How mandatory e-invoicing in the Baltics will affect Lithuanian businesses

Mandatory e-invoicing is rapidly expanding across the Baltic region. Latvia and Estonia are advancing toward full B2B digital mandates, while Poland is implementing its centralized KSeF 2.0 system with phased enforcement beginning in 2026. At the same time, the EU’s ViDA initiative reinforces the shift toward standardized digital VAT reporting across member states.

Although Lithuania has not yet introduced mandatory domestic B2B e-invoicing, Lithuanian companies operating cross-border are already impacted. Understanding regional timelines and technical requirements is essential to ensure compliance, maintain uninterrupted trade, and prepare for the broader digital transformation of VAT reporting.

Latvia: B2G already mandatory, B2B coming in 2028

Since January 1, 2025, all invoices sent to Latvian government institutions must be submitted electronically using the “e-adrese” system. This requirement ensures faster processing, greater transparency, and improved VAT collection.

Looking ahead, business-to-business (B2B) e-invoicing will become mandatory on January 1, 2028. This means that all Latvian businesses providing goods or services to other businesses will need to exchange electronic invoices.

Lithuanian companies working with Latvian partners should begin considering solutions that enable compliance with both B2G and B2B requirements, even before the B2B mandate becomes official.

Estonia: Buyer-choice model in 2025, full mandate in 2027

Estonia has long required B2G e-invoices, but starting July 1, 2025, a “buyer-choice” model was introduced. Under this model, any business registered as an e-invoice receiver can require its suppliers to issue invoices in electronic form, preferably in the EN16931 European standard.

By 2027, Estonia plans to make e-invoicing mandatory for all VAT-registered businesses in both B2G and B2B segments.

These changes aim to:

• Standardize document transmission.

• Reduce administrative errors.

• Improve financial control and VAT administration.

Lithuanian companies engaging with Estonian partners should be prepared to comply with these requirements when requested. Upgrading accounting systems and adopting e-invoicing solutions now can help ensure smooth business operations.

Poland: KSeF 2.0 Mandate Overview

Poland is gradually rolling out its e-invoicing mandate through the Krajowy System e-Faktur (KSeF) 2.0 system. While this article focuses on the Baltic region, it is useful for Lithuanian businesses to be aware of Poland’s requirements, especially for cross-border transactions.

Key points:

• February 1, 2026: Mandatory for large taxpayers (annual turnover above €47 million).

• April 1, 2026: Mandatory for other businesses except the smallest micro-entrepreneurs.

• January 1, 2027: Mandatory for micro-entrepreneurs with monthly sales under €2,350.

• Adaptation period: Penalties for KSeF errors are postponed until January 1, 2027.

• Benefits of early adoption: Improved compliance, standardized digital audit trail, operational efficiency.

For more detailed information, see Poland’s KSeF 2.0 - The Official E-Invoicing Mandate.

EU-Level developments: ViDA directive

The European Commission’s ViDA (VAT in the Digital Age) initiative promotes e-invoicing across the EU to improve VAT collection and cross-border transparency. It encourages the gradual adoption of mandatory B2B e-invoices in EU member states.

For Lithuanian companies trading internationally, understanding ViDA is essential, as cross-border partners will increasingly expect electronic invoice submissions in standardized formats.

Implications for Lithuanian businesses

Although Lithuania has already implemented B2G e-invoicing through the SABIS system, B2B e-invoicing is not yet mandatory domestically. However, several implications arise from the surrounding Baltic and EU landscape:

1. Partner requirements

   • Lithuanian businesses working with partners in Latvia, Estonia, or Poland may need to issue e-invoices in the formats required by those countries.

   • PDF invoices may no longer be sufficient for international partners.

2. Regulatory trends

   • Neighboring countries are proactively implementing B2B mandates to increase transparency and efficiency.

   • Lithuanian authorities may follow suit in the coming years.

3. Operational readiness

Updating accounting systems and adopting e-invoicing solutions in advance will reduce administrative burden and ensure compliance with foreign partner requirements.

How to prepare

Lithuanian companies should consider digital solutions that support multiple e-invoicing networks:

Banqup platform: Enables sending e-invoices to Peppol (European network), SABIS (Lithuania), “e-adrese” (Latvia), Estonia’s network, and soon Poland’s KSeF system. Generates XML/UBL invoices compliant with European standards.

Euroconnector: An API-based solution that integrates with accounting systems to send and receive e-invoices automatically through Peppol, track delivery status, and exchange messages with business partners.

Investing in these solutions now helps businesses stay compliant, streamline invoice management, and reduce operational risks associated with manual processes.

E-invoicing in the baltics

Mandatory e-invoicing is reshaping the Baltic and European business landscape. For Lithuanian companies, the need to comply with partner requirements in Latvia, Estonia, and Poland is already relevant, even before domestic B2B mandates are introduced.

By proactively adopting e-invoicing solutions and preparing systems for cross-border compliance, businesses can improve operational efficiency, reduce errors, and ensure readiness for upcoming regulatory changes. Staying informed and prepared is the key to seamless international business operations in the Baltics.

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