Germany Implements Comprehensive eInvoicing Legislation

- July 22, 2024, Ratingen, Germany -

Germany Implements Comprehensive eInvoicing LegislationGermany has made significant strides in the adoption and implementation of electronic invoicing (eInvoicing) through a series of legislative measures and technological advancements. The journey began with the e-Bill law in April 2017, which mandated the reception and processing of eInvoices for all federal contracting authorities. This requirement was further solidified by the Regulation on eInvoicing from September 2017, which set specific implementation dates for various levels of federal authorities.

Key Legislative Milestones

• 27 November 2018: Top federal state authorities were required to receive and process eInvoices.
• 27 November 2019: The mandate extended to all subordinate institutions and sectorial contracting authorities at the federal level.
• 27 November 2020: Issuing and processing eInvoices became mandatory for all federal public contracting authorities.

The legislation mandates the use of the XRechnung format for eInvoices, ensuring a standardized approach across federal authorities and the state of Bremen. Additionally, the Act to Strengthen Growth Opportunities, Investment and Innovation as well as Tax Simplification and Tax Fairness (Growth Opportunities Act), issued on 23 March 2024, established that eInvoicing would become the default method for issuing invoices in Germany starting 1 January 2025. However, full compliance will be phased in, with paper invoices still permitted under certain conditions until 2028.

Implementation Timeline

• 1 January 2025: eInvoicing becomes the default method, but not mandatory for all.
• 1 January 2027: Businesses with a turnover above EUR 800,000 must issue eInvoices.
• 1 January 2028: Mandatory eInvoicing extends to all remaining businesses.

eInvoicing Platforms and Solutions

Germany has developed various eInvoicing platforms to facilitate the transition. The Federal Central Invoice Receiving Platform (ZRE) supports federal administrations, while the OZG-RE platform caters to suppliers. Additionally, the Peppol network is utilized for automated data exchange, ensuring compliance with the XRechnung format and facilitating international transactions.

Decentralized Approach and State-Level Implementation

The implementation of eInvoicing varies at the state level, with each federated state deciding on its own platform and standards. Some states use the central government's platform, while others have developed local solutions. The National IT Planning Council has mandated the use of XRechnung and Peppol for public authorities, ensuring a cohesive approach across different levels of government.

Future Prospects

Germany's eInvoicing landscape is set to evolve further, with potential changes to the definition of electronic invoices to align with the European standard EN 16931. The German eInvoicing Forum (FeRD) continues to play a crucial role in promoting eInvoicing practices across public and private sectors. In summary, Germany's comprehensive eInvoicing legislation and infrastructure aim to streamline invoicing processes, enhance transparency, and combat VAT fraud, positioning the country as a leader in digital financial practices within the European Union.

For more details, visit the EU's eInvoicing in Germany page.