The Colombian electronic invoice system

Issuing electronic invoices has become mandatory for all businesses in Columbia since 2019.

Generated invoices, debit, or credit notes are automatically submitted to the tax authorities for approval. This means the Colombian electronic invoice system is an example of a clearance model. Electronic documents must be issued in UBL 2.1 format. When we look at the technical details of the invoice, there are three important points; files include the company’s digital signature, an e-Invoice unique code (‘CUFE’), and QR code. 

Transmission of Electronic Invoices in Columbia

Electronic Invoices can be transmitted to tax authorities portal named DIAN (Dirección de Impuestos y Aduanas Nacionales)

in 3 ways:

1) Manually upload to DIAN

2) Sending electronic documents via DIAN-authorized e-Invoicing provider responsible of issuing, submitting and signing

3) Taxpayers developed and used their own ERP system via using the “Toolbox” (Package of documentation and examples of invoices) which was shared by DIAN.

As a last step, electronic documents must be stored for 10 years.

When issuing electronic invoices, two things should be considered; what is included in the invoice, and the price base. In UBL 2.1 there are 4 sections which include; description of goods or services, parties, details, and signatures. When it comes to price base two types are defined in Colombian regulations; fixed prices and variable prices (weight, area, quantity, time etc.). For variable prices, a reference price must also be established.

Reference price is defined as “the representative unit value of  goods or services whose price is stipulated in a way that does not allow the profit-making purpose of the supplier to be concealed”. For example, if a company provides a service which takes 10 hours to provide, and the price is set as USD$100, it will be difficult to determine the actual value of the service provided. In this case, a different reference price should be established. Also, for each type of good or service there is a code which must be used. Codes are defined in National  Industrial Standards Institute (INSInagro) document named “Classification of Goods and Services”.

Codes start from 4 digits and can have additional sub-codes (for example, 91131213 includes sub-codes 9113 and 1213). In case of fixed prices, reference price should be equal or greater than the price in market. In case of variable prices, reference price should be calculated using the formula specified in regulation. Colombian regulation states that e-In  voices should have the same security features as paper invoices, therefore Electronic Data Authentication (EDA) is required. This authentication can be achieved using digital signature, secure hash algorithm or by complying to another recognized standard for electronic authentication. It is important to note that an electronic invoice should contain the same information as a paper invoice. Other information that should be included in the electronic invoice are; contact information of the seller (registered name, address, telephone, email), buyer\’s corporative logo, CVD number or tax identity of the buyer, certificate of origin code (if any), shipment details (including shipment number), quantity, unit price, total price.

According to regulation, all official  documents must be sent in an open document format. The most commonly used formats are: .XLS, .XLSX, .ODS and .CSV. It is also recommended to protect such files using a password.

The regulation also states that the system used for transmitting invoices must verify that the invoice has been issued by authorized individuals (sellers). This can be done by using technology that verifies digital signatures, secure hash algorithm or other recognized standards for electronic authentication.

Currently only Microsoft has a solution to issue and accept e-Invoices in Colombia called B2B Connect.