As of January 1st, 2021, pursuant to Law 87/2019, the tax system reform “On electronic invoicing and turnover monitoring”, has officially entered into force in the Republic of Albania. The law amends all transactions occurring within the Republic and includes the reporting technicality to the tax authority as well as the application for electronic invoicing.
The reform allows for the automatic issuance of an electronic invoice with all the necessary information for both the seller and the purchaser at the time of the transaction. By registering the invoice, the declaration is valid for both parties in the transaction and is automatically reported to the Tax Authority.
The law has been initially applicable to all transactions between companies and public entities from January 1st, however as of July 1st, 2021 it will begin to apply to transactions amongst businesses. As of September 1st, 2021 it will be applicable to all cash transactions also.
In order to apply this reform, all businesses must possess the necessary information regarding the purpose and step by step implementation. Entities must also be equipped with a special software approved by the tax authority enabling for the issuance of electronic invoices. The list with software providers is published on the official website of Tax Authority.
Referring the publications of the Tax Authority, the purpose of this reform is real time reporting and the digitalization of the economy. The aim is to minimize the possibility of tax evasion and to increase the civic awareness on the importance of fair reporting. The expected results are the improvement on VAT and Income tax collections, the increase of efficiency in tax reporting as well as the improvement of controlling and field inspections due to the prompt reporting of each transaction.
Various online training sessions are currently being provided daily, throughout April 2021, for professionals and also for business representatives, in order to have a full understanding of the whole process and to achieve its implementation as efficiently as possible.
For additional information, please contact our Country Executive, Ms. Drilona Likaj, at our Eurofast office in Albania via email at email@example.com.
Eurofast is a regional business advisory organisation employing local advisors in over 23 cities in South East Europe & Middle East (SEEME). The Organisation is uniquely positioned as one stop shop for investors and companies looking for professional services in South East Europe & the Middle East.