eInvoicing Documentation
eInvoicing in Malta
Legislation
In Malta, the eInvoicing Directive has been transposed via Legal Notices 403 and 404 of 2018. This Directive was transposed under the Financial Administration and Audit Act and also under the Local Councils Act. This was warranted since Local Councils in Malta have separate financial regulations that are listed in a dedicated act for these local authorities. Moreover, the extra year for sub-central entities applied. There is rather a fragmented picture at the sub-central level for accounting reporting since most entities and local councils use different accounting systems or packages.
The Maltese government promotes the adoption of eInvoicing in its Digital Malta national strategy entitled: Digital Malta 2014-2020. The central government's action to promote the adoption of eInvoicing is an encouragement for local actors' implementation of eInvoicing.
The introduction of eInvoicing was also reflected within “Mapping Tomorrow”, the strategic plan for the digital transformation of the public administration for 2019-2021.
Furthermore, as part of the activities of the eInvoicing4Islands project, Malta committed to deploy a new eInvoicing service for Government and its sub-central authorities taking into account the on-going development for central authorities and the required connection to the eDelivery Building Block.
eInvoicing platform and eInvoicing management solutions
Currently, there is no eInvoicing platform in place. The Treasury Department, together with the support of the Malta Information Technology Agency (MITA) is currently in the implementation process phase of a Corporate Financial Management Solution (CFMS), which will also incorporate the processing of eInvoices across the central government. Economic operators will be able to submit eInvoices to contracting authorities through their eInvoice solution and service providers. The Maltese Government is still in the process of selecting its Peppol certified eInvoice service providers.
Approach for receiving and processing eInvoices
Since Malta will adopt the Peppol BIS Billing 3.0, it will be able to receive eInvoices via the Peppol eDelivery network. Moreover, a suppliers' portal will be made available and suppliers could input their invoice details and send to the relative Ministry, Department, Entity or Local Council. This portal is warranted since most suppliers still do not have their systems ready to automatically generate an eInvoice.
The benefits of electronic invoicing are maximised when the generation, sending, transmission, reception and processing of an invoice can be fully automated. Widespread adoption of electronic invoicing within the EU is expected to lead to significant economic benefits. The move from paper to (fully automated) eInvoices allows public entities buying goods or services to reduce business costs and contribute to the modernisation of domestic payment infrastructure[1]. This is achieved by:
- Automated validation and importation of information into payment and accounting systems, which results in faster and more cost-effective processing, eliminating the need for manual data entry.
- Efficient control over cash flow, which is essential for businesses to maintain operations.
- Reducing delivery and print costs, and removing the need for paper archives, envelopes, paper, and stamps, lowering material costs and environmental impact.
- Removing manual data entry and reducing data errors,significantly reducing the time spent on balancing accounts and searching for discrepancies.
- Increasing the transparency of the entire Procure-to-Pay (P2P) cycle, enabling businesses to have a clearer view of the entire process.
- Offering suppliers access to all eInvoice status information, which significantly reduces the time spent on managing supplier inquiries.
No electronic signature is required for eInvoices and the archiving period amounts to 6 years[2].
eInvoicing implementation in sub-central level contracting authorities
The eInvoicing model is a Peppol-based strategy, but it is still in the implementation phase. Any eInvoices (incl. non-domestic suppliers) will be exchanged via the Peppol eDelivery network. Malta made used of the additional year provided for by the Directive, to ensure its implementation at sub-central authorities’ level. The main reason for this is because there is a fragmented picture at the sub-central level for accounting reporting. The eInvoicing legislation made eInvoicing mandatory only for amounts above the EU procurement thresholds.
There are communication channels to raise awareness about the upcoming mandatory eInvoicing implementation at the sub-central level. More specifically, there is a dedicated contact person in each Ministry and the National Forum on eInvoicing.
The expected benefits of eInvoicing are the cost and operational savings and the reduction of administrative burden. Since sub-central entities have different ERP/Accounting packages, not all will be immediately able to adopt an automated approach.
Status on the implementation of the European Standard on eInvoicing (EN)
The eInvoicing committee composed of government stakeholders in Malta agreed to adopt the Peppol BIS Billing 3.0 and its Core Invoice Usage Specification (CIUS). To be able to do this Malta has become an end-user member with OpenPeppol.
Both central government and sub-central authorities will be able to receive eInvoices via the Peppol eDelivery network or via a suppliers' portal. In sub-central authorities consists of various solutions in the different entities. Therefore, existing solutions can remain in use. In this context, contracting authorities and entities (as defined in the eInvoicing Directive) will be expected to arrange access to or establish an eInvoicing capability that supports receiving and processing of European Standard eInvoices via the Peppol eDelivery network.
Monitoring eInvoicing implementation
There is no monitoring system in Malta to track the use of eInvoices.
Use of Core Invoicing Usage Specifications (CIUS) at national level
Malta is a Peppol member, and therefore the Peppol CIUS will be used at the national level. There is no ad-hoc or national CIUS in use or foreseen in Malta.
Digital reporting requirements
In Malta, eInvoicing is not currently used for Valuad Added Tax (VAT) digital reporting. Therefore, there is no obligation for VAT taxable persons to periodically or continuously submit data in a digital way on their transactions[3].
[1] (Maltese Ministry for Finance – eInvoicing FAQs, 2023), [2] (Compliance updates – Malta, 2023), [3] (VAT in the Digital Age Report Digital Reporting Requirements, 2022)
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