, e-invoicing will become mandatory, giving it an estimated date of early 2026. Businesses can prepare for the incoming mandate, which only applies to domestic B2B transactions.

In this post, we’ll discuss Spain's e-invoicing process and mandate timeline to help you remain compliant and streamline your processes. We’ll look at the requirements and penalties for non-compliance and provide tips on ensuring compliance.

Is e-invoicing mandatory in Spain?

E-invoicing has been mandatory in Spain since 2015 for transactions with public legal entities above EUR 5,000. Spain is working to make B2B e-invoicing mandatory, but the planned launch date, 1 July 2025, will be missed.

The mandate is estimated to come into effect in early 2026 after the 12-month Royal Decree. The draft Royal Decree is still under review by the European Commission. It mandates an advanced e-invoicing process for B2B transactions that complies with EU Regulation No. 910/2014.

The B2B e-invoicing mandate will first target businesses with an annual turnover of more than EUR 8 million. Two years after the publication of the Royal decree, firms with an annual turnover less than or equal to EUR 8 million will also be required to adhere to the set regulations.

Timeline for upcoming e-invoicing mandate in Spain

The upcoming invoicing mandate has yet to take effect as the Spanish Tax Authority (AEAT) continues to work on the draft Royal Decree with the European Commission. Spain submitted the draft to the EC in 2023, but the review is not over, and several amendments have already been made.

Important dates to keep in mind:

May 2024: Due to repeated delays in the launch date of the mandatory e-invoicing Royal Decree, the likely estimated date is early 2026. The date was set at 1 July 2024 but was delayed due to a public consultation.
July 2024: The AEAT submitted the most recent draft on 26 July 2024, and the EC has until 4 October 2024 to issue any comments. This draft Ministerial Order (Sp. Orden Ministerial) focused on the content and technical specifications for Computerized Billing Systems (SIFs). It also specifies the requirements for Verifactu, a real-time invoice reporting system (RTIR) that business owners can use instead of generating and preserving duly Registered Invoices.

What are the requirements for e-invoicing in Spain?

The draft Royal Decree outlines users' requirements to issue compliant electronic invoices in Spain. These include:

E-invoicing solution

The most recent Royal Decree draft issued to the European Commission by the Spanish government outlines a real-time invoice reporting system (RTIR), Verifactu.

The public electronic invoicing solution will be managed by tax authorities, but business owners will have the option of using a private system. However, for electronic invoices issued outside Verifactu, you must generate and preserve duly maintained Invoice Registers.

Transactional requirements

For every transaction, taxpayers must hold the following defined data set requirements:

A unique digital hash identifier
Digital stamp for the transaction process
Digital market showing the invoicing system or ERP that generated the electronic invoice
A QR code that the customer can use to verify the invoice’s compliance

These transactional e-invoicing requirements are mainly intended to help curb tax evasion and data manipulation. The tax authorities use businesses' billing records to conduct financial audits.

Archiving

During a B2G transaction, the issuer must archive the e-invoice for a minimum of 5 years. The archiving requirement for B2B transactions outlined in the draft Royal Decree is six years but is yet to be confirmed.

Electronic signature

The Spanish Tax Authority recently introduced the mandatory use of an electronic signature for B2G transactions. For e-invoices issued to public bodies, the issuer must use an XAdES electronic signature.

The requirements outlined in the draft Royal Decree for B2B transactions mandate that business owners must include an advanced electronic signature that adheres to the eIDAS Regulation on electronic ID and trust services.

However, this has yet to be confirmed in the published document that businesses are eagerly waiting for.

Required format for e-invoicing in Spain

The required format for B2G transactions is Facturae, the XML-based national standard that requires an electronic signature adhering to the XAdES standard.

B2B electronic invoices must adhere to the EN 16931 standard with the following options acceptable:

UBL Invoice and Credit note messages that comply with ISO/IEC 19845:2015
EDIFACT Invoices that adhere to ISO 9735
XML invoices according to XML Schemas 16B (SCRD-CII)
Facturae format

How e-invoicing works in Spain

Let us discuss how e-invoicing in Spain works for B2B and B2G transactions:

How e-invoicing works in B2G in Spain

B2G electronic invoices are issued through the PGEFe (Punto General de Entrada de Facturas Electronicas) or public institutions' General Entry Point for Electronic Invoices.

Here is a detailed process for issuing an electronic invoice in Spain for a B2G transaction:

Step 1: Generate and issue an electronic invoice

The first step is to extract the invoice data from the ERP system and convert it into the XML Schema as outlined by the Tax Authorities. The issuer must then apply various data validation mechanisms to ensure that all required details are included.

Step 2: Apply a digital signature

The law requires you to apply an electronic signature to provide the authenticity and integrity of the electronic invoice. Issuers must use advanced electronic signatures based on XAdES.

