The image of the traditional British finance department is undergoing a radical transformation.
Right now, speed and accuracy are the currencies of the finance function. Yet, despite the availability of advanced technology, a surprising number of UK SMEs still rely on manual data entry to manage their accounts payable.
Using invoice scanning software is no longer just about the environmental goal of “going paperless.” It is about unlocking the value of your financial data.
But how exactly does it work? More importantly, how do you use it to actually save time rather than just adding another administrative step to your process?
Let’s talk about that… in detail.
The Statistical "Why": Understanding the Urgent Need for Change
Before we open the software and click “upload,” we must look at the numbers to understand why a busy Finance Director should invest time in learning a new tool. The hidden costs of manual processes are often higher than businesses realise.
Industry benchmarks paint a concerning picture of the manual approach:
- High Costs: Manual invoice processing costs the average UK business between £12 and £15 per document. This includes labour, storage, and the time spent fixing errors. Scanning software drives this down to roughly £1.50.
- Slow Cycles: Manual entry takes an average of 16.3 days to cycle an invoice from receipt to payment. Automated solutions can reduce this to just 3 to 4 days.
- Error Rates: Human data entry has an average error rate of 3.6%. While this seems low, for a company processing 500 invoices a month, that is nearly 20 errors requiring investigation every single month.
By switching to automation, you are removing a significant financial leak from your operations.
The Technology Behind Invoice Scanning Software
A common misconception among new users is that invoice scanning is simply taking a picture of a receipt and storing it in a digital folder. If that were the case, the utility would be limited, as you would still have to type the numbers into Xero or QuickBooks manually.
Modern software uses two technologies working in tandem:
Intelligent OCR and Contextual Machine Learning.
OCR (Optical Character Recognition) identifies shapes that look like letters and numbers.
However, the “EazyCapture edge” is the contextual AI.
AI is transforming accounting software. The software does not just see the number “£1,200”; it understands the context. It recognises that because this figure is near the word “Total,” it represents the Gross Amount. It understands that the 20% calculation above it is the VAT.
Modern systems like EazyCapture perform four key functions:
1. Digitisation – converting paper or emailed invoices into a clean, readable digital format.
2. OCR + AI Extraction – automatically pulling essential data such as totals, VAT, supplier details, invoice numbers, due dates, PO numbers, and line items.
3. Validation – checking if data is complete, correct, and compliant with VAT or internal rules.
4. Automation – routing invoices for approval, pushing data into your accounting system, and maintaining an audit-safe archive.
This means you’re converting your invoices into actionable, structured financial data.
And here’s how you can do that with an accounting and bookkeeping assistant like EazyCapture.
Step 1: Collect and Upload Your Invoices
Start by gathering the invoices that reach your business. UK companies typically receive invoices through:
- Email attachments (PDF, PNG, JPG)
- Supplier portals
- Paper mail
- Scanned paper documents
With EazyCapture, you can upload any format, including mixed batches. The system automatically reads every file and begins extracting data immediately.
💡Tip: Upload a few sample invoices first to see how the AI handles different suppliers, formats, and layouts.
Step 2: Let the Software Extract and Read Your Data
Once uploaded, the software uses OCR and machine learning to:
- Identify fields like totals, VAT, dates, line items
- Pick up supplier names, addresses, and VAT numbers
- Detect invoice numbers and match them with POs
- Recognise multi-page documents automatically
EazyCapture is built specifically to reduce manual work here. Rather than typing data into spreadsheets or Xero/QuickBooks, the tool auto-extracts everything with high accuracy.
Why this matters for UK businesses: UK VAT rules rely heavily on accurate invoice capturing. Poor data entry leads to misclaimed VAT, incorrect returns, or compliance issues, all of which can be avoided when the software extracts the data consistently.
Step 3: Validate, Check, and Correct Exceptions
After extraction, the system automatically flags:
- Missing VAT data
- Wrong totals or mismatched line items
- Duplicate invoices
- Incorrect supplier ID or PO information
- Suspicious amounts or date inconsistencies
This step ensures the invoice is correct before it goes into your accounting software.
For UK businesses preparing for VAT audits under HMRC’s Making Tax Digital (MTD) rules, this kind of pre-validation is extremely valuable.
