Digital Accounting and E-Invoices in Latvia — Where We Stand in 2026
Latvia's move to digital accounting is happening in stages — and this staged approach often causes confusion about exactly what's mandatory and from which date. Let's clear that up right away: structured e-invoices for transactions with government institutions (B2G) have been mandatory in Latvia since January 1, 2025 — that's not new for 2026. What changes in 2026 is a separate, additional requirement: companies that already send e-invoices to government bodies must now also report the structured data from those invoices to the State Revenue Service (VID). And the next big step — mandatory e-invoices between businesses (B2B) — is scheduled only for January 1, 2028.
This article looks at where things actually stand in the middle of 2026 — what's already mandatory, what's new specifically this year, and what's still ahead.
Key takeaways
B2G e-invoices (business to government) have been mandatory since January 1, 2025 — not 2026, as is often incorrectly stated
As of January 1, 2026, companies that send B2G e-invoices must additionally report the structured data from those invoices to VID
B2B e-invoices (between businesses) are still voluntary — they become mandatory from January 1, 2028
An e-invoice must meet the PEPPOL BIS Billing 3.0 standard in structured XML format — a plain PDF, even a digitally signed one, does not qualify
If your accounting software already supports PEPPOL, moving to e-invoicing usually just means activating that module, not switching software
Where things stand — what's mandatory and what isn't yet
Already mandatory (since January 1, 2025):
Every supplier providing goods or services to a budget institution (B2G) must issue a structured electronic invoice.
The obligation applies to transactions with budget institutions; for contracts concluded before 31 December 2024 it must be applied no later than 1 January 2026 (Accounting Law, transitional provision 9).
The e-invoice must meet the PEPPOL BIS Billing 3.0 standard (based on LVS EN 16931-1:2017) in structured XML format — a plain PDF file, even one signed with an electronic signature, does not qualify.
New specifically as of January 1, 2026:
Companies that already send B2G e-invoices must additionally report the structured data from those invoices to VID — either automatically via the official electronic address, through an operator's channel integrated with VID, or manually uploaded via EDS within 5 business days.
This requirement applies only to B2G transactions — it does not introduce a new mandate in the B2B segment.
Not yet mandatory:
Business-to-business transactions (B2B) — mandatory e-invoices in this segment were originally planned from 2026, but the deadline has been pushed back two years, to January 1, 2028, giving small businesses, self-employed individuals, and other organizations time to prepare.
Until then, B2B e-invoices are voluntary — companies can start using them whenever they're ready, with no fixed "start date."
This phased approach makes sense — it lets the public sector become an "anchor client" that motivates businesses to invest in e-invoicing infrastructure before it becomes mandatory market-wide.
E-invoices for government institutions — what every supplier needs to know
If your SIA has ever issued an invoice to a ministry, municipality, school, hospital, or any other budget institution, you've been unable to do so on paper or as a plain PDF since 2025.
Requirements for a B2G e-invoice:
Structured XML format compliant with the EN 16931 standard and the PEPPOL BIS Billing 3.0 specification.
Automated processing — the recipient's system must be able to read it without human intervention.
Sent via the PEPPOL network — not by email.
Mandatory data — the supplier's and recipient's PEPPOL identifiers, invoice number, date, amount, VAT information, and procurement contract reference (where applicable).
As of 2026 — data reporting to VID as well, as described above.
What happens if you don't comply?
If a government institution receives a non-compliant invoice (for example, on paper or as a PDF), it's entitled to reject it. That means payment for the goods or services provided may be delayed until a proper 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-invoice exchange network that connects businesses with government institutions across Europe. Its purpose is to standardize the exchange of electronic documents, so a company can send an invoice to any European government institution using the same system.
How PEPPOL works:
Your company creates an e-invoice in your accounting software or a specialized e-invoicing platform.
The invoice is converted into PEPPOL BIS format and sent through your PEPPOL Access Point.
Your Access Point forwards the invoice to the recipient's (for example, a ministry's) Access Point.
The recipient's system automatically imports the invoice, checks it for compliance, and sends back a confirmation.
Advantages:
One connection, all of Europe. You don't need to register separately in each country's system.
Fewer errors. Automatic validation prevents manual entry mistakes.
Faster payment. Structured data reaches the recipient's system without delay, which can speed up invoice approval and payment.
Is PEPPOL mandatory only for B2G?
Currently, yes — the mandatory requirement applies only to transactions with the public sector. But PEPPOL is also becoming the dominant standard in the B2B space, since it's the same network that will be used for mandatory B2B e-invoices from 2028.
How to actually send an e-invoice — the principle, not a specific tool
To send an e-invoice, you'll need one of these types of solutions:
1. Accounting software with built-in PEPPOL support. Several accounting platforms used in Latvia already offer this integration — you issue the invoice as usual, and the software sends it through the PEPPOL network. If you're not sure whether your software supports this, that's the first question to ask your provider.
2. A specialized intermediary service or PEPPOL Access Point provider. If your accounting software doesn't support PEPPOL directly, you can use an external service that converts your invoice into PEPPOL format and sends it to the recipient. There are several such services on the market, and they typically charge per invoice or a monthly subscription — compare a few options rather than settling for the first one you find.
