For many businesses, invoicing is still a slow, manual process that involves delays, potential errors, and administrative work. Electronic invoicing (e-invoicing) helps you avoid many of those issues: instead of chasing down payments or fixing typos in emailed PDFs, businesses can use a secure, automated system that moves invoices directly between finance systems.

In this guide, we’ll discuss what businesses in New Zealand need to know about e-invoicing, from how it works to how to get started.

What’s in this article?

• What is e-invoicing and how is it different from traditional invoicing?
  
• Is e-invoicing mandatory in New Zealand?
  
• How does Peppol impact e-invoicing in New Zealand?
  
• What are the benefits of e-invoicing for businesses in New Zealand?
  
• How does e-invoicing affect tax compliance in New Zealand?
  

What is e-invoicing and how is it different from traditional invoicing?

Traditional invoicing slows payments down. A paper invoice needs to be printed and posted. A PDF invoice needs to be emailed and manually entered into a finance system. These extra steps introduce delays, errors, and even the risk of lost or ignored invoices.

E-invoicing is the digital exchange of invoice data between businesses, structured in a format that accounting systems can read automatically. Unlike traditional invoices, e-invoices don’t require manual data entry. The invoice goes directly from the sender’s system to the recipient’s accounting software through an accredited e-invoicing network that uses machine-readable data in a format such as XML or JSON. The buyer’s system receives the invoice, validates it, and processes it, all without human intervention.

E-invoicing is on the rise globally, with the e-invoicing market expected to grow by an average of 28% annually from 2024–2028. Governments across the world are also pushing for adoption; Italy and Mexico already require e-invoicing for businesses.

Is e-invoicing mandatory in New Zealand?

No, e-invoicing is not required for most businesses in New Zealand. Still, it’s gradually becoming the standard, and accounting platforms such as Xero and MYOB already support e-invoices. While you won’t face penalties for sticking with PDFs, you might miss out on faster payments and more efficient operations.

Government agencies

New Zealand’s government is actively encouraging adoption of e-invoicing. If you work with government clients, expect them to increasingly request e-invoices. By January 2026, more mandated government agencies will be required to send and receive e-invoices, which means businesses that invoice these agencies must also send e-invoices.

Private companies

E-invoicing remains optional for private businesses that don’t work with government agencies. There’s no law that requires companies to use it, and there are no formal plans for a mandate.

But the Ministry of Business, Innovation & Employment (MBIE) is promoting the practice. It maintains a public list of more than 50,000 businesses that are already registered to receive e-invoices, which can be helpful if you’re looking for trading partners that already use e-invoices.

Coordination with Australia

New Zealand and Australia have committed to a shared e-invoicing framework so businesses can easily invoice across borders. Instead of passing mandates, these countries’ governments have focused on making e-invoicing so beneficial and easy to adopt that companies do so voluntarily.

How does Peppol impact e-invoicing in New Zealand?

New Zealand’s e-invoicing framework is built around Peppol, a global network that lets entities exchange invoices digitally using standardised language. Instead of supporting a custom integration for each partner, a company can use Peppol as a universal connector to more easily send invoices between businesses, government agencies, and international partners.

Why did New Zealand adopt Peppol?

New Zealand and Australia adopted Peppol in 2019 to create a simplified e-invoicing system with the PINT A-NZ format. This allows the two nations to work within an existing global standard instead of developing a new system from scratch and also enables easy Trans-Tasman invoicing.

With Peppol, any business that’s connected to the network – whether in New Zealand, Australia, or another country – can send and receive invoices without worrying about file formats, software compatibility, or manual data entry. Peppol eliminates the inefficiencies of multiple, incompatible invoicing formats, allowing invoices to flow easily.

How does Peppol work?

Peppol operates on a four-corner model. Invoices move through a structured, secure network. Here’s how it works:

• The sender’s accounting system creates an e-invoice in the standardised format and sends it to a Peppol Access Point.

• The sender’s Access Point verifies the invoice details and routes the invoice securely.

• The recipient’s Access Point receives the invoice and delivers it to the recipient’s accounting system.

• The recipient’s system automatically processes the invoice, with no need for manual data entry or validation.

Invoices sent through Peppol also benefit from stronger fraud prevention. Information exchanged over the network is encrypted and authenticated to prevent tampering or fraudulent invoices. Peppol has also been specifically adapted for Australia and New Zealand’s business environment: the PINT A-NZ standard ensures compliance with local goods and services tax (GST) reporting, and businesses can send invoices across borders without worrying about local tax issues.

