Challenges with Mexico’s 3.3 e-invoice

[mabar]

It had been an stressful two months since the implementation of the new aspects of the mandatory e-invoice in Mexico called version 3.3, for me had been a challenge because the software is not ...friendly?, it has many glitches so to speak, and for the time being I cannot change it. When I received the mail from the system supplier, I felt I was not able to comply it due to the complexity of the lexicon of this challenge, I wonder if it was the time to close business, right in time I was able, five days before the date line, few! one of the other challenges was to set/assigned the new codes to all products, perhaps in bigger business there are many, several or more than two people arranging/capturing those data, but for small business it gets more complicated.

Reading that Brasil was a kind of pioneer, I wonder if some descriptions-codes came from that country, some had been updated to more ...mexican lexicon, like for example, for one code was buckles for hair as hebillas para cabello as hair clips=pasadores


Researching a little bit, I found that there are several sites where the e-invoice is mentioned as quite benefical, paper less, etc... of course I would say, is part of their products, on the other hand I did not know that Latin America became the leading region!! ... to which I was quite surprised because is where the differences between small business and great corporations are quite visible, and I do really see all of this very wrong and maquiavelic, had they do not know of climate change? with electrical disruptions everywhere... not that they care either right? in Mexico is pretty much known that goverment want to have more control and tax money...

Electronic invoicing and concerns about the Mexican mandate
Posted by Pete Loughlin in AP Automation, e-invoicing, Electronic Invoicing19 Jun2013

It was announced a few weeks ago that the Mexican Government has given businesses just 6 months to prepare for a major legislative change that will directly affect hundreds of thousands of small and medium sized businesses. And it’s not a trivial change. If businesses want to get paid for goods and services they supply, they’ll need to ensure that they generate invoices correctly and in accordance with the new rules. It’s not optional. There’ll be no excuses.

It seems like a good idea to insist on the use of electronic invoices. It’s a mandate for common sense. The Mexican Government is embracing the digital age and at the same time implementing a zero tolerance approach to business taxes. But the rate of change they are imposing could create chaos as businesses fail to meet the deadline. ---as it happend as well with this new version

Up until the end of 2013, it’s only relatively large businesses that are obliged to send electronic invoices in Mexico – a business with revenue of less than MXN$4,000,000 escapes the mandate. But from January 2014, any business with a revenue greater than MXN$250,000 will need to issue Combrobante Fiscal Digital por Internet (CFDI) invoices generated by authorized third parties. The use of self-generated CFD invoices will no longer be allowed.

To put this in perspective MXN$250,000 is approximately US$20,000. This is a very low threshold and the change could affect 500,000 businesses.
So how will they cope? Will the Government infrastructure be up to it and will the authorized third party service providers be ready?
...

But in Mexico, revenue does not means profit...

[quote_ https://www.elsoldelbajio.com.mx/local/cuestionan-nueva-factura-electronica-version-3-3]
--using google traductor
Businessmen and public accountants in the country will propose adjustments to the new version of the digital invoice, known as CFDI 3.3, due to the administrative complexity that it will represent for companies, increasing their costs; but above all because it does not guarantee the legal security of the goods or products that are acquired.

The CPC Gonzalo Hernández Hernández, head of the firm of Public Accountants and Business Advisors "Russell Bedford", said that the Business Coordinating Council, Comparmex and Mexican Institute of Public Accountants, perform specific actions to request the Tax Administration Service (SAT) , modify Article 33-A, of the Reform of the Fiscal Miscellany 2017, to correct the new version of the electronic invoice, which will be mandatory as of December 1, although it is already available on the SAT page and can be used from this moment.

According to the analysis that has been made of the new version of the electronic invoice, CFDI 3.3, is very complex for any cause, be it a physical or moral person, mainly because a range of 52 thousand different products was created, determined in 17 new ones catalogs, which generates problems for its management in the administrative field, which will cause additional costs to the companies to administer, correctly and opportunely, the electronic invoicing; besides the costs to reform the administrative systems, control of inventories and control of production, among others, of each company ", he emphasized.

The SAT still has many elements to determine to monitor taxpayers and increase collection, there is no need to make procedures more complex, neglecting the safety of all taxpayers.
...
[/quote]

Mexican e-invoicing to the next level
December 22, 2017 / Niels Schellingerhout / Products

Mexican businesses are obliged to submit all outgoing invoices electronically to SAT using the CFDI (Certificado Fiscal Digital por Internet – Digital Fiscal Certificate via Internet). The CFDI is the document that vouches for an invoice. It is a file that includes all necessary information for a valid business transaction and is, once it has been transmitted to SAT, returned stamped with a unique electronic invoice number. This way, all involved parties are assured the invoice has been authorized and registered by SAT.
In 2016 SAT announced to be releasing a revised and simplified version of the e-invoicing system in the year following - E-invoicing CFDI version 3.3 will be valid and mandatory for all Mexican businesses starting January 1st 2018.
...
Some of the most relevant changes were:
• Classification of the vouchers in: Income, Exit, Transfer, Payroll and Payment
• Use of catalogs for the registration of most of the information
• Registration of previous CFDI's, which are related to the operation performed
• Registration of the Product- or Service-Key as well as the Units, according to SAT catalog
• Definition of Taxes on line level
• Application of discounts by amount
• Generation of a Confirmation Code when the total of the CFDI 3.3 exceeds the maximum allowed value, or exceeds the variation percentage that applies to the currency

