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Electronic Invoicing in Colombia: Legal Framework and Optimization with Athento

Learn how Athento transforms Electronic Invoicing in Colombia 🚀 We review technical requirements and functionalities to optimize invoice management #DigitalTransformation
Picture of Manuel Aguirre

Manuel Aguirre

The implementation of Electronic Invoicing in Colombia has marked a milestone in the management of commercial transactions. In a country with a dynamic and steadily growing economy, transitioning to electronic invoicing has been crucial to streamline and modernize accounting and business processes for companies. This shift not only responds to the demands of an increasingly globalized and digitalized market but also serves as a key measure to combat tax evasion and enhance transparency in commercial transactions.

In this regard, Electronic Invoicing in Colombia represents not just a change in how these financial documents are issued and received but also an opportunity to optimize business resources and improve operational efficiency. With electronic invoicing, Colombian companies can significantly reduce costs associated with printing, mailing, and storing physical documents, while streamlining billing and accounting processes.

However, implementing electronic invoicing in Colombia also presents unique challenges, particularly concerning compliance with legal and regulatory requirements established by Colombian tax authorities. In this context, Athento proposes a comprehensive solution to simplify and expedite the management of electronic invoices in Colombia. Athento provides Colombian businesses with the capability to meet legal and regulatory requirements while optimizing their accounting and business processes to adapt to a constantly evolving business environment.

Electronic invoicing in Colombia: background and regulatory framework

The history of electronic invoicing in Colombia dates back to 1995, when the Colombian government, through Law 233, granted electronic invoices the same legal validity as their paper counterparts, making the country a pioneer in Latin America. At that time, its use was mainly limited to the financial sector and some large corporations looking to streamline their administrative processes and reduce costs.

Subsequently, in 1996, the concept of “computer-generated invoice” emerged through Decree 1165. However, it wasn’t until 2007 that clear regulations were established for issuance, delivery, acceptance, and retention, through Decree 1929 and Resolution 14465. These regulations marked a turning point, transforming electronic invoicing into a voluntary option for businesses.

Despite its adoption, there were significant challenges such as the requirement for authorization from DIAN (Colombia’s tax authority) and customers to issue electronic invoices, and the lack of a defined standard. It wasn’t until 2014 when significant progress was made, backed by financial support from the Inter-American Development Bank (IDB) and the publication of Decree 2242 by DIAN, establishing conditions for issuance and interoperability.

The Pilot Plan for Electronic Invoicing in Colombia began in April 2016, involving 59 companies, which represented a significant step forward in implementing information technologies. Subsequently, in March 2019, DIAN’s Resolution 020 made electronic invoicing mandatory for all individuals or entities considered merchants.

Resolution 1092, issued in August 2022, introduced new changes allowing the use of POS invoices only for sales amounts below a certain value. These regulations aimed to facilitate tax control and ensure transparency in commercial transactions in Colombia.

Finally, with Resolution 165 of November 2023, the system of electronic Invoicing in Colombia was modified to adopt version 1.9 of the technical annex of electronic sales invoicing. It also introduced Annex 1.0 of the electronic equivalent document, replacing the cash register receipt with POS system. The objective has been to improve tax control, facilitate compliance with tax obligations, and promote the digital transformation of taxpayers.

Technical Requirements for Electronic Invoicing in Colombia:

Companies that issue and receive the Electronic Invoicing in Colombia must comply with a series of technical requirements to ensure the validity and integrity of the documents. These requirements include:

  • Digital Certificate: Taxpayers must have a digital certificate issued by a certification authority authorized by DIAN (Dirección de Impuestos y Aduanas Nacionales).
  • XML Standard: Electronic invoices must be structured according to the XML standard defined by DIAN, which specifies the format and information that must be included in each document.
  • Digital Signature: Electronic invoices must be digitally signed by the issuer using their digital certificate, ensuring the authenticity and integrity of the document.
  • Submission to DIAN: Issuers must submit copies of electronic invoices to DIAN through computer services enabled for this purpose.
  • Retention: Both issuers and recipients must retain electronic invoices and their respective XML files for the period of time established by current regulations.
  • Receipt and Validation: Recipients must be able to receive and validate the electronic invoices sent to them by the issuers. This involves having computer systems capable of processing and verifying the authenticity of the invoices received.
  • Integration with Accounting Systems: It is important for recipients to integrate the information from received electronic invoices into their accounting or business management systems. This facilitates the efficient recording and tracking of commercial transactions.
  • Compliance with Legal Requirements: Recipients must ensure compliance with all legal and regulatory requirements established by DIAN regarding the receipt and processing of electronic invoices in Colombia. This includes keeping systems and procedures updated according to current regulations.

Optimizing the management of electronic invoicing in Colombia with Athento

Most companies face similar challenges in issuing, receiving, and managing electronic invoices. Often, these processes are manual, which can lead to errors, delays, and inefficient information management. Manual issuance and management of electronic invoices can be slow and error-prone. Additionally, storing and tracking these invoices, even in digital format, can pose logistical and organizational challenges. Athento supports the resolution of these issues by offering alternatives to optimize these processes, providing tools for automation and efficient management of the invoice lifecycle. With Athento, companies can enhance the efficiency of their electronic invoicing processes and reduce errors and delays associated with manual methods.

