E-Invoicing and the Future of Business Compliance in Denmark

by | Mar 20, 2024 | E-invoicing

Denmark has been at the forefront of advancements in e-invoicing since the introduction of business-to-government (B2G) e-invoicing in 2005. Recent legislative updates mark a significant moment, transforming not only B2G transactions but the entire business landscape.

Current Landscape

Denmark took a major step toward digitization in 2022 with the introduction of the Digital Bookkeeping Act, which mandates the use of digital accounting systems for business transactions. This demonstrates the government’s commitment to modernizing business practices and improving efficiency. There are also plans to gradually introduce a mandate for B2B e-invoicing, ensuring that the entire business ecosystem in Denmark embraces digitalization.

The Digital Bookkeeping Act

The Digital Accounting Act is a significant legislative development that will come into effect on July 1, 2024. This mandate requires companies to adopt digital accounting systems in order to streamline the recording of transactions and ensure compliance with reporting requirements. The Act aims to simplify accounting procedures, automate annual reporting processes, and increase transparency and accountability in business practices.

NemHandel and Peppol

The Danish e-invoicing infrastructure is built around the NemHandel platform, based off the Peppol model. This nationally developed and operated platform facilitates the secure exchange of electronic invoices between businesses and government agencies. NemHandel is mandatory for B2G public procurement and ensures compliance with the OIOUBL standard, which is in line with European norms. Those who are receiving e-invoices need to be registered with the Nemhandelregister. The Nemhandelregister is a Peppol SMP (Service Metadata Publisher) that is integrated with Peppol eDelivery and works as an address register. The purpose of integration is to improve cross-border connectivity in terms of receiving and processing eInvoices.

How to be compliant in Denmark

Businesses must register with Nemhandelregister (NHR) to receive e-invoices. Through NHR, businesses can obtain an e-invoice recipient number (GLN/EAN) which allows trading partners to look them up, and ensures compliance and a seamless transaction process.

There are several tools available for sending compliant eInvoices, including:

  • Integrating with cloud-based ERP/purchasing systems
  • Invoicing directly from financial systems
  • Using web-based platforms

Each method ensures compliance with Danish e-invoicing standards, paving the way for seamless transactions in the digital age.

Annual Digital Reports

Under the new rules, companies with a turnover of more than DKK 300,000 in the last two calendar years are required to submit an annual digital report to the Danish Business Authority (Erhvervsstyrelsen). This threshold will enable companies of different sizes to contribute to the digital agenda and promote a culture of transparency and compliance.

Embracing the Future

Denmark is moving towards a digital future and businesses need to adapt to new regulations. To stay compliant and innovative, companies should embrace eInvoicing and digital bookkeeping. Companies can seize opportunities for growth, increase operational agility, and foster greater stakeholder trust by going digital ahead of regulatory deadlines.

Maria Sanguino
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