Electronic Invoicing System Obligation

This obligation has become a main aspect in the operations of the companies, since currently within the electronic system of documents that are transmitted to The National Tax and Customs Office -DIAN there are electronic invoices, electronic payroll payment support documents, electronic equivalent documents and their respective credit notes or adjustment notes.

Billing system

According to "article 1.6.1.4.4 The invoicing system is the set of functionalities that allow the interoperability and interaction of the electronic invoice, the equivalent documents and the electronic documents determined by the Special Administrative Unit of the National Tax and Customs Directorate -DIAN, and that may serve for the exercise of control by the tax and customs authority as support of the tax or customs declarations and/or support of the procedures carried out before this entity, as well as the other electronic instruments derived from these.

The billing system includes:

1. The sales invoice.
2. Equivalent documents.
3. The electronic documents that are determined by the Special Administrative Unit of the National Tax and Customs Directorate (DIAN), and that may serve for the exercise of control by the tax and customs authority, as support for tax or customs declarations and/or as support for the procedures that are carried out before this entity".

Due to its relevance, we share this informative bulletin where the most relevant considerations of the regulations regarding electronic invoicing are listed.

Electronic invoicing 

Legal regulations that apply to electronic invoicing in Colombia

About 3 years have passed since the beginning of the implementation of the electronic invoicing system, several provisions have been issued, including Decree 358 of 2020 and Resolution 000042 of 2020 (later modified by resolutions 000094 and 000099 of 2020, and Resolutions 000012, 000037, 000063 and 000167 of 2021, Law 2155 of 2021 created a series of amendments to Article 616-1 of the Tax Statute -ET- components of electronic invoicing and equivalent documents.

Subsequently, Resolution 000085 of 2022, Unified Concept No. 0106 of 2022, and Unified Concept No. 0106 of 2022 were issued. The National Tax and Customs Directorate - DIAN collected the current tax regulations on electronic invoicing and revoked all the provisions in the concepts and official notices issued previously and finally Decree 442 of 2023 was issued on March 29, 2023.

Obliged to Invoice Electronically

The following are obliged to invoice electronically: legal entities, those liable for VAT and National Consumption Tax, individuals exceeding gross income of 3500 UVT ($133,014,000 year 2022, $148,442,000 year 2023), typographers and lithographers who are not liable for VAT, in accordance with the indications set forth in paragraph 3 of article 437 of the ET and taxpayers registered in the simple taxation regime RST.                 

Parties not obliged to issue electronic invoices

The issuance of an invoice shall not be required for transactions carried out by the following parties:

a) Banks.

b) Financial corporations.

c) Savings and housing corporations, commercial financing companies.

d) Companies constituted as legal or natural persons that provide urban or metropolitan public passenger transportation services.

e) Natural persons linked by an employment or legal and regulatory relationship and pensioners, in relation to the income derived from these activities.

f) Individuals who only sell excluded goods or provide services not taxed with VAT, whose income is less than 3,500 UVT.

g) Service providers from abroad.

Electronic computer services

Currently there are several options to choose the electronic invoicing software, in our experience this step is relevant to carry out the process, since it will depend on the type of business, volume and technology that each company has, the options are as follows:

DIAN Free Service: To use the "DIAN Free Invoicing" service, only a device with internet access is required. However, for this option it is important to be aware of the intermittencies and instabilities that this system presents.

In-house development: to generate electronic invoices, it is possible to implement in-house software, however, technical knowledge of systems, development and programming is required.

However, technical knowledge of systems, development and programming is required; for this purpose, the DIAN has a "Toolbox" (documentation package and examples of invoices). It is important to consider that this option may be a bit more time consuming and costly for the company. It will depend on the needs that the company wants to cover with this development. 

Technology Provider: The taxpayer may hire the services of a Technology Provider authorized by the DIAN. Through this provider, companies may transmit electronic invoicing in accordance with legal guidelines.

Prerequisites for electronic invoicing

In order to start the process of electronic invoicing, obligated parties must consider the following aspects:

I. To have an updated RUT, both company and of the legal representatives, and to have access to the e-mails registered in the RUT.

II. To have the electronic signature instrument.

III. Install a digital signature certificate, which may be obtained from the entities authorized by ONAC. For those billers who have chosen the Dian's free software, such certificate may be requested free of charge.

Requirements of the sales invoice and equivalent documents

For tax purposes, the issuance of an invoice referred to in Article 615 consists of delivering the original invoice, with the following requirements in accordance with Article 617 of the Tax Statute:

a) Be expressly denominated as a sales invoice.

b) Surname and name or company name and NIT of the seller or of the person rendering the service.

c) Surname and name or company name and NIT of the purchaser of the goods or services, together with the discrimination of the VAT paid. (Section c, modified by Art. 64 of Law 788 of 2002).

d) Bear a number corresponding to a consecutive numbering system of sales invoices.

e) Date of issue.

f) Specific or generic description of the items sold or services rendered.

g) Total value of the operation.

h) Name or company name and NIT of the invoice printer.

i) Indication of the status of withholder of the sales tax.

At the time of issuance of the invoice, the requirements of paragraphs a), b), d) and h) must be previously printed by lithographic, typographic or similar industrial techniques. When the taxpayer uses an invoicing system by computer or cash register machines, with the printing made by such means the requirements of previous printing are understood to be fulfilled. The invoicing system must number the invoices consecutively and the necessary means for their verification and audit must be provided. 

Language and currency in the content of sales invoicing systems

The party obliged to invoice must generate the respective electronic sales invoice in its entirety in Spanish and official currency Colombian peso. The above without prejudice to the possibility of expressing the electronic sales invoice in other complementary languages or currencies.

Penalties for non-compliance with electronic invoicing

According to the provisions of the Tax Statute, the subjects obliged to invoice electronically that do not comply with the electronic invoicing requirements may face sanctions such as the closing of the establishment for 3 days, or a pecuniary sanction of 1% of the value of the operations invoiced without complying with such legal requirements according to article 617. E.T, not exceeding the equivalent of 950 UVT ($40,291,000 in 2023).

[1] unified concept no. 0106 of august 19, 2022 obligation to invoice and electronic invoicing system

[2] Decree 442 OF 2023.

[3] Resolution 000085 of 2022.

[4] Concept 911428 - int - 106 of August 19, 2022. DIAN

[5] Concept 100192467- 1963 of 2023 - DIAN