Send Invoice in Denmark

Denmark has long been a frontrunner in digitalizing its invoicing processes, particularly within the public sector. Mandatory electronic invoicing for business-to-government (B2G) transactions was introduced in 2005, making Denmark one of the first European countries to implement such a requirement. This pioneering move aimed to streamline public procurement and enhance efficiency. Suppliers providing goods or services to public authorities must submit invoices electronically, as paper invoices are not accepted.

The legal framework for invoicing public authorities requires adherence to specific structured formats, primarily Peppol BIS Billing 3.0 and OIOUBL 2.1, both of which comply with the European e-invoicing standard (EN 16931). The national digital infrastructure, NemHandel, was established to support this requirement, and it is interconnected with the broader Peppol network, allowing for flexible submission methods.

More recently, the Digital Bookkeeping Act, adopted in 2022, has significantly broadened the scope of digital requirements. While there is currently no mandatory business-to-business (B2B) e-invoicing requirement, the Act mandates that businesses use certified digital bookkeeping systems capable of generating and receiving structured electronic invoices. This legislation is being implemented in phases, with most businesses, including small companies with an annual turnover exceeding DKK 300,000 for two consecutive years, expected to comply by January 2026 (or July 2026 for those using in-house accounting systems). The Danish Business Authority (Erhvervsstyrelsen or ERST) is the responsible body for these policies and the certification of bookkeeping systems. This evolution signifies a shift towards a "readiness-based" e-invoicing jurisdiction, where the emphasis is on system capability rather than a strict transaction-by-transaction mandate for B2B.

The NemHandel system serves as Denmark's national digital infrastructure for the secure exchange of electronic business documents, including e-invoices, particularly for transactions with public authorities. NemHandel operates on a four-corner model, similar to the Peppol network, which facilitates electronic trade across Europe. Its primary benefit is enabling the secure and efficient sending and receiving of electronic invoices, eliminating the need for paper-based processes for B2G transactions.

• Sign up on the NemHandel platform: This involves connecting your accounting system to an access point.
• Ensure recipient registration: Verify that the recipient is registered in the NemHandel Registry (NHR) and obtain their e-invoice recipient number, often a GLN/EAN number.
• Choose your submission method: Options include fully integrated e-invoice-enabled ERP solutions, ERP solutions combined with open-source software from the Danish Business Authority, or a self-service web-based invoicing portal.
• Select an Access Point Provider: This provider ensures your invoice meets mandatory standards and delivers it to the recipient's access point.
• Transmission: The invoice is then sent through your access point provider to the recipient's access point.

A common challenge can be ensuring all recipient details, especially the correct GLN/EAN number, are accurate, as errors can lead to rejected invoices and delayed payments. It's crucial to regularly verify recipient information within the NemHandel Registry. Another tip is to leverage the interconnectedness of NemHandel with the Peppol network; if your business already uses Peppol for international transactions, you can often use the same access point to reach Danish public entities, simplifying your workflow.

In Denmark, adhering to specific formats and standards is crucial for electronic invoices, especially when dealing with public authorities. The two primary structured formats accepted are OIOUBL 2.1 and Peppol BIS Billing 3.0. Both formats are compliant with the European e-invoicing standard (EN 16931), ensuring interoperability across EU systems.

OIOUBL (Offentlig Information Online - Universal Business Language) is Denmark's national XML-based invoice format, built upon the UBL 2.0 standard. It has been the long-standing national standard for B2G transactions. Peppol BIS Billing 3.0, on the other hand, is a widely adopted European standard that offers broader international compatibility. While OIOUBL 2.1 has been a staple, the increasing adoption of Peppol BIS 3.0 reflects a move towards greater harmonization with European e-invoicing practices.

For identifying recipients, GLN (Global Location Number) or EAN (European Article Number) numbers are essential. These unique identification numbers are used by public authorities to ensure invoices are routed correctly through the NemHandel or Peppol networks. Businesses must obtain the correct GLN/EAN number from their public sector clients to ensure successful invoice delivery.

When to use each format often depends on the recipient and your existing infrastructure. If you primarily deal with Danish public sector entities and have systems configured for it, OIOUBL 2.1 remains a valid option. However, for businesses engaged in cross-border trade or those looking for a more future-proof and internationally recognized standard, adopting Peppol BIS Billing 3.0 offers significant advantages due to its widespread use across Europe. The Danish Business Authority has even reviewed the national OIOUBL format against the growing adoption of Peppol, indicating a strategic lean towards the latter for broader compatibility.

The Peppol network plays a pivotal role in facilitating cross-border electronic invoicing for businesses operating in Denmark, extending capabilities beyond national borders. While NemHandel is Denmark's national e-invoicing platform, it is interconnected with the Peppol network, meaning suppliers can transmit invoices via Peppol access points to Danish public authorities. This integration is crucial for businesses engaged in international trade, as Peppol provides a standardized and secure framework for exchanging electronic documents across different countries.

• Streamline cross-border transactions: Peppol eliminates the complexities of differing national e-invoicing standards, allowing businesses to use a single connection to reach trading partners across the globe.
• Improve interoperability: As an open network model, Peppol ensures that electronic documents can be exchanged seamlessly between various accounting and ERP systems, regardless of their location.
• Enhance efficiency and reduce errors: Standardized formats like Peppol BIS Billing 3.0 reduce manual data entry and the associated risks of errors, leading to faster processing and fewer disputes.
• Future-proof operations: With the increasing global adoption of Peppol and initiatives like "VAT in the Digital Age" (ViDA) in the EU, using Peppol positions businesses to adapt to evolving digital reporting requirements.

The Danish Business Authority acts as the Danish Peppol Authority, further solidifying Peppol's standing within the country's e-invoicing ecosystem. This means that businesses adopting Peppol are not only meeting Danish requirements but also aligning with a broader international standard, offering a competitive edge in the global marketplace.

While business-to-government (B2G) e-invoicing has been mandatory in Denmark since 2005, the landscape for business-to-business (B2B) electronic invoicing is experiencing significant shifts, driven by the Digital Bookkeeping Act of 2022. Although there isn't a strict mandate for B2B e-invoice issuance yet, the Act requires businesses to be capable of generating and receiving structured electronic invoices. This "readiness-based" approach is fostering an increasing adoption of B2B e-invoicing.

The advantages of structured UBL (Universal Business Language) e-invoices, such as Peppol BIS 3.0, are becoming increasingly apparent in the B2B sector. These include:

• Enhanced automation: Structured formats allow for automated processing, reducing manual effort and speeding up invoice handling.
• Improved data quality: Standardized data reduces errors and discrepancies, leading to more accurate financial records.
• Cost savings: Automation and reduced manual intervention translate into lower operational costs for businesses.
• Better audit trails: Digital, structured invoices provide clear and easily auditable records, aiding compliance.

Emerging trends suggest that while a full B2B e-invoicing mandate is not yet in place, it is anticipated to become compulsory for B2B transactions by 2027 or 2028. The Digital Bookkeeping Act's phased implementation, requiring all businesses to use certified digital bookkeeping systems by January 2026 (or July 2026 for in-house systems), is a crucial step in this direction. This indicates a clear market shift towards greater digitalization, where the ability to handle structured electronic invoices will become a standard expectation for all businesses, regardless of their trading partners. The continued expansion of the Peppol network within Denmark also positions it as a key infrastructure for future B2B e-invoicing developments.