Electronic Invoicing in Iceland: Essential Guide and Regulations

Since 2020, Iceland has acted as a Peppol authority through the Icelandic Financial Management Authority (FJS), acting on behalf of the Ministry of Finance and Economic Affairs. This designation positions Iceland within the European network of countries that have adopted Peppol as the official infrastructure for electronic document exchange, particularly in the context of public procurement and electronic invoicing.

As the national Peppol authority, the FJS is responsible for overseeing the technical implementation of the system, authorizing Access Points operating within the country, and ensuring that both public and private entities comply with the technical standards defined by the Peppol ecosystem.

The official e-invoicing platform used in Iceland is the Peppol eDelivery Network, a secure infrastructure based on open standards that enables companies and institutions to exchange electronic invoices and other commercial documents in a structured, standardized, and legally valid way throughout Europe and beyond.

B2G Electronic Invoicing  in Iceland

According to the directive of the Ministry of Finance and Economic Affairs, all economic operators issuing invoices to public entities,whether central, regional, or local, must use electronic invoicing.

Similarly, all government entities are required to receive, validate, and process invoices electronically, thereby eliminating the use of physical documents or manual processes in public payment management.

Only electronic invoices that comply with the European standard EN 16931 CIUS (TS-236) are accepted, ensuring consistency, data integrity, and interoperability within the European Economic Area.

B2B Electronic Invoicing in Iceland

In Iceland’s private sector (B2B), electronic invoicing is not currently mandatory, but it is fully permitted as long as both parties, issuer and recipient, agree. In other words, the use of electronic invoices in business-to-business transactions is subject to the buyer's consent, which allows for some flexibility in adopting customized digital solutions based on each organization's technological maturity or operational preferences.

However, while their use is not mandatory, electronic invoices must meet certain legal requirements, particularly regarding content integrity and origin authenticity. This means that businesses must be able to prove that an invoice has not been altered since it was issued and that it genuinely originated from the declared issuer.

To guarantee this, Iceland allows taxpayers to choose from several recognized methods, such as:

• Advanced electronic signatures to authenticate the issuer and protect document content.
• Secure Electronic Data Interchange (EDI) ensuring communication traceability between systems.
• Documented and auditable internal management controls to ensure the validity and traceability of the invoicing process.

Accepted Format

Electronic invoices in Iceland must be sent in one of two authorized formats, both aligned with the EN 16931 standard: 

• UBL 2.1: A widely used XML format recommended by Icelandic authorities. 
• PEPPOL BIS Billing 3.0 CIUS: A UBL-based variant used in the Peppol network, designed to facilitate cross-border electronic exchange.

Iceland requires electronic invoices to be archived for a minimum of seven years. Archiving abroad is permitted under certain conditions:

• The archiving country must have a data protection agreement with Iceland.
• There must be a valid reason for archiving outside the country (for example, if the primary storage system is abroad).
• The Ministry of Finance must be formally notified of this decision.

How Can EDICOM Help You Comply in Iceland?

EDICOM, as an international provider specializing in electronic compliance solutions, offers a comprehensive e-invoicing platform that makes it easy for businesses to quickly adapt to Iceland’s legal requirements in both B2G and B2B environments.

EDICOM is a certified Peppol Access Point, allowing companies to connect directly to the Peppol Delivery Network to issue and receive electronic invoices in UBL 2.1 and PEPPOL BIS Billing 3.0 CIUS formats, which are fully compatible with the EN 16931 standard.

Our solution guarantees:

• Integration with any ERP or business management system.
• Advanced electronic signature and structural validation in accordance with Icelandic regulations.
• Legal and secure storage for the required period of seven years, either locally or with validation for international archiving.

Whether your company needs to invoice the Icelandic public sector or aims to optimize invoicing workflows in the private sector, EDICOM offers a robust, automated, and scalable solution to operate legally, securely, and efficiently in Iceland and across Europe.