GDPR and E-Invoicing: Balancing Retention with Data Protection

The GDPR Retention Paradox

E-invoices contain personal data (names, addresses, sometimes bank details of sole traders), but must be retained for years. How do you comply with both requirements?

The Right to Erasure vs. Retention

The "Right to be Forgotten" (Article 17 GDPR) is not absolute. It does not apply to the extent that processing is necessary for compliance with a legal obligation.

Legal Basis for Retention

Tax and accounting laws provide a legal basis for retaining invoice data, overriding the "right to erasure" for the duration of the mandatory retention period.

Article 6(1)(c) GDPR: Processing is necessary for compliance with a legal obligation.

Article 17(3)(b): Exception to the right to erasure for compliance with a legal obligation.

Data Minimization

While you must retain invoices, minimize unnecessary personal data processing:

Storage Limitation: Don't store invoices longer than the legal max (unless you have another valid reason).

Access Control: Restrict access to finance and audit teams only.

Anonymization: If using data for analytics, anonymize it first.

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Required Security Measures

GDPR Article 32 requires appropriate technical and organizational measures to ensure security.

Encryption

At Rest: Use AES-256 encryption for stored documents.

In Transit: Enforce TLS 1.2+ for all data transfers.

Access Logs

Maintain detailed audit logs of who accessed which document and when. This is critical for both detecting breaches and proving compliance.

Data Breach Notification

Have a procedure in place to detect, investigate, and report data breaches to the supervisory authority within 72 hours if personal data is compromised.

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Practical Compliance Steps

1Document your retention legal basis in your Record of Processing Activities (ROPA).

2Implement strict access controls (RBAC) and limit access to "need-to-know".

3Conduct regular DPIAs (Data Protection Impact Assessments) for the archiving system.

4Establish clear retention/deletion policies: Automate deletion after the 10-year period expires.

5Vendor Management: Ensure your archiving provider has a robust DPA (Data Processing Agreement).