For those in a hurry
- Receiving e-invoices from 2025: Starting in January 2025, companies in the B2B sector, as well as those working with public clients in Germany, must be able to receive and process e-invoices to ensure their input tax deduction.
- Technical requirements made easy: Companies need at least an email inbox to receive e-invoices and a software solution to meet the requirements of the Federal Ministry of Finance, as well as to ensure automated processing and archiving.
- Preparation pays off: An early transition to e-invoice systems prevents media disruptions, enables seamless integration into existing systems, and ensures GoBD-compliant archiving of invoices.
- Increasing efficiency and sustainability: E-invoices automate processes, minimize sources of error, and save time, which increases efficiency and conserves resources, thereby reducing environmental impact.
The obligation to create and receive electronic invoices (e-invoices) in a structured format comes into effect in 2025 and represents a significant change in accounting for companies. Invoice recipients, in particular, must prepare for these changes in good time to adapt their processes to legal requirements and avoid disadvantages regarding input tax deduction. In our article, you will learn what you need to pay attention to.
Obligation to receive e-invoices
From January 1, 2025, all entrepreneurs in Germany are required to receive and process e-invoices. This obligation applies to companies of all sizes, including small businesses. Refusal is not possible if the invoice issuer wishes to transmit an e-invoice. Companies must therefore prepare for electronic invoicing and ensure they can receive and process them.
The introduction of the e-invoice is part of the Growth Opportunities Act (Wachstumschancengesetz) and primarily affects invoices in the B2B sector. Electronic invoices are transmitted in standardized, structured formats such as the ZUGFeRD format or as an XRechnung, which must comply with the European standard EN 16931. These formats enable automated processing of invoice data and simplify the entire invoicing process. You can find more information on electronic invoice formats in this blog post.
Minimum requirements for receiving
The Federal Ministry of Finance (BMF) has deliberately kept the technical requirements for receiving e-invoices low to make the transition easier for companies until 2028. In principle, an email inbox is sufficient to receive electronic invoices. The e-invoice can then be transmitted in formats such as XRechnung or ZUGFeRD.
Nevertheless, companies should ensure that the received e-invoices are not only correctly received but can also be further processed and archived in an audit-proof manner. For smooth integration into accounting or ERP systems, it is recommended to automatically transfer invoice data into existing systems to avoid media disruptions. Audit-proof archiving of electronic invoices is mandatory to comply with the legal requirements of the GoBD (Principles for the proper management and storage of books, records, and documents in electronic form).
With our cloud-based e-invoicing software, you can create and receive e-invoices effortlessly and without system adjustments. Experience GoBD-compliant archiving, automatic processing, and cost efficiency all in one. Book a free demo and learn how our solution can simplify your processes!
Must all companies receive e-invoices?
In Germany, all companies must generally be able to receive e-invoices if they do business with public clients and thus issue invoices to authorities. This obligation for e-invoicing and receipt stems from the implementation of EU Directive 2014/55/EU. The regulations aim to digitize the exchange of invoices between companies and public administration, increase efficiency, and reduce administrative costs.
Overview of regulations and obligations
Public clients: Since November 27, 2020, all federal authorities and institutions have been required to receive and process e-invoices. This means that companies that have a business relationship with the federal government must submit electronic invoices via the federal portal (ZRE or OZG-RE).
Companies as suppliers to public clients: Companies working for public clients must submit invoices in a prescribed format (e.g., XRechnung or ZUGFeRD 2.1.1). These formats are structured and machine-readable, which enables automated processing.
Private companies without business relationships with the public sector: For companies that exclusively conduct private-sector business, there is currently no legal obligation to receive or send e-invoices. However, digital invoicing is increasingly becoming the norm, as many companies want to leverage the efficiency advantages.
The obligation to receive e-invoices applies primarily to companies that issue invoices to the federal government and other public clients. Private companies are not (yet) legally required to receive these invoices.
Input tax deduction only with e-invoices
Starting in 2025, input tax deduction will only be possible with an e-invoice. Invoices in paper form or as PDFs without a structured format will no longer be permitted from this point on. This means that for input tax deduction, you will require an electronic invoice in a valid, structured format.
Entrepreneurs should therefore talk to their suppliers early on about when they will switch to e-invoices and ensure that they themselves are able to receive them. Companies that continue to rely on paper invoices or unstructured PDFs risk losing their input tax deduction.
E-invoice obligation: How to prepare
Even though the introduction of the e-invoice obligation only takes effect in 2025, companies should start preparing now to ensure a smooth transition. The following steps are essential:
- Set up an email inbox to receive e-invoices and inform your suppliers early on.
- Ask your software provider about any updates or extensions to support new formats like XRechnung or ZUGFeRD.
- Ensure that your accounting or ERP software supports the import and processing of data in a structured electronic format.
- Furthermore, your solution should enable audit-proof archiving that fully meets the requirements of the GoBD.
- Train your employees in handling electronic invoicing and the correct processing of invoice data.
By taking these measures, you can optimally utilize the advantages of digitalization while simultaneously fulfilling the legal requirements of the e-invoice obligation starting in 2025.
Advantages of the e-invoice
Even if the introduction of the e-invoice initially means a transition for many companies, it offers significant advantages. The standardized transmission of invoice data enables automated processing, reduces sources of error, and accelerates the entire process. Furthermore, digital invoicing processes contribute to the reduction of paper invoices, which not only saves time and costs but also protects the environment. Media disruptions are avoided, and data can be automatically transferred into accounting or ERP systems.
What deadlines apply to the e-invoice obligation?
The e-invoice obligation has applied to public contracts in Germany since November 27, 2020. Companies that enter into contracts with the public sector must submit invoices electronically. From 2025, the e-invoice obligation will be extended to all companies, regardless of size or order volume. This means that small and medium-sized enterprises (SMEs) are also required to issue their invoices electronically.
The transition periods for the full implementation of the e-invoice obligation can vary depending on company size and order volume. Smaller companies often have longer periods to adapt. We have compiled further information on the specific transition periods for you in this article.
Conclusion
Starting in 2025, all entrepreneurs in Germany must be able to receive and process e-invoices. While the transition brings some challenges, it also offers great opportunities through the digitalization of invoicing processes. Those who prepare for the e-invoice obligation in good time will benefit from more efficient invoice processing, lower costs, and secure input tax deduction. Paper invoices will soon be a thing of the past – so start your transition to the electronic form of invoicing early.
Frequently Asked Questions
What is an e-invoice and how is it received?
An e-invoice is an electronic invoice that is transmitted and received in a standardized format. Companies must be able to receive and process these invoices electronically to meet the requirements of the e-invoice obligation.
What are the most important requirements for invoicing?
When invoicing, the required information such as the invoice issuer, the invoice date, and the VAT ID must be included. This information is important to make the e-invoice legally valid.
How are e-invoices archived?
The storage of electronic invoices must be carried out in accordance with the GoBD (Principles of Proper Accounting). They must be archived in a structured format to facilitate machine processing.
Can paper invoices also be processed as e-invoices?
Yes, scanned paper invoices or PDFs can be processed as e-invoices, but this is not optimal for machine processing. It is recommended to issue e-invoices in a structured format.
What is XRechnung and how does it differ from other e-invoice formats?
XRechnung is a specific format for electronic invoicing in the public sector in Germany. It meets the requirements of the Value Added Tax Act and is mandatory for the electronic transmission of invoices to public clients.
What does the term "media disruption" mean in the context of e-invoices?
Media disruption refers to the switch between different media, for example, from paper to electronic invoices. To fully utilize the advantages of the e-invoice, this media disruption should be avoided.
