You are here: Document Automation / Compliance / E-invoicing compliance / Germany

E-billing compliance Germany

Note: For the most current status, consult the European Commission website.

Germany has long been the subject of speculation on how they will implement mandatory B2B e-invoicing. With the Cabinet version of the draft law published on Aug. 29, 2023, and with the Federal Ministry of Finance providing guidance on the subject at the Exchange Summit in Dublin from Oct. 2-4, 2023, we now have a better understanding of what lies ahead.

Unlike some of its neighbors, Germany has not yet decided which type CTC model it wants to implement for Digital Reporting Requirements (DRR), but is currently waiting for more clarity from the VAT in the Digital Age (ViDA) proposal. Instead, the German obligation will initially focus on regulating the e-invoice formats allowed on the market, as well as the rules regarding buyer consent to e-invoices receiving.

Timeline

From Jan. 1, 2025: EN-compliant e-invoice becomes the standard (but not yet mandatory) in Germany.

All companies are required to accept an EN16931-compliant e-invoice (e.g., XRechnung); in other words, a supplier may issue an EN-compliant e-invoice (including EN-compliant EDI) and send it to any buyer without seeking prior approval.

• The supplier may still issue (1) paper invoices, (2) invoices in unstructured formats (e.g., PDF), and (3) non-EN-compliant EDI invoices. However, these are subject to phase-out (see below).
• The use (issuance and exchange) of invoices in unstructured formats and non-EN-compliant EDI e-invoices is permitted only with the consent of the buyer.

From Jan. 1, 2026: Phase 1 in the phase-out of non-EN-compliant invoices.

• Companies with sales >800T€ in the previous year may no longer issue invoices (1) on paper or (2) in unstructured electronic formats. Not even with the buyer's consent.

From Jan. 1, 2027: Phase 2 in the phase-out of non-EN-compliant invoices.

• All other companies may no longer issue invoices (1) on paper or (2) in unstructured electronic formats. Not even with the buyer's permission.

From Jan. 1, 2028: Phase 3 in the phase-out of non-EN-compliant invoices.

• Only e-invoices that comply with EN16931 are allowed to be issued, exchanged and receiving. This means that (3) EDI e-invoices that do not comply with EN16931 are no longer allowed, even with the buyer's consent.

The federal Treasury Department has indicated that the phase-out may be extended, depending on developments and feedback from the market.

Currently, the German regulator has left open the question of the transport or exchange mechanism for e-invoices. This means that in theory, even email can be used for this purpose (although this option is insecure and manual). At the same time, we see the Peppol network gaining momentum in Germany on both the B2G and B2B sides, so our recommendation to companies would be to consider the Peppol network as the framework for issuing, exchanging and receiving of e-invoices for their operations in Germany.