Challenges of e-Invoicing in Mexico and LATAM countries
02/06/2017
Electronic invoicing for taxpayers is becoming a mandatory issue for companies throughout the world. The latest study on E-Invoicing/E-Billing International Market Overview & Forecast from Billentis calculates a volume of e-invoices exchanged that could reach 36 billion in 2017.
Countries across the American continent have been at the forefront in use of this technology for years, with Mexico and Brazil being the countries with the most advanced e-Invoicing legislations. Tax authorities within Central and South America are looking up to these models and adapting them to their own fiscal models, like those of Costa Rica and Colombia. However, in the United States e-invoicing is still in the initial stages of development in comparison to countries in Latin America and Europe.
Mexico has become a global e-invoicing leader through establishing a system which has influenced e-invoicing compliance on an international level. The Mexican CFDI has experienced updates since 2014 designed to ensure a better user experience, and to solve incidents that are detected over time with the application of this system.
This year, the CFDI will undergo a major evolution (VIDEO), introducing a new version 3.3 which will come into force on December 1, 2017. The new version includes changes in structure, data format, data features and data pools/catalogues, as well as in validations and calculation rules.
The update to version 1.2 of the Payroll Complement and the use of the Payment Receipt Complement, will also become mandatory this year, beginning December 1, 2017. México’s Tax Administration Service (SAT) also announced updates regarding the Foreign Trade Complement, where version 1.0 and 1.1 will coexist during 2017.

At first I thought it was a part of their plan to be prepared for the Trans-Pacific Partnership (TPP) but, this e-invoicing is getting stronger in Latin America ... to which I become more suspicious, though ...
_https://learn.sovos.com/electronic-invoicing/colombia-accelerates-einvoicing-large-taxpayers --Colombia
_https://learn.sovos.com/electronic-invoicing/costa-rica-e-invoicing-top-8-requirements-to-know – Costa Rica
_https://learn.sovos.com/electronic-invoicing/4-key-changes-in-ecuador-s-new-offline-e-invoicing-model --Ecuador
_https://learn.sovos.com/electronic-invoicing/brazil-eliminating-access-to-free-e-invoicing-software-3 --Brasil
_https://eeiplatform.com/18844/business-must-ready-einvoicing-2024-especially-latam-asia --- Your business must be ready for e-invoicing by 2024, especially in LATAM and Asia.

E-Invoicing in Latin America
Navigating the profits and pitfalls of government mandates

Mandatory electronic invoicing is sweeping Latin America like Pizarro on his quest for gold. The motive is still money — in this case, tax revenue. And like the conquistadors, these changes, introduced during the past few years and enhanced in late 2012, have left chaos in their wake.

Companies that can’t comply in time or keep up with the whirlwind of changes face stiff fines and sanctions, including jail terms — reason enough to make sure you pick a solution provider that knows the rules and has your back. Even more important, from a CFO/treasury perspective, is how well your provider prepares you to capitalize on the strategic opportunities created by this powerful combination of Big Brother and big data.

A whole new world
If you are reading this, you have no doubt heard of the sweeping changes in electronic invoicing that have thrust Latin America into the international accounts receivable and accounts payable spotlight. Financial compliance regulations in Latin America are among the world’s most complex. During the past five years, finance managers and information technology departments have struggled to align evolving requirements with inflexible enterprise resource planning (ERP) installations that have not been able to keep pace.

One of the most common mistakes U.S. companies make in approaching electronic invoicing in Latin America is assuming the process is similar to that of the European Union (EU). This is a serious mistake. With a focus on eliminating fraudulent tax practices, governments in Latin America are taking comprehensive steps to ensure that companies are paying their fair share, and they’re taking a hard line against companies that fail to comply.

The rules are different here
Here are the top five things you should know about mandatory e-invoicing, using Brazil as an
example:
1. Government must approve all transactions in advance.
All invoices must be submitted for government approval. Invoices for goods must be approved at the state level, and service invoices must be pre-approved at the city level. That’s a much stricter standard than in the EU, where governments may require electronic invoices from government contractors and suppliers but place no similar restrictions on business-to-business or business-to-consumer
transactions.
2. Real-time, fully integrated solutions are required.
The United States tends to be a little more loose with its definition of electronic invoices, including the electronic transmittal of static documents such as PDFs. Commerce in Brazil requires a highly evolved, real-time data stream integrated with the government and capable of generating approval keys in a matter of seconds.
3. Invoice approval is linked to ability to ship
A truck cannot legally leave the warehouse without a copy of the approved invoice. Trucks traveling without proof of government approval, in the form of a digitally authorized bill of lading commonly known as a DANFe
(Documento Auxiliar da Nota Fiscal – Electrônica), or with cargo found to be inconsistent with the DANFe, are subject to fines and confiscation.

4. Strict data formatting.
Latin America defines strict process standards — in Brazil, you have Nota Fiscal Eletronica 2.0, and in Mexico you have CFDI v3.2 (Comprobante Fiscal Digital por Internet) — which clearly outline the XML schema, integration touch points, process, archiving, and printing procedures. In the EU, regulations offer compliance guidelines, but they don’t mandate a specific format. And, of course, in the United States, pretty much anything goes.

5. ERP implications.
Latin American e-invoicing will affect your ERP configuration. The
solutions to comply in Brazil, Argentina, and Mexico require configurations and, many times, specific localizations to the ERP system before you can even send an electronic invoice.

Companies almost always underestimate the true cost of implementing, monitoring, and maintaining their accounting systems. Worse, most solution providers leave these issues to the customer, causing production support and change-management nightmares.
...

And is making noise in the US, found this _https://fedpaymentsimprovement.org/wp-content/uploads/e-invoicing-white-paper.pdf