Written by
Sarah Raymond
Translated by Juhi Irfan

Published on

Table of Contents

Germany introduced e-invoicing later than some of its European neighbors. This requirement was first introduced in November 2020 for B2G (Business to Government) transactions before being gradually extended to B2B (Business to Business) transactions from 2025. 

From the control model and transmission methods to applicable standards and implementation timelines, here’s everything you need to know about electronic invoicing in Germany. 

Key Takeaways 

  • E-invoicing is gradually being rolled out in Germany, becoming mandatory for all B2B transactions on January 1, 2028. 
  • The invoice transmission method is flexible: companies can use an invoicing platform, Peppol, EDI, e-mail, etc. 
  • Any invoice format that complies with EN 16931 can be used, but the most common formats are XRechnung and ZUGFeRD. 
  • Invoice verification follows a post-audit model. 

How Does B2B E-Invoicing Work in Germany? 

On March 22, 2024, the Bundesrat (the German Federal Council with legislative powers) approved the Wachstumschancengesetz (Growth Opportunities Act). This law introduces mandatory B2B e-invoicing in Germany and redefines the concept of e-invoicing. 

It describes an e-invoice as an invoice that is issued, transmitted, and received in a structured format that allows for automated electronic processing. The structured data should allow the recipient to import the invoice information directly into their own system, without manual re-entry. 

This redefinition of electronic invoicing supports standardization, which is one of the government’s objectives in introducing this mandate. 

Why Is the German Government Introducing the Mandate? 

  • Combating VAT fraud: Germany is one of the EU countries with the highest VAT losses. 
  • Standardizing e-invoicing nationwide; 
  • Digitizing and modernizing the country’s economy; 
  • Aligning with the EU’s VAT in the Digital Age (ViDA) directive, which will mandate electronic invoicing for intra-EU cross-border transactions by 2030; 
  • Establishing the framework for a future transaction-based reporting system (e-reporting) 

These objectives are common to many countries in the European Union, an increasing number of which are introducing e-invoicing at the national level. 

The Implementation Schedule 

The B2B e-invoicing mandate is currently being rolled out according to the following schedule: 

Deadline Requirements 
January 1, 2025 All companies must be able to receive electronic invoices. 
January 1, 2027 Companies with an annual turnover of more than €800,000 must be able to issue electronic invoices. 
January 1, 2028 All companies, without exception, must issue and receive electronic invoices. 

The next implementation deadline is therefore January 1, 2027. Until then, businesses are only required to receive electronic invoices. Issuing invoices in PDF or paper format remains permitted during this transitional period, subject to the agreement of the recipient. 

What Formats are Accepted? 

The German mandate aligns with the European standard EN 16931, which defines the content and structure of electronic invoices in Europe to facilitate cross-border transactions. It is based on two reference syntaxes: UBL and CII. Therefore, all electronic invoices must comply with this standard and use a compatible format. 

Based on this standard, two main formats are used in Germany: 

  • XRechnung: a structured format, consisting only of an XML file. 
  • ZUGFeRD: the German equivalent of the French Factur-X format, a hybrid format that combines a human-readable PDF file and an embedded, machine-readable XML file. 

Any other format that complies with EN 16931 is also accepted, such as UBL 2.1 or Peppol BIS 3.0. Paper and PDF formats, on the other hand, will remain permitted in some cases during the transition period (from 2025 to 2028) but will be prohibited for domestic B2B transactions from January 1, 2028. Structured formats will then become the only authorized formats. 

What Transmission and Control Methods are Used for Electronic Invoicing in Germany? 

Unlike France, Germany does not impose any transmission channel for invoices. There is no approved platform through which they must be transmitted. Companies are free to use an e-invoicing platform, the Peppol network, EDI, or even a simple e-mail. However, while Peppol is not required under Germany’s B2B e-invoicing rules, the network is still widely used in the country for the exchange of invoices, both for incoming and outgoing transactions. 

Tax audits in Germany currently operate according to a post-audit model. Invoices are not checked at the time of their issuance. Instead, they are checked afterwards during tax audits, which can occur several months or even years after they are issued. This model presents a real operational risk because the authorities do not validate invoices before transmission. As a result, businesses may face penalties for non-compliant invoices months or even years after they are issued. 

The Federal Ministry of Finance (Bundesministerium der Finanzen, or BMF) has announced its intention to set up a national infrastructure for the transmission of electronic invoices. This would make it possible to transmit data automatically to the tax authorities on a model similar to the one already used in France or Italy. Germany would thus move towards a continuous control model, in anticipation of the future requirements of the ViDA directive. The details of this future system are still under discussion. 

Archiving and Electronic Signatures 

Electronic signatures are not mandatory for electronic invoices in Germany. 

The legal retention period for invoices has also changed recently. Many sources still refer to the previous 10-year period. However, the Administrative Simplification Act (Bürokratieentlastungsgesetz IV, or Fourth Law on the Reduction of Administrative Procedures) took effect on January 1, 2025. It reduced the retention period for invoices and accounting documents from 10 years to 8 years. This change is based on Section 147 of the German Fiscal Code (AO) and Section 14b of the German VAT Act (UStG). 

The new 8-year period also applies to invoices for which the previous 10-year retention period had not yet expired by December 31, 2024. 

What are the Penalties for Non-Compliance? 

The German VAT Act (UStG) provides for penalties for non-compliance, with fines of up to €5,000 for issuing or receiving non-compliant invoices. In addition to these direct penalties, a non-compliant invoice can also have indirect consequences such as disputes with customers or delays in payment collection. 

Exemptions from the Mandate 

Not all transactions are covered by Germany’s e-invoicing mandate. Some transactions are exceptions to the rule: 

  • B2C transactions: when the recipient is a private individual, the invoice can continue to be issued in paper or PDF format; 
  • Cross-border transactions: the German mandate only applies to domestic transactions, i.e., when both the supplier and the buyer are established in Germany. As soon as one of the two parties is established abroad, the mandate does not apply. These transactions will continue to operate under the current rules until ViDA comes into force, which is scheduled for 2030; 
  • Transport tickets (plane, train, bus tickets, etc.) also benefit from an exemption. 

What About B2G E-Invoicing in Germany? 

The electronic invoicing mandate began with B2G transactions in Germany. It was rolled out gradually between April 18, 2019, and November 27, 2020. 

Most B2G invoices are submitted via the single federal platform OZG-RE. It is used by the federal government, as well as by some Länder (federated states) of the country.  While the mandate is national, its application is decentralized: the Länder can apply certain rules of their choosing (invoicing platform, access points, invoice format, etc.), and some of them have chosen the OZG-RE platform for invoice exchange. 

However, a common requirement for all Länder remains: to maintain compatibility with Peppol and ensure interoperability at the national level.  

E-reporting will be Implemented Soon 

At the E-Invoicing Exchange Summit 2026 in Berlin, new deadlines for Germany were announced. E-reporting will gradually become mandatory to align with the ViDA directive, which is scheduled for 2030. 

Here are the announced milestones: 

Deadline Stage 
2027 Start of the legislative process 
2029 Voluntary pilot phase 
Mid-2030 Implementation of the national VAT reporting system 

The technical details have not yet been announced. 

Symtrax for Your Global E-Invoicing Needs 

Would you like to invoice in Germany? With its Compleo Invoice Platform (CIP) solution, Symtrax supports your e-invoicing needs in Germany and across international markets. As a Peppol access point, exchanges will be facilitated with companies that also use this network for their invoicing. Would you like to discuss your business needs and try our free demo? Contact us.