eInvoicing by default guidance

eInvoicing by default

The Australian Government is transitioning to eInvoicing as the default way Commonwealth entities receive and send invoices for procurement. To learn more about this commitment, see eInvoicing for government.

This guidance is for non-corporate Commonwealth entities (NCEs) in implementing the Australian Government’s eInvoicing by default commitment. It's intended for:

• Chief Financial Officers and finance staff
• officials responsible for procurement and invoice processing.

We encourage Corporate Commonwealth entities (CCEs) to adopt the principles in this guidance.

Suppliers to NCEs should also be familiar with this guidance.

Receiving eInvoices

eInvoicing is the default invoicing channel for invoices:

• for procurement contracts
• exchanged between NCEs for goods and services.

Note:

• Being excluded from the Supplier Pay On-Time or Pay Interest Policy (RMG 417) does not exempt an invoice from eInvoicing requirements. For example, invoices for procurements funded through an administered appropriations must still meet eInvoicing requirements.
• The payment method, such as payments via credit card, does not exclude an invoice from eInvoicing requirements.
• If a supplier is unable or unwilling to adopt eInvoicing, NCEs should agree on an alternative invoicing arrangement and encourage future use of eInvoicing.

Payment times

Payment obligations continue to be governed by the Supplier Pay On-Time or Pay Interest Policy (RMG 417)External Link and don't affect requirements related to eInvoicing.

Encourage the use of eInvoicing

NCEs should also encourage the use of eInvoicing in the following circumstances:

• Existing contracts – NCEs should transition to eInvoicing where practical and by agreement with the supplier. Contract variations may be required where invoicing clauses exist.
• Goods and services are procured and consumed overseas – NCEs should consider eInvoicing where practical. Many overseas suppliers are already or are becoming Peppol eInvoicing enabled.
• Other transfers between NCEs – including staff-related liabilities and similar inter-agency transactions.

Transition

As the Australian Peppol Authority, the ATO, is working with the Department of Finance and the Digital Transformation Agency to review and update procurement arrangements, policies and guidance , including the Commonwealth Contracting Suite.

NCEs are to:

• continue engaging with suppliers to encourage and support their transition to eInvoicing
• incorporate eInvoicing by default in procurement contracts as policies, templates and guidance are updated
• not discourage or restrict the use of eInvoicing
• work with digital service providers (DSPs) to enable automated processing of eInvoices by December 2026.

Automated processing

eInvoicing provides structured data that can improve efficiency by reducing manual handling and supporting greater automation across accounts payable processes. Automated processing can include invoice ingestion, validation, workflow and payments. NCEs should work with DSPs to maximise automation where practical.

NCEs must have solutions that enable eInvoice data to be received directly into business systems with minimal manual intervention. For example, NCEs should replace interim solutions that convert eInvoices into PDFs or emails requiring manual processing.

NCEs should also improve automation over time. The appropriate level of automation will depend on several factors such as:

• invoice volume
• invoice complexity
• whether the NCE provides shared services to other entities.

Automation approaches

Smaller NCEs and lower-volume processing

For smaller NCEs with lower invoice volumes, the focus should be on achieving efficient processing through simple, cost-effective automation. This will typically involve using standard, out-of-the-box solutions that enable eInvoices to be received directly into business systems with little or no manual intervention.

Automation may include basic validation, invoice matching and reporting, while some workflow activities and exception handling may continue to require manual effort. These solutions can significantly reduce manual processing and delays while providing a practical and affordable approach to meeting eInvoicing obligations.

Larger NCEs and higher-volume processing

For larger and more complex NCEs with higher invoice volumes, automation should be integrated more deeply into accounts payable processes to maximise efficiency and scalability. This will generally involve tailored implementations that provide comprehensive validation, business rules, automated workflow routing, notifications, approvals and advanced matching capabilities.

Greater automation can support straight-through processing of suitable invoices, automated management of exceptions, and detailed reporting that assists with performance monitoring, compliance, assurance activities and eInvoice uptake measurement. While these solutions may require a higher initial investment, they are designed to support growth, shared-service arrangements and high transaction volumes while delivering greater long-term efficiency benefits.

Supporting documentation

Where supporting documentation is required, such as, timesheets or schedules, suppliers should provide these attachments to an eInvoice. For more information see Understanding and managing attachments in eInvoices and eCredit notesExternal Link.

Sending eInvoices

NCEs are to transition to eInvoicing as the default channel for sending invoices to entities registered on the Peppol network for activities where a tax invoice is issued.

This includes:

• commercial activities, such as the provision of professional or specialist services
• resource activities, such as the lease or use of public property or infrastructure
• charges between NCEs for goods and services, including legal services and shared services.

NCEs may also send eInvoices in the following circumstances:

• Recipient created tax invoices (RCTIs)
• Charges between government entities for staff liabilities, such as secondments and long service leave arrangements.

Recipient created tax invoices

The Australian market is not yet sufficiently mature to support widespread adoption of Peppol self-billing arrangements. Broader adoption is expected over time. Until then, RCTI processes are optional.

Transition

NCEs are to:

• work with DSPs to enable capability to send eInvoices by December 2026
• notify businesses about the transition to eInvoicing
• transition to sending eInvoices to entities registered on the Peppol network.

Guidance on identifying Australian entities registered on the Peppol network is available. Most entities that can receive eInvoices are also listed on the Peppol Directory. Some entities may choose not to be listed.

Reporting eInvoicing to the APA

The Australian Peppol Authority (APA) will collect regular implementation reports from NCEs to monitor progress. Reports may include:

• total number of invoices received during the reporting period
• total number of eInvoices received for the reporting period
• name and ABNs of suppliers that send their first eInvoice during the reporting period
• total number of invoices issued for the reporting period
• number of eInvoices issued for the reporting period.

The APA may request additional information where necessary to monitor progress and support implementation activities.

Examples