Germany E-invoicing
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Regulated under the EU Directive 2014/55/EU, requiring e-invoicing in public procurement. National framework E-Rechnung governs specific e-invoicing mandates for federal and state-level transactions.
Germany’s transition to mandatory e-invoicing follows an EU-wide push for digital tax systems:
Implementation of mandatory e-invoicing in Germany
Germany’s transition to mandatory e-invoicing follows an EU-wide push for digital tax systems:
- Since November 2020, B2G e-invoicing is required for all suppliers to federal public authorities. Invoices must be sent in XRechnung or ZUGFeRD format via official portals.
- From January 2025, e-invoicing becomes mandatory for B2B domestic transactions, starting with structured electronic invoices. Paper and unstructured PDFs will no longer be accepted.
Who needs e-invoices in Germany?
E-invoicing in Germany is required for:- Federal Government Suppliers: Required for transactions with federal public entities.
- State-Level Suppliers: Mandatory for suppliers to state-level public entities in participating states.
- B2B Transactions: Encouraged for cross-border transactions within the EU for VAT compliance.
- Non-Resident Businesses: Required for transactions with German public entities if VAT-registered in Germany.
E-Invoicing vs. E-Billing
| Aspect | E-Invoicing | E-Billing |
| Purpose | Compliance with EU and German regulations | Informal and internal transactions |
| Format | XRechnung, PEPPOL BIS Billing 3.0 | Flexible, non-regulated formats |
| Usage | Public procurement, encouraged for B2B | Customer-focused billing and payments |
Key features of Germany’s e-invoicing system
Germany’s e-invoicing system involves:- Submission Platforms: Federal suppliers must use ZRE or OZGRE, while state-level transactions use certified platforms.
- Validation: Ensures compliance with XRechnung or PEPPOL BIS standards.
- Archiving: E-invoices must be stored electronically for 10 years under German tax laws.
E-invoicing dataset
E-invoices in Germany include the following critical data:- Buyer/Seller IDs: VAT identification numbers.
- Invoice Details: Number, date, and payment terms.
- Goods and Services: Descriptions, quantities, unit prices, and subtotals.
- Taxes: Applicable VAT rates and amounts.
- Transaction Info: Total payable amount, currency, and payment method.
- Delivery Info: Date and place of delivery.
E-invoicing across transaction types
B2B Transactions:- Not mandatory but recommended for efficiency and EU crossborder alignment.
- Reduces processing time and ensures VAT compliance.
- Optional, used for streamlining processes and improving customer satisfaction.
- Mandatory for all federal and most state-level public entities. Requires compliance with XRechnung or PEPPOL BIS standards.
Penalties for non-compliance
- Invoice Rejections: Non-compliant invoices may result in delayed payments.
- Fines: Penalties for failing to meet public procurement requirements.
- Operational Delays: Repeated non-compliance may damage reputation and attract increased scrutiny.
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