ViDA Compliance Guide: How to Prepare for the Initiative

It’s time to get ready for the EU’s VAT in the Digital Age (ViDA) initiative. ViDA has three components: Introducing VAT Digital Reporting Requirements, extending VAT to cover the platform economy, and expanding One-Stop Shop (OSS) VAT registration.

The mandate aims to reduce VAT fraud while modernizing the overall tax system. It is estimated that ViDA will lower VAT fraud by €11 billion within the first 10 years and cut down on some of the administrative burdens companies face when conducting international transactions. To make these changes, ViDA calls for all EU member states to adopt the Peppol open exchange network.

The initiative impacts all VAT-registered businesses in the EU. It will have the largest effect on SMEs participating in cross-border trade, who may need to overhaul their accounting systems and business processes to comply with ViDA’s new digital standards.

If your company operates in the EU, you will be impacted. Keep reading to find out what that means for your business and how to stay compliant with the updated regulations.

Why compliance is essential

If your business operates within the EU, ViDA compliance is mandatory. Noncompliance can result in penalties, which may include fines, business disruptions, and other consequences.

Beyond these legal risks, compliance is also essential to avoid the slowdowns associated with analog invoicing and business processes. Although most ViDA deadlines are still a few years away, adopting the initiative’s guidelines early can benefit your organization.

Digitizing workflows increases efficiency, improves accuracy, and promotes interoperability. Using e-invoices helps you get paid faster, plus processing is automatic, so there is no need to spend time checking statuses. E-invoices eliminate the opportunity for human error, reducing the number of mistakes you must spend time and resources correcting. The digital system makes it easier to innovate and incorporate new technologies, helping you stay flexible.

Switching from traditional paper invoices to electronic invoices can save your company time and money. Now is the time to assess your invoicing systems and begin preparing to go digital.

Read more: Request our free country-specific e-invoicing factsheets

When does ViDA go into effect?

The ViDA initiative was introduced by the European Commission in December 2022 and was approved by the European Parliament in February 2025, with its first guidance taking effect April 2025. After, it will be implemented in phases ending 2035. Here are the key dates:

14 April 2025: EU member states can require e-invoices for domestic B2B transactions without prior approval from the European Commission.

1 January 2027: The One-Stop Shop system will be expanded to include additional transaction types, including certain cross-border B2B supplies.

1 July 2028: New VAT rules for the platform economy come into effect. Member states can delay implementation until 1 January 2030. Additionally, further elements of single VAT registration are introduced.

1 July 2030: Companies must be capable of sending and receiving intra-EU e-invoices in ViDA-compliant formats. Digital reporting for intra-EU B2B transactions also becomes mandatory.

1 January 2035: EU member states must adapt their existing national e-invoicing systems to comply with ViDA’s formatting and digital reporting requirements.

ViDA's Digital Reporting section is based on the Peppol network, which Storecove can connect your business to.

What does ViDA cover?

The ViDA initiative has three core pillars: updating the VAT Digital Reporting Requirements, extending VAT to cover the platform economy, and expanding OSS VAT registration. Together, these elements will modernize VAT administration and align tax processes with today’s digital business landscape.

Digital Reporting

The first pillar of the ViDA initiative is an update to the VAT Digital Reporting Requirements. Before, businesses were only obligated to submit periodic VAT returns. With ViDA, transactions will be submitted to tax authorities in near real time, increasing transparency by giving further insight into each exchange. Until July 2030, businesses will have the option of submitting monthly invoice reports instead. After that, businesses must be capable of sending and receiving intra-EU e-invoices in a standardized digital format compliant with the ViDA framework based on Peppol.

Read more: Request our free Peppol Whitepaper

Platform Economy

The second pillar of the ViDA initiative is extension of VAT coverage to the platform economy. The platform economy refers to services facilitated through online platforms such as accommodation rentals and passenger transport (think AirBNB or Uber). Under ViDA, platform operators will be considered as the supplier by tax authorities in these scenarios.

This change will level the playing field between online and offline service providers, ensuring all parties are fulfilling their VAT obligations.

One-Stop Shop

The third pillar of the ViDA initiative expansion of the OSS VAT registration system. OSS allows companies doing business within the EU to register for VAT in just one member state instead of in every country where they operate. The change will reduce burdens for organizations participating in cross-border trade. The OSS updates are predicted to save businesses, especially SMEs, €8.7 billion in registration and administrative costs over the next decade.

Peppol can be used to transmit e-invoices across Europe and internationally.

How Storecove can sync your business with ViDA

As a ViDA-Ready organization, our e-invoicing API makes ViDA compliance easy. Our software automatically converts your invoices into compliant formats, even when trading with companies outside the EU, so you never have to worry about formatting issues, regulatory changes, or penalties. Your business can instantly meet ViDA’s e-invoicing requirements through a single connection to our API.

Storecove is a certified Peppol Access Point, enabling your business to connect seamlessly to Peppol, the global open exchange network mandated under ViDA. We ensure your documents meet current standards and remain compliant as those standards evolve. No need to spend time researching regulation changes or updating systems, we take care of that for you.

Our software is designed to support business growth, ensuring compliance, improving efficiency, and enabling smooth international transactions.

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