Germany’s B2B electronic invoicing law approved
Summary
B2B electronic invoicing rules in Germany were introduced on 1 January 2025. However, a transitional period is currently in place, leveraging what are known as "Übergangsregelungen" (transitional rules).
An electronic invoice (E-Rechnung) must be issued, transmitted, and received in a structured electronic format that allows automatic processing and correct extraction of VAT-relevant data according to EN 16931.
The implementation of Germany’s mandatory B2B e-invoicing follows a phased schedule, distinguishing between the obligation to receive invoices (already active) and the obligation to issue them (future phases).
EDI formats are allowed provided they enable the correct and complete extraction of VAT-relevant data in accordance with the EN 16931 standard (or another interoperable structured format).
Germany has business-to-government (B2G) e-invoicing mandates in place.
The Growth Opportunities Act
On 17 November 2023, the Growth Opportunities Act (Wachstumschancengesetz), including the compulsory Business-to-Business (B2B) electronic invoicing regulation, was approved by the German Bundestag. The Act underwent several amendments compared to the initially submitted version.
In its recent session on 21 February 2024, the German Mediation Council revisited the Growth Opportunities Act. The B2B electronic invoicing mandate remained largely unchanged, with previous timelines remaining valid. Good news arrived on 22 March 2024, when the Bundesrat approved the Growth Opportunities Act with a clear majority.
This final approval solidifies the B2B electronic invoicing mandate, ensuring its implementation in accordance with the previously established timelines.
Germany’s latest VAT and e-invoicing proposals
Current definition of an electronic invoice
Recent legislative decisions have confirmed the definition of an electronic invoice and the classification of paper invoices under the mandatory e-invoicing rules.
Germany’s electronic invoicing rules for B2B transactions have been in effect since 1 January 2025, though a phase-in period utilising so-called “Übergangsregelungen” (transitional rules) allows for the continued use of paper invoices and “non-compliant” electronic invoices (with recipient consent) until 31 December 2026.
Outside of the transitional rules period, an electronic invoice (E-Rechnung) must be issued, transmitted, and received in a structured electronic format that allows automatic processing and correct extraction of VAT-relevant data according to EN 16931 (or another mutually agreed structured format).
Simple PDF documents or paper invoices will no longer qualify as electronic invoices and will instead be classified as “other invoices”.
New mandatory e-invoicing dates and procedures
The following mandatory dates and procedures apply to all business-to-business (B2B) invoicing scenarios:
Since 1 January 2025 - All domestic B2B companies must be able to receive structured e-invoices compliant with EN 16931. Buyer consent is no longer required for sending e-invoices, provided the invoice is issued in a structured format.
Until 31 December 2026 - Paper invoices and e-invoices in formats that do not comply with EN16931 are still allowed, but may only be sent with the consent of the recipient.
From 1 January 2027 - B2B e-invoicing issuance obligation for businesses with a previous year's (2026) turnover of EUR 800,000 or more. Businesses are allowed to continue using EDI.
From 1 January 2028 - B2B e-invoicing issuance obligation for all businesses. EDI is still permitted, provided that the VAT information can be extracted in EN16931.
The status of EDI
The status of EDI has been clarified: EDI remains permitted for B2B electronic invoicing as long as the chosen format enables the correct and complete extraction of VAT-relevant data in line with EN 16931 (or another mutually agreed structured format). No further legislative vote is required.
Germany’s e-invoicing history
Germany, like many European Member States, currently has business-to-government (B2G) e-invoicing mandates in place. All public bodies must be able to receive electronic invoices, and all public body suppliers must send electronic invoices to their government contractor.
The first inclination of Germany’s intentions to mandate B2B electronic invoicing was on the 23rd of June 2023, when the European Commission gave the country permission to move away from certain parts of the European VAT directive.
Germany’s plan aligns with the VAT in the Digital Age directive, which is also persuading many European Member States to address their e-invoicing regulation intentions.
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