Digital Accounting & E-invoicing in Latvia 2026 — Where We Stand

2026 will go down in Latvian accounting history as the year the paper invoice era officially began its end. Until now, the e-invoice was a choice — a convenient alternative for those who wanted to work in a modern way. From 1 January 2026, it has become a legal obligation for anyone issuing an invoice to a public authority. And this is just the beginning — the next step, mandatory B2B e-invoicing, is already scheduled for 2028.

However, as often happens with digital reforms, there is a gap between the text of the law and day-to-day reality. Many businesses are only just getting to know the PEPPOL network, adapting accounting software takes time, and many questions remain about how the process will work in practice. In this article, we take a look at where we actually stand in mid-2026.

Current Status — What Is Mandatory and What Isn't Yet

Latvia's e-invoicing rollout is happening in stages to give businesses time to adapt.

What is mandatory from 1 January 2026:

• All suppliers providing goods or services to budget institutions (B2G — Business-to-Government) must issue a structured electronic invoice.

• This obligation applies to all public procurement contracts and agreements with the state sector.

• The e-invoice must comply with the PEPPOL BIS Billing 3.0 standard and be in a structured XML format — a simple PDF, even if e-signed, is no longer valid.

What is not yet mandatory:

• Business-to-business (B2B) transactions — mandatory e-invoicing in this segment has been postponed to 1 January 2028.

• However, a voluntary B2B e-invoicing phase started on 30 March 2026, encouraging businesses to start switching to electronic invoice exchange now.

This phased approach makes sense — it allows the public sector to become an "anchor client" that motivates businesses to invest in e-invoice infrastructure before it becomes mandatory across the whole market.

E-invoicing for Government Contracts — What Every Supplier Must Know

If your SIA has ever issued an invoice to a ministry, municipality, school, hospital, or any other budget institution, in 2026 you may no longer do so in paper format or as a simple PDF.

Requirements for a B2G e-invoice:

1. Structured XML format in accordance with the EN 16931 standard and the PEPPOL BIS Billing 3.0 specification.

2. Automatic processing — the recipient's system must be able to read it without human intervention.

3. Transmission via the PEPPOL network — not by email.

4. Mandatory data — supplier and recipient PEPPOL identifiers, invoice number, date, amount, VAT information, procurement contract reference (where applicable).

What happens if you don't comply?

If a non-compliant invoice (e.g. paper or PDF) is submitted to a public authority, the authority is entitled to reject it. This means payment for goods or services provided may be delayed until a correct e-invoice is prepared and submitted.

The PEPPOL Network — What It Is and How It Works

PEPPOL (Pan-European Public Procurement Online) is an international e-procurement and e-invoicing network connecting businesses with public authorities across Europe. Its aim is to standardise the exchange of electronic documents so that a business can send an invoice to any European public authority using a single system.

How PEPPOL works:

1. Your company creates an e-invoice in its accounting software or on a dedicated e-invoicing platform.

2. The invoice is converted into PEPPOL BIS format and sent through your PEPPOL Access Point.

3. The Access Point forwards the invoice to the recipient's (e.g. a ministry's) Access Point.

4. The recipient's system automatically imports the invoice, validates it, and sends an acknowledgement.

Advantages:

• One connection, all of Europe. You do not need to register separately in each country's system.

• Reduced errors. Automatic validation eliminates manual data entry mistakes.

• Faster payment. Structured data reaches the recipient's system without delay, which can speed up invoice approval and payment.

Is PEPPOL only mandatory for B2G?

Currently, yes — the mandatory requirement only applies to transactions with the public sector. However, PEPPOL is also becoming the dominant standard in the B2B sector, as it is the same network that will be used for mandatory B2B e-invoices from 2028.

How to Send an E-invoice in Practice — Tools and Workflow

To send an e-invoice, you will need one of the following solutions:

1. Accounting software with PEPPOL support.

Horizon Cloud and Jumis already offer full PEPPOL integration — you create the invoice as normal, and the software sends it via the PEPPOL network. Visma (e-conomic) also supports PEPPOL. Pats.lv has limited PEPPOL support, so if you work with public authorities, check your software's capabilities.

