How does the invoice compliance check works?

Whenever a document is uploaded to VAT4U, the system process the image to detect if the document is potentially not compliant for VAT recovery. This article helps to understand how to interpret this result.

👉 What does "compliant" mean?

In order to be eligible for VAT recovery, a document needs to follow formal invoice (or simplified invoice) requirements. By requirements, we here refer to the level of information written in the invoice/receipt. Each country has its own preferences in this matter. When you are recovering VAT, the exigence of the country of refund becomes relevant. Since it can be challenging to assess manually 100% of your invoices and receipts, VAT4U developed a feature to identify invoices that are potentially not compliant.

👉 How does VAT4U checks if an invoice is potentially not compliant?

In order to help you identifying non-compliant invoices, VAT4U leverages from multiple information that can be clustered into 2 areas:

  • Missing information: VAT4U will detect if the document is potentially missing the required information (e.g. the claimant company name) in the document where this requirement was expected.
  • Disqualifiers: VAT4U will detect documents that should be disqualified for VAT recovery due to their typology: proforma invoices, duplicates, copies, other specific transactions.

Other parameters such as invoice amount and thresholds are taken into account.

This feature is supposed to be used as support within your assessment but does not guarantee that your invoice is compliant or not.  In addition, this feature does not assess the "content" of an invoice outside the formal requirements of the invoice. As an example, if the spend category of an expense is wrongly mapped this feature will not qualify the invoice as Potentially not compliant. 

👉 Where can I see if VAT4U identified an invoice as not compliant?

You can quickly view this in the expense list table in the field named "Compliance Status"