Australia has adopted the Peppol framework as the common standard and network for e-Invoicing. Since July 2022, e-Invoicing has been mandatory for all B2G (business-to-government) transactions. This move is part of a broader strategy to enhance digital infrastructure and combat scams.
Australia and New Zealand Collaboration
Australia and New Zealand have jointly developed the “Australia and New Zealand Government Electronic Invoicing Arrangement.” This collaboration ensures a consistent approach to e-Invoicing across both countries, facilitating smoother cross-border transactions.
Government Investment
In May 2024, the Australian government allocated $23.3 million over four years to oversee and operate the secure e-Invoicing network. This investment underscores the government’s commitment to strengthening digital infrastructure and enhancing security measures.
B2B E-Invoicing
While B2G e-Invoicing is mandatory, B2B (business-to-business) e-Invoicing is still under discussion. The Australian government broadly encourages its adoption, recognizing the potential benefits in efficiency and fraud reduction. With over 1.2 billion invoices exchanged annually in Australia, the transition to e-Invoicing could significantly streamline business operations.
The Australian Peppol Authority
The Australian Taxation Office (ATO) serves as the Australian Peppol Authority. It defines the Peppol standards for GST (Goods and Services Tax) invoices and oversees the selection and approval of Peppol access points. The ATO collaborates with providers and businesses to ensure the framework meets diverse needs.
Currently, the standard used is PEPPOL BIS Billing 3.0. The ATO has accredited over 40 Peppol access points, ensuring robust and widespread access to the network.
How to Implement E-Invoicing in Australia
To engage in e-Invoicing, companies must register with the Peppol network. Businesses can utilize their existing e-Invoicing software, select a new service provider, or find an online solution. SPS Commerce, previously known as TIE Kinetix, is a trusted Peppol access point for both Australia and New Zealand.
An e-Invoice is akin to a paper invoice in that it must include the Australian Business Number (ABN), the date, and the total amount. The key difference lies in the transmission method, which, in this case, is through the secure Peppol network.
E-Invoices should be archived for five years, adhering to the same record-keeping rules as paper invoices. This includes protecting the records from unauthorized changes.
State and Territory Specificities
Since July 1st, 2022, the e-Invoicing mandate has applied to B2G transactions across Australia. Here are some state-specific updates:
- New South Wales: A pioneer in implementing e-Invoicing.
- South Australia: Predominantly receives e-Invoices, with fewer than 10 agencies not yet ready.
- Western Australia: Ran a pilot program in 2023 to be e-Invoicing ready by Q4 2023.
- Queensland: Transitioned to e-Invoicing during 2022/2023.
- Australian Capital Territory: Also transitioned to e-Invoicing in 2022/2023.
Australia’s adoption of the Peppol framework and the mandatory implementation of e-Invoicing for B2G transactions mark significant steps towards modernizing the country’s invoicing processes. With ongoing investments and collaborative efforts with New Zealand, Australia is poised to enhance its digital infrastructure and secure its invoicing network. Businesses are encouraged to prepare for these changes and leverage the benefits of e-Invoicing for improved efficiency and security.
