E-invoicing: Digitization in accounting

E-invoice

From 01.01.2025, e-invoicing will be introduced. But who is affected by the e-invoicing obligation, and what steps can companies and the self-employed take now to prepare for it? Here you will find an overview of the most important information:

What is an e-invoice?

An e-invoice is a digital document that is intended to gradually replace classic paper and PDF invoices. All information, such as account data, tax number or invoice amount, can be machine-readable in an e-bill. This allows the recipient’s accounting software to process this data automatically. The aim is to save time and money, simplify the exchange with the tax offices and minimise errors, for example due to the manual entry of IBANs.

Illustration of the introduction of e-invoices, showing the transition from traditional paper invoices to digital solutions in the modern office, including symbols for XML, data transfer and accounting software.

Creation of an e-invoice

How is an e-invoice created?

The easiest way to do this is with accounting or invoicing software. The software automatically converts the entered invoice data into a machine-readable XML file. This file can then be sent to customers by email or via Peppol, a digital network for the exchange of e-invoices.

If you want to send a human-readable version in addition to the XML file, you can use the ZUGFeRD file format. This option creates a PDF version in parallel to the XML file.

E-invoicing obligation from 01.01.2025

Who will have to switch to e-invoices from 01.01.2025?

The obligation to use e-invoicing initially affects the B2B sector within Germany. This means that self-employed persons and companies based in Germany must use e-invoices when billing services to other companies or self-employed persons based in Germany. Invoices to private customers or companies abroad are exempt from this regulation.

For low-value invoices of up to 250 euros, a paper or PDF invoice is still sufficient.

Do companies have to accept e-invoices?

Yes, from 01.01.2025, companies and self-employed persons in Germany will be obliged to receive, process and archive e-invoices in accordance with the legal requirements – even if they do not issue e-invoices themselves. This obligation becomes particularly relevant if, for example, suppliers send e-invoices. Accounting or invoicing software can help to efficiently meet the requirements around the receipt and processing of e-invoices.

Is there a transitional regulation?

Yes, a transitional regulation is planned. Until the end of 2026, companies in the domestic B2B sector may continue to use paper or PDF invoices, provided that the invoice recipient agrees.

For companies that achieve a turnover of no more than EUR 800,000 in 2026, this deadline will be extended until the end of 2027. However, from 01.01.2028, all companies in the German B2B sector will be obliged to issue, receive and archive e-invoices.

The legal obligation to retain invoices remains unchanged: invoices, whether in paper or digital form, must continue to be stored for 10 years.