Speaking on the ATO’s tax professionals webcast, ATO director Mark Stockwell said e-Invoicing would usher in a number of benefits, including faster payment times, time savings, and less mistakes from manual intervention.
“Some of the early trials at the moment are indicating that there are great benefits in getting quicker and faster payment times back from the payer,” said Mr Stockwell.
“We’ve already heard of people saying we will pay you in 20 days if you do it through the e-Invoicing system. We think that through market pressure as this comes about and the masses join the initiative, then we will see the time frame get smaller and smaller
“There’s about $26 billion worth of unpaid invoices floating around at any point in time so if we can speed that up from a 60, 90, 120 day pay cycle at the moment to a few days, it is going to make a massive difference to the Australian economy.”
Earlier this year, research from Deloitte Access Economics said e-Invoicing could result in economy-wide benefits of up to $28 billion over 10 years.
Mr Stockwell also explained that e-Invoicing was more than an emailed PDF invoice.
“It is not about sending a PDF through the email system anymore. What it will bring about here is the end of scanning, PDFs, posting, collecting, data entry, all those traditional ways that have involved administration when you’re dealing with an invoice,” said Mr Stockwell.
“You will be able to send from one software package through to another one whether or not it is the same company, the technical standard behind the system enables all software to talk to each other.”
Last month, Treasury released a discussion paper consulting on the e-Invoicing governance arrangements between the Australian and New Zealand governments, as both governments ramp up their commitment to create a seamless trans-Tasman business environment.
Institute of Certified Bookkeepers executive chair Matthew Addison believes that with the government already supporting the use of e-Invoicing, accountants and bookkeepers should start preparing for a “total move” to a digitised business process.
Likewise, ATO assistant commissioner, Colin Walker believes e-Invoicing is a joining together of the dots as the industry moves into a total digital environment.
“We’ve moved into a world where practitioner lodgment service is the way that agents now lodge, we have BAS agents in a digital world as well and they were there before we moved to PLS so that was the foundation and from there we’ve moved towards single touch payroll, and when you get to e-Invoicing, you’re now linking the business to other businesses and you can see the opportunities,” said Mr Walker.
“The more we move into software and software based products, we are going to have a total digital environment that will have all the information – that makes life a lot easier for the agent but it also means you can focus on the analytics.”
Jotham Lian is the news editor of Accountants Daily, the leading source of breaking news, analysis and insight for Australian accounting professionals.
Before joining the team in 2017, Jotham wrote for a range of national mastheads including the Sydney Morning Herald, and Channel NewsAsia.