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The German e-invoice is coming to stay!

The introduction of e-invoicing in Germany affects businesses who invoice supplies to other businesses (B2B), provided that both businesses are established in Germany (including German fixed establishment, if involved in the supply). In these cases, as of January 1, 2025 (see transitional provisions below) invoices must always be issued as electronic invoices, i.e. in a specific structured electronic format (in accordance with CEN standard EN-16931). Paper-based or PDF-invoices are no longer permitted.

However, the law provides for the following exceptions, simplifications and transitional provisions:

  • The e-invoice obligation does not apply to invoices for small amounts (section 33 German VAT Implementing Regulation), tickets (section 34 German VAT Implementing Regulation) and supplies that are VAT-exempt in accordance with section 4 no. 8 to 29 German VAT Act.
  • Under certain circumstances, affected businesses can agree on an electronic invoice format that deviates from CEN standard EN-16931, provided that the VAT-relevant data can still be extracted in such a way that there is no difference to the use of CEN standard EN-16931. This should make it possible to continue using the e-invoice formats already introduced (such as XStandard or ZUGFeRD) or the EDI procedure.
  • Invoice issuers may invoice supplies carried out until the end of 2026 as before (e.g. in paper form or by using a PDF file).
  • Invoice issuers may invoice supplies carried out until the end of 2027 as before if they have a previous year's turnover (turnover calendar year 2026 pursuant to section 19 para. 3 German VAT code) of no more than EUR 800,000 or if they have already been using the EDI procedure (with the supply recipient's consent).

It is important to realize that there are no transitional regulations for invoice recipients. This means that invoice issuers may issue e-invoices from January 1, 2025 and invoice recipients must be able to receive and process them even if they do not yet issue e-invoices themselves. Invoicing by e-invoice then no longer depends on the consent of the invoice recipient in the cases prescribed by law.

As a result, the new legal regulation will be relevant for most invoice issuers from 2027, or from 2028 at the latest. Invoice recipients, on the other hand, will have to comply with the new legal regulation as of January 1, 2025. Affected businesses should timely check their processes and initiate the conversion process, if required.

Our recommendation: The focus should not only be on implementing the legal requirements. The introduction of a specific electronic invoice format with the associated possibilities for automating the invoicing process also offers considerable potential for cost savings, increased efficiency and effective staff planning.

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