Digitizing Bills: Here's How It Definitely Works!

1. How do you properly digitize and archive your invoices?
2. What requirements of the tax office do you have to consider?
3. How long should you store digitized invoices?
4. What are the advantages and disadvantages of digital invoices?
5. What are the advantages of digitizing invoices?
6. What are the disadvantages of digitizing invoices?
7. Digitizing invoices: Step-by-step guide
8. Which file formats are suited for digital invoices?
9. Which apps and software can you use to create digital invoices?
10. Conclusion: Digitizing invoices is child's play!

Everyday, business owners, artisans, service providers of all sorts are confronted with tons of paperwork and have to deal with accounting along with their core tasks. Wouldn't it be nice if one could digitize all these invoices thus drastically reducing the amount of paperwork? We will show you how to do this and why you should never work without digitized invoices again.

How do you properly digitize and archive your invoices?

As invoices form a crucial part of accounting, you have to proceed correctly when digitizing and archiving receipts. Under no circumstances should you forget the tax office's requirements otherwise you can expect unpleasant surprises. But don't worry, we'll explain exactly what you need to look out for, so that everything is correct in your paperless accounting.

What requirements of the tax office do you have to consider?

Firstly, the Principles of proper computer-based accounting systems (GoBS) must be observed with accuracy. They encompass all the guidelines set by the German tax administration for digital accounting or bookkeeping. All taxpayers, including yourselves, are responsible for compliance with these guidelines - particularly when digitizing receipts. Above all, it pertains to the accuracy, completeness, clarity, and security of your receipts. Even digitized invoices must comply with GoBS at all times.

Furthermore, it must be guaranteed that the digitalized invoices cannot be modified. This mainly concerns the archiving of receipts. Invoices should not be able to be falsified or altered either on the data carrier (hardware) or using software (for example, by access logs). You are responsible for your invoice’s safety. Regulate access or permissions to your receipts.

If you want to change digital documents like invoices, you must mark each change clearly. Not only the changed version but also the original invoice must then be kept safe, so that each change can always be traced. Moreover, the change history must not be altered, falsified or deleted.

How long should you store digitized invoices?

Both analog and digitized invoices and those already received digitally must be retained for 10 years. This applies to both incoming and outgoing invoices. When storing digitized invoices, it must therefore be ensured that the used image or data carriers are still functional and the invoices can be read even after 10 years.

What are the advantages and disadvantages of digital invoices?

More and more people are managing their invoices easily and securely with efficient digital Buchhaltung-softwares. Invoice programs help to keep track of all the receipts and facilitate the workflow. Furthermore, by utilizing different programs, paper invoices can be digitized and thus also digitally managed and even archived. We have summarized for you the actual advantages and disadvantages of digitizing receipts with an invoice program.

What are the advantages of digitizing invoices?

Easier Handling

Digitized invoices can easily and quickly be filed and are easy to find subsequently. Therefore, you no longer have to invest time in hole-punching, sorting, and searching for invoices, but can focus on your business's important matters.

Less space requirement and time spent

Say goodbye to crammed filing cabinets and entire collections of archived receipts! Using invoice programs, you can organize and archive your digitized receipts. Moreover, you can swiftly and easily find your archived invoices using keyword search and no longer have to rummage through full filing cabinets. So, you neither lose space in your office nor your nerves looking for the receipts.

Less cost

⁠You save on all paper and printing costs as well as postal charges for sending invoices. In addition, you do not have to invest in expensive filing cabinets and matching folders.

Location independent

⁠You can access your invoices and your invoice archive anytime and from anywhere and no longer have to drive to the office especially for that. You could even manage your invoices while on holiday, but who wants to work on their holiday?

Availability

In larger companies especially, often several employees and departments are responsible for handling or managing invoices. With digitized or digitally created invoices, all concerned employees and departments can simultaneously access the invoices. Therefore, no need to copy and manually distribute the invoices.

Protection from data loss

Who has never accidentally misplaced an important receipt? That's not possible with digital invoices. However, it is crucial to always maintain a backup of your digitized receipts or keep them in cloud storage. This way, you always have access to your digital invoices even in case of loss of the data.

What are the disadvantages of digitizing invoices?

Requirements of the tax office

Only those who fulfill the requirements of the tax office can deduct VAT. Therefore, invoices must be correctly digitized and archived.

Dependence on technology

Just as with reading emails or working on the computer, you are also dependent on technology (servers, cables, electricity) when digitizing invoices. If the technology leaves you hanging, you cannot read emails or work on your computer. So if it lets you down, you will just have to sit back and wait.

Data security and GDPR

If your invoices contain sensitive data, it is crucial that you make appropriate arrangements. Your digitized invoices should always be protected from hacker attacks and GDPR compliance should always be adhered to.

Digitizing invoices: Step-by-step guide

Step 1: Collect receipts and invoices

Before you start digitizing the invoices, collect all analog invoices that you want to digitize.

Step 2: Check receipts and invoices

Check your receipts once more for authenticity and completeness.

Step 3: High quality scanning or photographing of receipts and invoices

To manage invoices digitally, you then have to scan them using a scanner or simply take a picture with the mobile camera. Take care of the scan’s quality. For optimal results, we recommend scanners with a resolution of 300 dpi. There are various apps through which you can take high-quality images with your mobile.

Tip: If you want to scan invoices that are smaller than A4 format, you can use scan sleeves as well. This way, nothing will slide out of place while scanning and you can scan several small paper invoices all at once.

Step 4: Check scans/photos for readability

Has everything been correctly captured and are all digitized invoices easily legible? If this is not the case, you will have to take pictures of the invoices all over again or repeat the scanning process.

Step 5: File receipts and invoices

As soon as you have scanned or photographed all your invoices, you can forward them to a central email address and collect them there. Subsequently, you can gain access to your now digital invoices and take them into accounting. There, you can easily process, manage, and archive them.

Which file formats are suited for digital invoices?

When scanning or photographing invoices, you have several file formats available for storage. Usually, these formats are: TIF, JPG, PDF, and PDF-A.

Since PDF-A is a standardized format, we recommend you to always store your digital receipts in this format. But TIF, JPG, and PDF are also possible formats. We advise against DOCX, ODT or XLSX, if your digital invoices need to be unmodifiable according to GoBS after storage.

Which apps and software can you use to create digital invoices?

There are already many apps and software that can assist you in creating digital invoices. In addition to that, they prepare digital invoices in such a way that you can directly forward them to your tax consultants or transfer them into the accounting software. Since each company has different requirements, it is important to find the appropriate invoice program for your situation.

Whether you are looking for the best software or app for service providers, artisans or small business owners, we have taken a closer look at them for you and our OMR-Reviews users have rated them.

GetMyInvoices.com

sevdesk

Lexware Office

DATEV

orgaMAX Buchhaltung

Zervant by Ageras

Moss

easybill

FastBill

Papierkram

Conclusion: Digitizing invoices is child's play!

Just photograph or scan invoices and you can manage and archive them digitally. In addition, there are already many software and apps that can help you with this.

Curious? Then compare the Buchhaltung on OMR Reviews and decide for yourselves which is the perfect invoicing program for you and your digital invoices.

This way, not only will you save valuable time digitizing invoices in future, but you can also manage and archive them easily. So that you can focus on what is truly important.