New Zealand’s government has integrated Peppol with its systems, and central government agencies can now receive Peppol e-invoices. This creates a network effect: as more government suppliers use e-invoicing, adoption among private businesses will likely accelerate as a result.

What are the benefits of e-invoicing for businesses in New Zealand?

E-invoicing fundamentally improves how businesses handle payments and stay compliant, and greater efficiency can mean faster payments, lower costs, and higher security standards. Here’s how e-invoicing benefits businesses in New Zealand.

Faster payments and better cash flow

Manual processing, missing details, and slow approval cycles all delay payments. The MBIE found that after adopting e-invoicing, it was able to pay suppliers three days faster on average. A few days might not sound like much, but over the course of a year and beyond, this can substantially improve a company’s cash position. That can be especially beneficial for businesses that operate on tight margins.

Lower processing costs

Processing an invoice isn’t free, and the labour costs from manually handling invoices add up fast, particularly for companies that handle high invoice volumes each month.

Fewer errors and disputes

A simple typo can delay a payment for weeks. Many invoice disputes stem from incorrect amounts or calculations or mismatched purchase order numbers. These require follow-ups. E-invoicing can eliminate these errors because data flows directly from one finance system to another, without requiring re-entry.

Less administrative work and paperwork

Businesses that use traditional invoicing spend a substantial amount of time generating invoices, sending them, filing copies, and manually logging invoices received from vendors. E-invoicing automates many of these processes. Digital invoices are faster to create and send, and invoices arrive in your accounting system for easier review.

Stronger security

Invoice fraud is a real issue, particularly with emailed invoices. Common scams include intercepted PDFs where fraudulent actors change bank details and fake invoices that businesses unknowingly pay. E-invoicing is substantially harder to manipulate because:

• Transactions move through a secure, encrypted network

• Every invoice contains verified sender and receiver identifiers

• There’s an audit trail of the invoice’s path

These protections help reduce the risk of fraud and verify that invoices originate from legitimate, trusted suppliers, which is especially valuable for businesses that process high-value transactions.

Easier recordkeeping

New Zealand businesses must store invoice records for at least seven years for tax purposes. E-invoicing makes this simpler by automatically archiving invoices in your accounting software and indexing important details (e.g. supplier, date, GST) for quick retrieval.

Better visibility

E-invoicing provides real-time visibility into your accounts. You can instantly see which invoices are delivered, viewed, approved, or paid in your system and use structured data to analyse payment cycles, late payers, and cash flow trends.

How does e-invoicing affect tax compliance in New Zealand?

E-invoicing makes compliance with GST rules easier, improves business records, and reduces the risk of tax fraud. Inland Revenue Department (IRD) regulations accommodate e-invoicing so businesses can stay compliant without extra paperwork. Here’s how e-invoicing impacts tax compliance for businesses.

GST records

Traditionally, New Zealand businesses had to provide “Tax Invoice” documents with details such as the supplier’s GST number, invoice date, and GST amount to support claims. New Zealand updated its tax laws as of April 2023 and replaced the old tax invoice requirement with a more flexible concept called “taxable supply information”, so businesses can use a wider range of records or a combination of records (e.g. purchase orders, ledgers, supplier agreements, contracts) to support their GST returns. E-invoices are considered valid GST records under this change.

GST returns

E-invoicing integrates directly with accounting systems, automatically capturing:

• Total sales

• Total GST collected

• Total GST paid

This real-time accuracy minimises common reporting mistakes, such as typos and missing invoices. Some businesses can even automate parts of their GST return processes.

Audit readiness

Because e-invoicing simplifies tax reporting and recordkeeping, it also improves audit readiness. Every e-invoice leaves a digital audit trail, which makes it easier to verify transactions. If New Zealand ever moves towards real-time GST reporting, businesses that use e-invoicing will already be prepared.

Recordkeeping

New Zealand law requires businesses to retain invoice records for at least seven years. E-invoicing makes recordkeeping much easier in the following ways:

• E-invoices are easier to store and more secure than paper files or scanned PDFs.

• You can search for and retrieve invoices instantly, rather than manually sorting through old paperwork.

• There’s no risk of lost, faded, or damaged paper invoices.

• Even if a business switches software or providers, invoice data can be exported and preserved for taxes.