Step 3: Send e-invoices to the PGEFe

Once the invoice is ready and meets all the requirements, send it to the PGEFe (Punto General de Entrada de Facturas Electronicas) or the General Entry Point of Electronic Invoices enabled by the public administration you transact with.

Step 4: Archive electronic invoices

After completing the transaction, the issuer must archive the electronic invoice in XML—Facturae format. They must also ensure consistent accessibility and high-security conditions.

How e-invoicing works in B2B in Spain

Spain is still preparing to implement mandatory electronic invoicing for transactions, which is estimated to launch in 2026. The draft Royal Decree states the standards business owners are supposed to meet during accounting and invoicing to help prevent fraudulent activities.

Businesses will be allowed to use the public system or integrate third-party companies that offer electronic invoicing services into their accounting and invoicing software. E-invoices must comply with the EN 16931 standard and will be acceptable in various formats, including Facturae, UBL, and more.

Here is a detailed step-by-step guide on how to issue and receive electronic invoices for B2B transactions:

Step 1: Invoice generation

The first step is to extract invoice data from your ERP or accounting and invoicing software to generate a compliant document. The acceptable formats include XML CII, EDIFACT, Facturae, and UBL.

Ensuring compliance by adhering to the set regulations can be challenging for businesses without the knowledge or capabilities to integrate mandatory e-invoicing into their operations for business growth. Business owners must also include an advanced electronic signature for verification and validation.

In such cases, businesses can use a third-party service provider like Storecove to help ensure that the simplified invoices generated adhere to the set regulations. You can integrate your invoicing system with Storecove for easy issuance and compliance.

Step 2: Issuance

After generating a compliant document, you must send it to the Tax Authorities through Verifactu. To issue the electronic invoice to the recipient, you can use various communication channels, including the DEI gateway, https, sftp, x400, AS2, AS4, OFTP, or private VAN.

Step 3: Electronic storage

However, if you fail to use Verifactu, you must ensure traceability with accessible records. The current draft Royal Decree outlines safekeeping invoices under an eIDAS Electronic Storage service.

Spanish Tax Authorities rely on these records and electronic signatures on invoices during tax audits. The draft Royal Decree currently sets the minimum archiving at six years but may be subject to change.

What are the penalties for not complying with e-invoicing in Spain?

The Spanish state tax administration agency is intent on ensuring businesses comply with the e-invoicing mandates. Non-compliance is an administrative offence that may result in a warning or a fine of up to EUR 10,000.

The sanctions are regulated by Art. 19 of Law 6/2020 of 11 November 2020, which regulates various aspects of electronic fiduciary services. The amount a business is fined is staggered and based on various criteria.

How can businesses comply with the e-invoicing mandate in Spain?

The e-invoicing mandate will take effect in the near future, and businesses should prepare to meet the requirements and regulations. They will also enjoy benefits such as eliminating paper invoices, payment efficiency, and enhanced compliance.

Here are ways companies in Spain can comply with the upcoming e-invoicing mandate:

Overcome integration challenges

To generate invoices in the required formats, your ERP or accounting and invoicing software should meet specific requirements to overcome integration challenges. It should also be able to create and add advanced electronic signatures to the documents.

Some of the integration challenges businesses encounter include difficulty when handling data migration, alignment of electronic invoicing workflows, involving e-invoicing specialists, and effective project management.

Your organization must allocate adequate resources to adopt mandatory e-invoicing and may also need to hire electronic invoicing professionals to help it fully understand the mandates.

Partner with reliable third-party service providers

While generating and issuing invoices yourself sounds like a cheaper and more viable option, it may pose some challenges that may result in non-compliance and, eventually, hefty fines.

Business owners can take the time to understand the e-invoicing mandates and ensure their system can process electronic invoices. However, this may require an initial investment in software, training, and time to understand the invoicing process.

Partnering with an e-invoicing service provider can help you navigate the upcoming mandates more smoothly. A reliable company such as Storecove can help you ensure compliant invoices that adhere to the Spanish Tax Authority regulations.

The invoicing service provider will ensure that your process is seamless, helping you focus on more productive tasks.

Takeaway: Prepare for the upcoming B2B e-invoicing mandates in Spain to avoid fines and streamline your business process

Spain’s mandatory B2B e-invoicing system is estimated to come into effect in early 2026. However, the implementation process has faced several delays due to public consultations and other challenges.

Spanish companies should prepare for mandatory invoicing, as non-compliance may result in fines of up to EUR 10,000. This digital transformation will require invoices to have an electronic signature for traceability and authenticity.

The Spanish Tax Authority suggested the Verifactu systemas the invoice repository to help ensure invoice authenticity. Business owners can also use a private system or incorporate a third-party e-invoicing service provider for seamless electronic data interchange and to ensure compliance.

At Storecove, we help businesses comply with the outlined e-invoicing regulations and standards. If you’re looking to be among the best-prepared organizations for the e-invoicing mandates in Spain, contact us today!

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