2. A dedicated e-invoicing platform or service.

If your accounting software does not support PEPPOL, you can use an intermediary service (e.g. eInvoice.lv, Telema, Fitek) that converts your invoice into PEPPOL format and sends it to the recipient. Such services usually charge a per‑invoice fee or a monthly subscription.

3. An online portal.

Some public authorities offer the option of manually entering an invoice on their e‑procurement portal, but this is time‑consuming and not recommended for regular use.

Workflow:

1. Create the invoice in your accounting software, filling in all mandatory fields.

2. Add the recipient's PEPPOL identifier (the public authority will provide this; it may be, for example, the institution's registration number).

3. Choose "Send as e-invoice" or a similar option, and the software/service will send it.

4. You will receive an electronic confirmation of successful delivery.

How to Receive and Process Incoming E-invoices

E-invoicing is not just about sending — your business will also receive them from suppliers. In the voluntary B2B phase, more and more businesses will choose to send e-invoices, and you need to be ready to receive them.

Requirements for receiving:

• Your accounting software must be able to import PEPPOL‑format invoices.

• Alternatively, you can use an e-invoice reception service that converts incoming e-invoices to PDF or integrates them into your accounting system.

• The incoming e-invoice must be automatically posted — the software reads the data (supplier details, amount, VAT, payment deadline) and creates the corresponding entry without manual input.

Advantages:

• Time saving. No more manually copying data from a paper invoice.

• Error prevention. Automatic import eliminates transcription errors.

• Faster processing. The invoice enters the accounting system immediately, rather than waiting for someone to enter it.

What the EU E-invoicing Directive Means for Latvian SMEs Long-Term

The European Commission's "VAT in the Digital Age" (ViDA) proposal envisages that by 2030, the use of e-invoices in cross‑border transactions within the EU will become a mandatory standard for all VAT payers. Latvia's phased approach — first B2G, then B2B — is a direct step towards meeting these requirements.

Key long-term trends:

• Mandatory B2B e-invoicing from 1 January 2028.

• Standardised VAT reporting — in the future, VAT returns may be replaced by structured analysis of e-invoice data, carried out automatically by the tax authority (so-called "Digital Reporting").

• Reduced shadow economy — the more transactions are documented in a structured way, the harder it is to evade tax.

For small businesses, this means: if you implement e-invoice infrastructure now, you not only meet today's requirements but also stay a step ahead of competitors who will wait until 2028.

How to Prepare Your SIA for the E-invoicing Era

1. Check whether your accounting software supports PEPPOL.

If you use Horizon, Jumis, or Visma, you may only need to activate the relevant module. If you use Pats.lv or Excel, you will need to consider switching to software with PEPPOL support or using an intermediary service.

2. Register on the PEPPOL network.

To send e-invoices, your company must be a PEPPOL participant. Registration can be done through your accounting software provider or a dedicated PEPPOL Access Point provider (e.g. Fitek, Telema, eInvoice.lv).

3. Update your customer and supplier data.

To send an e-invoice, you need to know the recipient's PEPPOL identifier. Start with your public‑sector clients — request their PEPPOL ID.

4. Train your staff.

If multiple people issue invoices, make sure they know how to select the e-invoice sending option and what to do if the system reports an error.

5. Carry out test submissions.

Before sending your first real e-invoice to a public authority, test with the help of your PEPPOL service provider to make sure everything works.

E-invoicing is not just a new technology — it is a fundamental shift in how businesses communicate with the state and with each other. Companies that embrace this change early will gain a competitive edge — faster invoice payment, fewer errors, and a smaller administrative burden. Our team helps SIAs prepare for the e‑invoicing era — from setting up software to sending their first successful e-invoice.

Last updated: June 2026. Information is based on Cabinet of Ministers regulations on e-invoicing implementation, official PEPPOL documentation, and SRS guidelines.