What you need to know about electronic invoices

At present, payers do not have a question about the need to work with electronic invoices – ESCF, from January 1, 2017 this obligation rests with both sellers regarding invoicing and buyers regarding legitimacy of accepting VAT deductions.

Are there any exceptions to the conditions of mandatory work with ESCF?

So, if you import goods into the territory of the Republic of Belarus under commission agreements, sell objects that are not taxed or are an individual entrepreneur who is not a VAT payer, in this case the ESCF is not created and accordingly it is not exposed to the payer and is not sent to the Portal, this procedure governs clause 7 of article 106-1 of the Tax Code (hereinafter – TC).

When selling objects of a foreign organization, selling goods to organizations that are not VAT payers, transferring objects free of charge (not subject to VAT), importing goods to the territory of the Republic of Belarus – ESCFs are created and sent only to the Portal. A detailed list is indicated in paragraph 8 of Article 106-1 of the Tax Code.

In other cases, the organization retains the obligation to create an invoice and (or) a referral to the buyer.

By what time is it necessary to set (forward) the ESCF?

The main period is the 10th day of the month following the month of shipment of goods. If the moment of actual implementation (hereinafter referred to as the “MFR” defined in Articles 92, 100 of the Tax Code) does not occur, then the invoice shall be sent (provided) within 2 business days from the date of the MFR. When exporting goods and reflecting export sales for sale in the declaration, the invoice is sent only to the Portal no later than the 10th day of the month following the reporting period. The deadline for sending the ESCF to the Portal for goods imported from countries – except for the countries of the EAEU, will also be the 10th day of the month following the month of release of goods, but not earlier than the declaration to the customs authority.

In case of importation of goods from the territory of the EAEU Member States, the deadline for invoice delivery is on the day of VAT payment, but not earlier than the application for importation and no later than the 20th day of the month following the month of registration of the goods.

The legislation establishes another period – the 5th day of the month following the reporting period. Organizations engaged in retail trade and catering, using the estimated tax rate, selling objects to individuals, as well as selling goods to customers who are not VAT payers in the Republic of Belarus no later than the 5th day, provide ESCF to the Portal.

I would like to note that the deadlines for the weekend are postponed to the next working day, and if it is impossible to send (provide) ESCF due to the inaccessibility of the Portal, invoices are sent within 5 business days from the day the Portal resumes work. The legislation establishes sanctions for non-directed (not provided) ESCFs, in the form of a fine in the amount of from two to thirty basic units – BV (Article 13.8 of the Code of Administrative Offenses – Code of Administrative Offenses).

An ESCF not issued by sellers automatically deprives the buyer of VAT deduction, in this regard, buyers can stipulate in the contract the conditions for the seller to issue invoices and, if the obligations are not fulfilled, pay a forfeit (fine, penalty), its amount, calculation procedure and conditions payment (paragraph 1 of Article 311 of the Civil Code of the Republic of Belarus).

Under the mandatory application of the ESCF, the “input” VAT is deducted on the basis of the invoice issued by the seller and signed by the buyer with an electronic digital signature (EDS). In this case, VAT deductible is taken depending on the timing of issuing and signing invoices in relation to the reporting period and the deadline for submitting a tax return. This means that subject to certain conditions, the invoice has not been received and signed, the calculated tax is not reduced by the amount of “input” VAT, and as a result will result in the payment of a larger amount of tax.

It should also be noted that the presence of a signed ESCF does not give the organization the right to accept VAT deductible without primary accounting documents (PUD), accounting records, the presence of a purchase book (if provided) and VAT paid (when importing goods).

Currently, tax inspectorates for each VAT return in an automated mode using the information system “Accounting of invoices” carry out off-site monitoring of ESCFs with the aim of correctly filling them, identifying arithmetic errors, as well as operational monitoring and preventing illegal schemes (including including relations with organizations entered in the register in accordance with Decree 488).

The result of accepting the “input” VAT deductible in violation of the established procedure will lead to an increase in the VAT payable and the application of sanctions in the form of a fine provided for in Article 13.6 of the Code of Administrative Offenses in the amount of 20% of the tax amount.

In conclusion, I would like to note that in the conditions of optimization of tax prov