Objectives and benefits of electronic invoicing in Colombia

Objectives and benefits of electronic invoicing in Colombia


Colombia is immersed in the expansion of electronic invoicing. The Directorate of Taxes and National Customs (DIAN) has been promoting its development since 2015 when it introduced legislative changes (Decree 2242 of 2015, Law 1819 of 2016 and Resolution 19 of 2016) to start the process of the widespread use of the new electronic invoicing model. DIAN’s plan contemplates a staggered calendar to which some of the taxpayers are adhering to mandatorily while others are adhering to it voluntarily depending on the volume of invoicing and certain characteristics (risk of tax evasion, VAT refund, etc.).

DIAN Resolution 000002 of 3 January 2019 states that, for now, only those that were classed large taxpayers on February 6, 2018 will be required to bill electronically, as well as those who over the last 6 years have been using e-invoicing in compliance with Decree 1929 of May 2007.

The Colombian government’s electronic invoicing objectives

  • Fiscal control. The Colombian government will try to reduce tax evasion by half using the electronic system. The electronic invoice is an essential tool to avoid tax leakage and to optimize the collection process. DIAN calculates that per year, the Colombian government stops paying 15 trillion dollars in VAT taxes, (22%) a figure that would increase 40% according to calculations by the International Monetary Fund.
  • Widespread use of the electronic invoice. Colombia follows the path of other Latin American countries such as Mexico, Chile and Brazil who are leaders in the development of electronic administration. Electronic invoicing is a key piece towards e-Government and paperless conditions. In this sense, for the country, the benefits of incorporating electronic invoicing translate into:
  1. Savings derived from eliminating paper and manual management as well as the reduction of errors due to automated processes.
  2. Environmental benefits due to the reduction of CO2 emissions, the reduction of paper consumption and transport energy costs.
  3. Agility in automated operating procedures.
  4. Increased security for procedures by implementing authentic mechanisms such as the electronic signature.
  5. The promoting of accounting and fiscal transparency.
  6. Foreign investment incentives and the country’s competitiveness thanks to fiscal control.

Benefits of electronic invoicing for business taxpayers

The implementation of electronic invoicing as a billing model entails numerous advantages for companies and ultimately savings. Therefore, the investment in technology required for incorporating this system will prove to be profitable.

  • Direct savings by eliminating paper, printing, invoice delivery and storage.
  • An increase in the administration department’s productivity. Thanks to the automation of this process, more time is available to complete other tasks.
  • Automation and integration in invoice receipt processes. The electronic origin of the document allows for the automatic integration in the system and therefore, its accounting, leaving invoices ready for payment practically without human intervention.
  • Greater efficiency and elimination of human errors as a result of automation and fully integrated usage. Electronic invoices can be automatically generated and transmitted from the provider to the recipient. Therefore, most of the economic benefits are not due to savings based on printed materials and shipping costs but they are due to the total automation and integration of the processes between business partners from the order to the payment.
  • Shorter delivery times and invoice collection. The efficiency of the issuance and reception processes, their immediacy and the practical elimination of errors in the generation and accounting processes contribute to reduce the invoice collection deadlines.
  • Greater security. Invoices are sent using private networks or specific protocols such as AS2, FTPS, WebServices, VAN (Value Added Network), etc. Furthermore, the digital signature systems guarantee the integrity, origin and authenticity of the invoices.
  • Agile, secure and legal storage. The original and signed documents are protected at a minimum by the time established by the current legislation. This reduces storage costs, and facilitates the consultation of old invoices.
  • Elimination of the risk of losing physical documents thanks to secure storage and the digital consultation of the invoices.

EDICOM is a technological provider authorized by DIAN for electronic invoicing

EDICOM is an authorizer provider for electronic invoicing in Colombia. To obtain such authorization from DIAN, EDICOM has exceeded all of the criteria established in article 12 of Decree 2242 of 2015:

  • It has a unique tax registry in force that is updated.
  • It’s responsible for sales tax and belongs to the common system.
  • It has the ISO 27001 accreditation on information security management systems.
  • The certification of the company’s financial status has been signed by a public accountant or fiscal auditor, as evidence of liquid validity exceeding 20,000 UVT (Tax Value Unit) and fixed assets over 10.000 UVT.

EDICOM guarantees compliance with the requirements established by DIAN to issue and electronic invoice, which are included in article 3 of Decrees 2242 of 2015:

  • To use the standard XML generated electronic format established by DIAN.
  • To use consecutive numbering authorized by DIAN.
  • To comply with the applicable requirements of article 617 and the specifications of 512-9 and 512-11 ET.
  • To include digital or electronic signatures that guarantee authenticity and integrity in accordance with the signature policy defined by DIAN.
  • To include the unique electronic invoice code.

EDICOM is an international leader in electronic invoicing and has developed e-invoicing solutions for sending and receiving electronic invoices adapted to the specifications of the countries of origin and the destinations to where its customers operate. The platform is integrated into the company’s ERP system or internal management system, which automates electronic invoicing processes while complying with legal requirements in any country in the world including Colombia. This adaptation involves the legal aspects that may affect the processes of signing, declaring and storing the invoices as well as the technical aspect related to document format or communication of protocols used.

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