Mandatory E-Invoicing from 2025 Affects All Businesses

The mandatory e-invoicing requirement for receiving invoices has applied without exception to every domestic company since January 1, 2025. Anyone receiving B2B invoices must be able to accept and process structured datasets like XRechnung or ZUGFeRD – a simple PDF is no longer legally sufficient. For sending invoices, staggered deadlines apply until 2028, depending on the previous year's revenue. Viewing this transition merely as an IT project for the tax office misses the real leverage: structured invoicing marks the end of manual data entry in accounting.

Why the mandatory e-invoicing for receiving knows no exceptions

Since January 1, 2025, every German company must be able to receive electronic invoices in a structured format. The Federal Ministry of Finance makes no exceptions here, not even for small business owners or companies not entitled to deduct input tax. The basis is the Growth Opportunities Act, which redefines § 14 UStG. According to this, an e-invoice is now only a dataset that complies with the European standard EN 16931 and enables electronic processing. A pure PDF document is no longer considered an electronic invoice under tax law, but rather an other invoice. Technically, a simple email inbox is sufficient for mere receipt. However, the real challenge lies in the readability and archiving of the XML data. Anyone who prints these datasets or stores them only as illegible code violates retention requirements.

When companies must send e-invoices themselves

The obligation to send e-invoices takes effect in stages and initially affects high-revenue businesses from January 1, 2027. Anyone generating a taxable total revenue of more than 800,000 euros in 2026 must mandatorily issue standard-compliant e-invoices for domestic B2B transactions starting in 2027. This is regulated by § 27 Para. 38 UStG. Until the end of 2026, all companies may still send PDFs or paper invoices, provided the recipient agrees. From January 1, 2028, the sending obligation will apply to all B2B transactions, regardless of revenue. Small-value invoices up to 250 euros gross, travel tickets, and B2C invoices to private individuals remain permanently exempt. Certain tax-exempt transactions, such as medical treatments, also do not fall under the obligation. Those who previously used the EDI procedure may continue to do so beyond 2028, provided a correct reporting dataset according to the UStG can be extracted from the EDI invoice.

Which formats are permitted and where the traps lie

Only formats that enable a complete and correct extraction of the required data according to Directive 2014/55/EU are permitted. The best-known standards in Germany are XRechnung and ZUGFeRD. The XRechnung is a pure XML dataset that is hardly readable to the human eye without aids. ZUGFeRD, on the other hand, is a hybrid format: it combines a visible PDF with an embedded XML file. However, this is a common source of error: the ZUGFeRD profiles MINIMUM and BASIC-WL are not permitted under tax law. Only profiles from ZUGFeRD 2.0.1 onwards that map the full scope of the standard are allowed. Anyone updating their billing software must imperatively check which profile is generated during export.

Why the 800,000 euro threshold is often misunderstood

The revenue limit of 800,000 euros for sending e-invoices has nothing to do with the small business regulation. In practice, these thresholds are frequently mixed up. The small business regulation was also adjusted on January 1, 2025: anyone who was under 25,000 euros net in the previous year and does not exceed 100,000 euros in the current year is considered a small business owner. According to § 34a UStDV, these businesses are permanently exempt from the obligation to issue e-invoices themselves. The 800,000 euro limit, on the other hand, merely determines whether a regularly taxable company must switch to electronic sending as early as 2027 or not until 2028. The decisive factor here is the total taxable revenue according to § 19 Para. 2 UStG, not the profit and not just the B2B share.

How systems are taking over document processing now

A modern document and accounting system turns the legal obligation for structured invoices into a measurable efficiency gain. When XRechnungen or ZUGFeRD documents land in the inbox, the system reads the XML data flawlessly and generates a finished booking proposal including accounts, splits, and tax keys without media discontinuity. Hybrid formats or old PDFs are also captured via OCR and AI vision, even if they contain handwritten notes. An orchestrator decides in three stages whether a document runs through automatically, is submitted for review, or must be processed manually. Nothing is waved through blindly. Every confirmed or corrected booking further trains the system, so that the proposal quality per creditor continuously increases. The result is GoBD-compliant, DATEV-compatible accounting that turns the archive into a searchable database. Questions such as the amount of certain back payments can then be answered in seconds – including a source link to the original document.

What managing directors must check now

The first step is to ensure readiness to receive, as this deadline has already passed. Check whether your current invoice receipt inbox can receive structured XML files and whether your accounting software can process them. Then clarify your expected total revenue for 2026 to know whether you must invoice in ZUGFeRD or XRechnung format yourself starting in 2027 or 2028. Anyone who is now merely looking for a tool to convert XML files into readable PDFs is falling short. The transition is the ideal time to automate the entire document processing and abolish manual typing work once and for all.