Athento, a flexible and scalable platform for document management and process automation, offers innovative technological solutions to simplify the management of electronic Iinvoicing in Colombia. Through its suite of tools, Athento enables companies to streamline their accounting processes and optimize the management of financial documents. Some of the functionalities offered by Athento include:

Automated invoice capture

To optimize invoice reception, it’s crucial to establish clear and user-friendly channels to prevent document loss. Automated capture enables significant improvements in efficiency.

Athento enables the setup of digital channels such as a centralized email account for receiving invoices and automatically triggering workflows, as well as a web link for structured document uploads, ensuring all necessary information is received. Additionally, it allows customization of the web page with company branding and password protection. Athento also automates the request for specific documents via email, ensuring suppliers deliver all required documentation without manual intervention, uploading documents to their respective files and verifying completeness. Furthermore, Athento facilitates automated invoice capture from multiple sources such as SFTP, virtual channels, and electronic headquarters.

Automated invoice capture extracts relevant information without the need for manual data entry, reducing errors and saving time.

In the Colombian context, Athento offers a mailbox synchronization feature for receiving electronic invoices. Upon receiving an email with an attached .zip file, Athento automatically decompresses the file and displays the invoice’s binary PDF. It then reads the XML file and extracts required information into predefined fields configured according to specific needs. This automated operation allows invoice data to be captured without manual intervention, thereby streamlining the electronic invoicing management process.

Review and approval workflows

Athento allows configuring rules to route invoices through specific review processes based on amount or type of service. Users can preview documentation to verify accuracy and manage workflows internally. Without needing technical expertise, it’s possible to define the lifecycle of each case, ensuring documents digitally move between users for review and approval with full traceability. Athento also incorporates alerts to prevent document or invoice duplication, thus optimizing process efficiency.

The platform facilitates the creation of customized workflows for invoice review and approval, enabling efficient management of accounting processes.

Automated data extraction

Athento provides the capability to apply OCR (Optical Character Recognition) and other text extraction methods on documents, converting image content into text for various purposes:

The extracted information can be used as metadata or exported to ERP systems and other platforms.

Document generation

The platform allows for the automatic generation of documentation from predefined templates, facilitating the creation of reports and financial statements. Athento offers the capability to maintain a repository of corporate documentation templates, managing their approval and publication to ensure that certificates and other supplier documents are created with the necessary and updated clauses. These templates can be automatically used to generate documents via the REST API or on-demand from the user interface, integrating the information into core systems or ERPs.

composición de documentos con Athento

Integration with other tools

Athento integrates seamlessly with core accounting and business management systems, enabling smooth data synchronization across different platforms. Athento provides a framework to centralize invoice and supplier management, offering integration options such as an intuitive REST API that allows developers to connect external applications in a matter of hours.

This facilitates leveraging invoice data and exporting information to ERP systems. An interesting use case involves integrating Athento with BI tools to gain real-time visibility into the current status of invoices and make informed decisions accordingly. Additionally, Athento offers an SDK that enables technical users to create custom functionalities and tailor the user interface to meet specific needs. With this flexible and powerful solution, it’s possible to integrate data from various sources and maintain centralized supplier documentation, generating documents directly from the document manager and dynamically managing information.

Single supplier folder or file

Athento is a platform that enables the creation of a single file or folder for each supplier. This file stores all relevant information, regardless of its source (such as ERP systems or emails). Each file has a unique code to facilitate locating and automating tasks with documents. Additionally, Athento offers a flexible framework for developing customized solutions, such as web portals for suppliers to manage their invoices, certificates, and other documents. Retention policies can also be applied to notify suppliers about the validity of their documentation, saving time and improving user experience.

Implementing retention policies

Retention policies in Athento are essential for ensuring that documents are properly preserved according to legal and regulatory requirements. Here are more details:

  • Policy Definition: Athento allows you to establish specific rules for document retention. For instance, you can define how long certain types of records should be retained before deletion.
  • Legal Compliance: Retention policies ensure that the company complies with applicable laws and regulations. This is crucial for avoiding penalties or legal issues.

Electronic invoicing management in Colombia with Athento

Athento not only provides a comprehensive solution for electronic invoicing management but also adapts to the specific needs of the Colombian environment. Its capability to comply with local regulatory requirements such as digital signatures and secure storage makes it an ideal choice for Colombian companies looking to optimize their accounting management. With Athento, businesses can be confident that they are meeting regulations while improving their operational efficiency.

Electronic invoicing in Colombia is a business necessity that must adhere to specific regulations. Athento offers a complete solution to simplify and optimize electronic invoicing management. This enables Colombian companies to enhance operational efficiency and comply with legal requirements. If you’re seeking a solution for your accounting processes, Athento is your ideal partner.

Contact us today and discover how Athento can drive growth for your business!