Step 4: Route the Invoice for Approvals
Every business has its own approval flow. Some require one manager’s sign-off; others need multi-level approvals depending on:
- Department
- Invoice value
- Supplier type
- Contract rules
Invoice scanning software turns this into a smooth digital workflow.
EazyCapture automatically sends invoices to the right approvers. No chasing, no paper folders, no emailed reminders. Approvers can check and sign off instantly.
Step 5: Export to Your Accounting/ERP System
After approval, the invoice data is pushed into your accounting software. UK businesses typically use systems like:
- Xero
- QuickBooks
- Sage
EazyCapture (which currently supports Xero and QuickBooks and is developing support for other systems too), supports standard export formats and integrations, meaning:
- No retyping
- No copy-paste errors
- No mismatched totals
- Clean, audit-ready data
You also keep the digitised invoice as a permanent record for VAT and audit requirements.
Step 6: Store, Search, and Stay Audit-Ready
The HMRC requires businesses to keep digital records as part of MTD, and invoice scanning software helps you stay compliant.
With EazyCapture:
- Every invoice is archived
- Every action is logged (upload, validation, approval)
- You can instantly search any invoice by supplier, amount, date, or keyword
- Documents remain available for VAT inspections or audits
This replaces physical file cabinets and chaotic folder systems with a structured digital archive.
Step 7: Analyse Your Invoice Data for Insights
Once your invoices are digitised and searchable, you gain access to insights that are impossible to see in manual spreadsheets.
UK businesses are increasingly using invoice automation not just to save time, but to improve financial decision-making.
With systems like EazyCapture, you can analyse:
- Average time taken to approve invoices
- Top suppliers by spend
- Invoices frequently submitted late
- Departments causing approval delays
- Common VAT discrepancies
- Average cost per invoice before vs after automation
- Duplicate invoice attempts or high-risk suppliers
This data becomes extremely valuable during cash-flow forecasting, budgeting, and supplier negotiations.
With EazyCapture, managers can also spot:
- Spend overshooting
- Opportunities for early-payment discounts
- Bottlenecks in approval hierarchies
- High-volume vendor patterns
- Workload distribution among AP staff
This transforms invoice scanning software from a simple “digitisation tool” into a continuous optimisation engine.
Best Practices for UK Businesses
To get the most out of your invoice scanning software, follow these three golden rules:
1. "Snap as you Spend"
Do not let receipts pile up. EazyCapture is your best friend. Train your team to snap a photo the moment they pay for fuel or client entertainment. EazyCapture takes seconds to upload, preventing lost receipts (and lost VAT reclaim opportunities).
2. Automate the "Boring"
Set up email forwarding for every recurring bill. You should never have to manually handle a gas bill or internet invoice again. Let the software catch it, extract the data, and queue it for approval.
3. Review Your Asset Register
Use the Asset Classification feature. Many businesses write off small assets as expenses incorrectly. By correctly classifying tangible vs. intangible assets at the point of capture, you ensure your balance sheet is healthy and your capital allowance claims are accurate.
Comparison: Manual Processing vs Invoice Scanning
Feature / Task | Manual Invoice Processing | With EazyCapture (Invoice Scanning) |
Data entry | Typed manually — slow and error-prone | AI-powered extraction (automated) |
Time per invoice | 2–5 days including approvals | Over 1 min in most cases |
Cost per invoice | £9–£16 average | £0.50 |
VAT accuracy | High risk of mistakes | Automated checks + validation |
Duplicate detection | Very difficult manually | Built-in duplicate alerts |
Audit preparation | Weeks of work | Instant, searchable records |
Scalability | Requires hiring more staff | Scales instantly without extra headcount |
‘Accurate’ Invoice Scanning Is No Longer Optional
Invoice scanning software is the present standard for efficient UK finance operations. As businesses face rising compliance expectations, tighter margins, and labour shortages, automation becomes essential rather than optional.
Using software like EazyCapture ensures:
- Lower invoice-processing costs
- Faster payments and approvals
- Fewer errors and duplicates
- Stronger VAT and audit compliance
- Scalable financial operations
- Happier AP teams
- Better visibility into spend
If your organisation is still relying on manual invoice entry, now is the time to adopt a digital-first approach.
And what better way to do it than switching to EazyCapture?
