E-invoicing: when your business must send electronic invoices

E-invoicing is no longer something only large enterprises need to worry about. The rules are expanding, and as a business owner in Denmark it is important to know when you are required to send electronic invoices and what that means in practice.

What is an e-invoice?

An e-invoice is an invoice that is sent and received in a structured, machine-readable format. It is not simply a PDF attached to an email. A true e-invoice follows a standardised format that the recipient's systems can import and process automatically, without any manual data entry.

In Denmark the primary formats are OIOUBL (Offentlig Information Online Universal Business Language) and PEPPOL BIS Billing 3.0. PEPPOL is the European network that connects senders and recipients across national borders, while OIOUBL is the Danish standard used mainly for transactions with the public sector.

Who is currently required to send e-invoices?

Transactions with the public sector

The most clearly defined obligation applies when you invoice public bodies. Since 2005 it has been a legal requirement in Denmark to send e-invoices to all public authorities, including central government, regions and municipalities. The rules are set out in the executive order on electronic settlement with public authorities.

This means that if your business supplies goods or services to a municipality, a government agency or a region, the invoice must be sent electronically in OIOUBL format via NemHandel or the PEPPOL network. A paper invoice or a PDF will generally not be accepted.

B2B transactions: EU requirements on the way

For invoicing between private businesses (B2B), the rules in Denmark have not yet been fully introduced, but the direction from the EU is clear. The EU directive on e-invoicing and the "VAT in the Digital Age" (ViDA) initiative point towards mandatory e-invoicing and real-time digital VAT reporting for B2B transactions.

Several EU member states, including Italy, France and Belgium, have already introduced mandatory B2B e-invoicing. Denmark is expected to follow within the coming years. Businesses that trade across borders within the EU should start preparing now.

What must your invoice contain?

Whether you are invoicing a public body or a private business, an e-invoice typically needs to include:

• A unique invoice number
• Issue date and due date
• The sender's and recipient's CVR number (and EAN number when invoicing public recipients)
• Description of goods or services
• Unit price, quantity and total amount
• VAT amount shown separately

For public sector invoices you must always include the recipient's EAN number (a 13-digit location number). Without the EAN number the invoice cannot be delivered correctly.

How to get started

This may sound technical, but in practice you do not need to learn XML or network protocols. Most accounting platforms, including e-conomic, Billy and Dinero, already support sending e-invoices directly from within the system. The process typically looks like this:

1. Register on NemHandel or connect to PEPPOL through your accounting software or a service provider.
2. Obtain the EAN number from the public authority you are invoicing.
3. Create the invoice in your system and select e-invoice as the delivery method.
4. Send it and save a copy of the sent invoice for your bookkeeping records.

If you trade with foreign companies that require PEPPOL invoicing, the process is the same, but you use the recipient's PEPPOL ID instead of an EAN number.

What happens if you do not comply?

When dealing with the public sector, your invoice may simply not be processed. This delays payment and can create friction in the working relationship. In the most serious cases, failure to comply could constitute a breach of contract.

As B2B rules are introduced, non-compliance will likely carry financial penalties or the loss of VAT deduction rights, as is already the case in other EU member states.

Frequently asked questions

Do I need to send e-invoices if I only invoice private customers? No. The e-invoicing obligation does not yet apply to sales to private individuals (B2C) in Denmark. You can continue invoicing as normal, but it is good practice to use a system that can scale when the rules change.

What is the difference between OIOUBL and PEPPOL? OIOUBL is the Danish format used primarily for public sector invoices in Denmark. PEPPOL is a European network and format used for cross-border invoicing and increasingly for domestic transactions as well. The two can be used side by side, and most systems support both.

Can I just send a PDF by email instead? To public bodies: no. A PDF is not an e-invoice within the meaning of the law and will typically be rejected. To private businesses it is still permitted, but be aware that the rules may change in line with EU requirements.

Let Legiant keep track of this for you

The e-invoicing rules evolve as new legislation is introduced by both the Danish Tax Authority and the EU. Keeping up can be difficult when you are running a busy business. Legiant automatically monitors the compliance requirements that apply to your business and notifies you when action is needed, so you can focus on your business rather than tracking legislation. Try Legiant for free