3. An online portal. Some government institutions offer the option to manually enter an invoice through their e-procurement portal, but this is time-consuming and not recommended for regular use.
Workflow regardless of the solution you choose:
Issue the invoice in your accounting software, including all the mandatory details.
Add the recipient's PEPPOL identifier (the government institution will provide this; it may be, for example, the institution's registration number).
Choose "Send as e-invoice" or a similar option, and the software/service will send it.
You'll receive an electronic confirmation of successful delivery.
How to receive and process incoming e-invoices
E-invoicing isn't just about sending — your company will also receive them from suppliers. As the voluntary B2B phase progresses, more and more companies will choose to send e-invoices, and you need to be ready to receive them.
Requirements for receiving:
Your accounting software needs to be able to import PEPPOL-format invoices.
Alternatively, you can use an e-invoice receiving service that converts incoming e-invoices to PDF or integrates them into your accounting system.
An incoming e-invoice should be posted automatically — the software reads the data (supplier details, amount, VAT, payment deadline) and creates the corresponding entry without manual input.
Advantages:
Time savings. No more manually retyping data from a paper invoice.
Fewer errors. Automatic import eliminates transcription mistakes.
Faster processing. The invoice lands directly in the accounting system instead of waiting for someone to enter it.
What the EU e-invoicing directive means for Latvian small businesses long-term
Directive (EU) 2025/516 "VAT in the Digital Age" (ViDA), adopted on 11 March 2025, introduces mandatory digital reporting for cross-border B2B transactions from 1 July 2030, and Member States may introduce mandatory e-invoicing earlier. Latvia's phased approach — first B2G, then data reporting to VID, then B2B — is a step in that direction.
Key long-term trends:
Mandatory B2B e-invoicing from January 1, 2028.
Structured data used for tax oversight — the 2026 requirement to report B2G invoice data to VID is a first step toward automated tax monitoring based on e-invoice data.
A smaller shadow economy — the more transactions are documented in a structured way, the harder it becomes to avoid paying tax.
For small businesses, this means: if you start building e-invoicing infrastructure now — even if it isn't formally mandatory for your segment yet — you're not just getting ahead of future requirements more comfortably, you're also 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 already work with the public sector, this support should already be active. If not, that's the first question to ask your software or accounting service provider.
2. If you send B2G e-invoices, make sure you've sorted out data reporting to VID — this is the new 2026 obligation, and it's easy to miss if your process was already set up before 2025.
3. Register on the PEPPOL network, if you haven't already. To send e-invoices, your company needs to be a PEPPOL participant — registration is usually done through your accounting software provider or a specialized Access Point provider.
4. 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 — ask them for their PEPPOL ID.
5. 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.
6. Run test submissions. Before sending your first real e-invoice to a government institution, run a test with the help of your PEPPOL service provider to make sure everything works.
E-invoicing isn't just new technology — it's a fundamental shift in how businesses communicate with the government and with each other. Companies that adopt this change early will gain a competitive edge — faster invoice payment, fewer errors, and a lighter administrative load. Our team helps SIAs prepare for the e-invoicing era — from a compliance check to the first successfully sent e-invoice. Get in touch with us, or see our accounting services.
Frequently Asked Questions
Have B2G e-invoices in Latvia been mandatory since 2025 or 2026?
Since January 1, 2025. This is a common misconception — many people confuse this date with January 1, 2026, when a different, additional requirement took effect (reporting data to VID), not the e-invoicing mandate itself. Exception: for contracts concluded by 31 December 2024, the obligation had to be applied no later than 1 January 2026.
What exactly changed on January 1, 2026, if B2G e-invoices were already mandatory since 2025?
Companies that already send B2G e-invoices must, as of January 1, 2026, additionally report the structured data from those invoices to VID — automatically via the official electronic address, through an operator's channel, or manually via EDS. The e-invoicing requirement itself doesn't change; what changes is that VID now also receives the underlying data.
As a small business, do I need to start sending B2B e-invoices now?
No, that's not mandatory until January 1, 2028. However, if your clients or suppliers already use e-invoices, it may be practically advantageous to switch earlier — you'll likely need to learn the process eventually anyway.
Does a PDF invoice with a digital signature count as an e-invoice?
No. An e-invoice must be in structured XML format compliant with the PEPPOL BIS Billing 3.0 standard — a visually readable PDF, even one signed with a secure electronic signature, doesn't meet this requirement.
What happens if I send a government institution an invoice in the wrong format?
The institution is entitled to reject it, which can delay payment until you prepare and submit a proper e-invoice.
Do I need to switch accounting software to send e-invoices?
Not necessarily. Many accounting platforms used in Latvia already support PEPPOL — check with your provider. If your software doesn't support it, an alternative is to use an external intermediary service rather than necessarily switching your whole system.
See also: invoice requirements and accounting automation.
Sources
Last updated: September 2026. Information is based on public materials from VID, the Ministry of Finance, and the Saeima regarding the e-invoicing implementation timeline. Before making decisions, it's advisable to check the current information directly with VID or consult an accountant.
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