German e-invoicing obligation: which deadlines really apply and what to do

Key takeaways

• Since 1 January 2025 every domestic company must be able to receive and process B2B e-invoices — with no transition period.
• For sending there is a transition period until the end of 2026: paper and PDF remain allowed with the recipient's consent.
• From 1 January 2027 companies with more than €800,000 prior-year turnover must issue structured e-invoices.
• From 1 January 2028 the issuing obligation applies to essentially all domestic B2B transactions.
• A PDF invoice sent by email is not an e-invoice in the legal sense.

The most common misconception: PDF is not an e-invoice

An e-invoice in the legal sense is a structured data record that can be transmitted electronically and processed automatically. A PDF is a picture of an invoice — readable for humans, not evaluable for software. It explicitly does not meet the requirement, not even when it arrives by email.

This distinction is the core of the whole regulation. The legislator does not want invoices that look digital but invoices that can be processed onwards without manual entry. Once you understand that, you also understand why the receiving obligation came without a transition period: being able to receive and read is the precondition for senders being able to switch at all.

The roadmap step by step

The obligations arrive in two waves. The receiving side has long been in force, the sending side follows staggered by company size:

• Since 1 January 2025 — receiving and processing structured e-invoices is mandatory for all domestic companies
• Until 31 December 2026 — transition period for sending: paper and PDF still permitted if the recipient consents
• From 1 January 2027 — issuing obligation for companies with more than €800,000 prior-year turnover
• From 1 January 2028 — issuing obligation for essentially all domestic B2B transactions

XRechnung or ZUGFeRD?

Two formats have prevailed in Germany. XRechnung is pure XML without a PDF wrapper and is the standard in the public sector. ZUGFeRD is a hybrid: a PDF/A-3 file with the structured XML record embedded in it. The recipient sees a familiar invoice and can still process it automatically.

Both meet the VAT requirements — ZUGFeRD, however, only from version 2.0.1 and not in every profile. The MINIMUM and BASIC-WL profiles are explicitly excluded because they do not represent a complete invoice but merely act as booking aids. Anyone who accidentally sends in one of these profiles is formally not sending a valid invoice.

In practice the recipient base decides. If you deliver a lot to public sector clients, there is no way around XRechnung. If you mostly invoice smaller businesses, ZUGFeRD is often friendlier because the invoice stays readable even without processing software.

Where projects get stuck in practice

Sending is rarely the problem. Most ERP systems can now produce structured invoices; in Business Central the E-Document framework covers XRechnung, Peppol BIS 3 and ZUGFeRD. The receiving side is where the effort lies.

Because receiving is not the same as filing. If you merely drop an XRechnung into the archive as a file and keep entering it manually alongside, you have formally met the obligation and still gained nothing — on the contrary, it is more work than before. The benefit only appears once the structured record is automatically matched to the purchase order, validated and pushed into the approval workflow.

The second stumbling block is archiving. E-invoices must be retained in their original format in an audit-proof way. A printed PDF of the XML file is not enough. Anyone noticing that only after go-live has a retention gap that is hard to close retrospectively.

Frequently asked questions

Does the obligation also apply to small businesses?

The receiving obligation applies regardless of size to all domestic companies — including small businesses under the German small-business rule. For the issuing obligation there are reliefs and exceptions, among others for small-amount invoices. You should clarify your specific situation with your tax adviser.

What about invoices to private customers and abroad?

The rules cover domestic B2B transactions. Invoices to private individuals (B2C) and cross-border transactions are not included. Separate initiatives are in preparation for the EU single market that point in the same direction over time.

How long does the switch take in Business Central?

Setting up document formats and dispatch routes alone is manageable and often done in a few days. The surrounding work takes the time: agreeing formats with key business partners, exchanging test documents, sensibly automating invoice receipt and training accounting. A few weeks is realistic.