Navigating the e-Invoicing Sea: A Focus on Germany's Regulatory Tide

In the dynamic realm of finance, the surge of e-invoicing mandates is poised to make waves in the coming years, with Germany as one of the pioneer countries. Let’s dive into the waters of compliance and explore what this means for finance professionals.

The Global E-Invoicing Surge

The global shift towards e-invoicing and tax requirements continues to gain momentum, turning into a tidal wave set to hit in 2024 and beyond. Governments worldwide are imposing regulations, compelling companies to transition to true electronic invoicing and ensure VAT compliance. This heralds not only a new era of operational shifts but also introduces fresh technology challenges for many businesses.

According to Marcus Laube, CEO of Billentis, working on their next global e-Invoicing and tax compliance report, "It's a tornado coming up with challenges for companies and service providers." The unpredictable nature of mandate effective dates adds another layer of complexity, sometimes delayed, providing more prep time, and other times accelerated, demanding rapid adjustments. These changes can be disruptive, costly, and divert attention from other strategic priorities unless a company is ready to be an early adopter.

Proactive Preparation: The Key to Success

Our advice? Take a global view of e-invoicing mandates early on. Identify the countries impacting your business and create a strategic timeline. Collaborating with us allows your company to achieve foundational preparedness well in advance, eliminating pressure and rush. When the time comes, we can seamlessly "switch on" mandate-compliant e-invoicing, conserving both time and human resources.

Navigating Germany’s Regulatory Changes

The German Ministry of Finance initially proposed an e-invoicing mandate for B2B transactions, aligning with the European Commission's ViDA framework. Originally set for 2026, recent legislative amendments have accelerated the timeline.

  • As of the beginning of 2025, every company must be capable of receiving e-invoices compliant with the EN16931 (e.g., XRechnung).
  • Suppliers may issue an EN-compliant e-invoice (including EN-compliant EDI) and send it to any buyer without asking for their prior consent.
  • The use (issuance and exchange) of invoices in unstructured formats and non-EN-compliant EDI e-invoices is allowed only subject to the buyer’s prior consent.

For early adopters, this is an opportunity to seamlessly transition to sending only e-invoices and eventually reducing resources from accounts receivable (AR). However, the accounts payable (AP) scene remains nuanced, as handling various formats is still a reality.

Other noteworthy points for Germany include:

  • Starting January 2027, companies with over €800K turnover must exclusively send e-invoices. Smaller companies can continue sending paper or PDF invoices until January 2028. Then, all companies must send only B2B e-invoices.

GERMANY - Government Draft on the Growth Opportunities Act 

Overview of the Transitional Arrangements 

Sending Method 

2025 

2026 

2027 

2028 

Paper 

Transitionally Permitted 

Transitionally Permitted 

 Permitted with Conditions 

Not Allowed 

e-Invoice (EN16931) 

Allowed 

Allowed 

Allowed 

Allowed 

Other Electronic Formats 

 Permitted with Conditions 

 Permitted with Conditions 

 Permitted with Conditions 

 Permitted with Conditions 

EDI 

Transitionally Permitted 

Transitionally Permitted 

Transitionally Permitted 

 Permitted with Conditions 

Reception 2025: Beginning January 1, 2025, every company must be able to receive e-invoices! 

This phased approach, typical in many mandates, reflects the complexities involved in aligning different opinions, needs, and situations.

The Path Forward

As the mandatory implementation of e-invoicing in Germany demonstrates, staying ahead is not just a virtue but a necessity. The shifting landscape of e-invoicing mandates demands a strategic approach. By understanding the global picture and adopting a phased, proactive stance, finance professionals can navigate the sea of regulatory change with confidence.

Germany's journey is a testament to the dynamic nature of these mandates. As we ride the waves of change, let’s stay ahead, anticipate shifts, and ensure our financial sails are set for success.

Speak with Basware Compliance Experts

Ensuring global regulatory compliance with worldwide invoicing and tax mandates is a central business challenge for organizations operating in multiple geographies. To ensure compliance, you need a seasoned partner by your side who has a deep understanding of the constantly changing e-invoicing environment. With innovative solutions that ensure e-invoicing compliance in over 60 countries, Basware is that partner. Visit our interactive compliance map to stay up-to-date on this topic or contact us to speak with a compliance expert.

Director, Product Management Martin has over 10 years experience in e-invoicing, e-archiving and product complaince domain. He has delivered and produced services to help customers gaining efficiencies and visibilities into their procure-to-pay (P2P) and order-to-cash (O2C) processes. Martin currently is leading Basware's Network Sending and Country Expansions team in Product Management.

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