E-Invoicing in Germany

In its Coalition Agreement from 24.11.2021, the German governing Coalition announced its intention to take measures to reduce VAT fraud in the coming years. The plan included the implementation of an electronic reporting system to be used for the creation, verification and forwarding of B2B e-invoices. This new system is to be introduced by 2025. B2G invoicing applies in Germany since 2020.

The Federal Administration notes some of the following criteria for e-invoicing in Germany:

The legal background to electronic invoicing in Germany is the so-called E‑Invoicing Ordinance (“E-RechV”).
The regulation stipulates the requirements for the invoice data model, which must always comply with the “XRechnung” data exchange standard, or another standard that conforms to the European standard EN 16931. The XRechnung is an .XML-based semantic data model.

The “XRechnung” standard should always be used for issuing e-invoices.
In addition, any other standard can be used if it meets the requirements of the European Standard for electronic invoicing (EN 16931), the German “E-RechV” and the terms of use of the Federal invoice receipt platforms.

A PDF file is not an e-invoice.
An e-invoice within the meaning of the EU Directive 2014/55/EU and E-RechV is an invoice that is issued, transmitted and received in a structured electronic format, which allows automatic and electronic processing. An image file, a PDF or a scanned paper invoice therefore does not meet these legal requirements.

An e-invoice allows seamless invoice processing
An e-invoice sent to the Federal Government will be processed completely electronically, from the generation of the invoice to the processing of the invoice to the final payment and archiving. In this way, there is no need for manual entry.

Direct and indirect Institutions of the Federal Administration already receive e-invoices via central invoice receipt platforms.
These platforms have 3 main functions:

The receipt of e-invoices from various submission channels
The technical review of e-invoices (e.g. a review of content, attachments, anti-virus check)
The transmission of the invoices to the intended invoice recipient.
A discussion draft for the introduction of mandatory B2B e-invoicing in Germany is expected to be released by the Federal Ministry of Finance in the next few weeks.