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The South African Revenue Service (SARS) has published a new consultation paper setting out how e-invoicingElectronic invoicing - widely referred to as e-invoicing - is the exchange of a digital document between a supplier and a buyer. E-invoices are issued, transmitted and received in a structured data format that enabled automatic and electronic processing. They contain data in a machine-readable format so that an AP system can read an invoice without manual data entry, leading to faster and more efficient invoicing. and digital VAT reporting could work in South Africa.
Published on 17 August 2026, the paper forms part of SARS’s wider Modernisation 3.0 programme and gives businesses a clearer idea of what future VAT reporting could look like.
Mandatory e-invoicing is not in place yet, but it is clearly part of SARS’s longer-term plans.
What is SARS Modernisation 3.0?
Modernisation 3.0 is SARS’s programme to update the way tax is administered in South Africa, with greater use of digital systems, data and automation.
The programme began in 2024 and is expected to continue through to 2029 and beyond. VAT modernisation is one of the main areas being worked on, including e-invoicing and more frequent electronic reporting.
The overall aim is to give SARS better access to transaction data and reduce reliance on information being provided only through periodic VAT returns.
What is being proposed?
The latest consultation sets out a proposed Digital VAT Model built around three main areas:
- E-invoicing, with invoice information created and exchanged in a structured electronic format
- Interoperability, allowing different systems and service providers to exchange invoice data
- E-reporting, giving SARS access to relevant VAT transaction information electronically
The important point here is that this would go further than simply emailing a PDF invoice.
Businesses would need to consider how invoice data is created in their ERPEnterprise resource planning (ERP) is a type of software that organisations use to manage main business processes. or finance system, how it is exchanged with customers and suppliers, and how the relevant information is then reported to SARS.
How could e-invoicing work?
SARS is looking at a decentralised model rather than requiring every business to use one government invoicing platform.
Under the proposals, invoices could be exchanged through accredited service providers using a common interoperability framework.
This would allow different systems and providers to communicate with each other while also supporting the reporting of relevant VAT data to SARS.
The exact technical requirements are still being developed, so businesses do not yet have a final specification to work towards.
When could e-invoicing become mandatory?
There is currently no general mandatory B2B e-invoicing requirement in South Africa and no confirmed implementation date.
SARS is still consulting on the proposed model, with comments on the consultation paper due by 16th October 2026.
Any future mandate is likely to be introduced in stages as the regulatory and technical framework develops.
So while there is no immediate deadline, businesses with South African operations should start paying attention to how the proposals progress.
What should businesses be looking at now?
There is no need to start implementing against requirements that have not yet been finalised.
However, this is a useful point for businesses to review how their current processes would cope with a future e-invoicing mandate.
That includes looking at:
- Where invoices are created across the organisation
- Which ERP and finance systems are involved
- How invoice data moves between systems
- The quality of customer, supplier and tax master data
- How VAT is currently determined and reported
- Whether existing integrations can support structured invoice data
For larger businesses, particularly those operating across multiple entities or systems, understanding and addressing these areas can take time. Starting that assessment now means businesses can identify potential gaps early, without committing to changes before the final requirements are confirmed.
