E-Invoicing for Small Businesses in Germany: What You Need to Know
Germany's e-invoicing mandate applies to B2B transactions between businesses established in Germany. Even small businesses and freelancers that have never dealt with structured XML invoices before will need to send them for most domestic B2B sales by their relevant deadline.
Who is affected
The mandate covers all businesses established in Germany for domestic B2B transactions. This includes VAT-registered businesses and also businesses using the Kleinunternehmerregelung (small business rule, Section 19 UStG), since the mandate relates to turnover, not VAT liability. Business-to-consumer (B2C) invoices are not affected.
The key deadlines
- 1 January 2025: all German businesses must be able to receive structured e-invoices.
- 1 January 2027: businesses with turnover above EUR 800,000 in the previous calendar year must send structured e-invoices for domestic B2B transactions.
- 1 January 2028: all remaining German businesses must send structured e-invoices for domestic B2B transactions.
- Transitional use of PDF and paper invoices (with the recipient's agreement) is permitted until the relevant sending deadline.
What a structured e-invoice means
A structured e-invoice is a machine-readable file. The two accepted formats in Germany are XRechnung (a pure XML file, mandatory for public sector invoicing) and ZUGFeRD 2.x (a hybrid format embedding XML within a PDF). A plain PDF invoice, however professional it looks, is not a structured e-invoice under the mandate.
What a small business needs to do in practice
- By January 2025: set up a way to receive structured e-invoices. At minimum, an email inbox monitored for XML attachments satisfies the receiving requirement.
- Before your sending deadline: use a tool or service that can generate XRechnung or ZUGFeRD-compliant output from your invoice data.
- Archiving: structured e-invoices must be archived for 10 years in a way that keeps them readable and unaltered.
A practical first step
Check whether your current accounting or invoicing software already supports ZUGFeRD or XRechnung export. Many tools have added this functionality. Switching to one that does before your sending deadline is simpler than a rushed migration closer to the date.
This article is general information only and does not constitute tax or legal advice. Consult a Steuerberater or qualified adviser for guidance on your specific situation. E-Rechnung helps you create compliant structured e-invoices. For a comparison of the two main formats, see the article on XRechnung vs ZUGFeRD.
Common questions
- Do freelancers in Germany have to send e-invoices?
- Yes. The mandate covers all businesses established in Germany for domestic B2B transactions, including Freiberufler and Gewerbetreibende. The deadline depends on annual turnover.
- Does the Kleinunternehmerregelung exempt a business from e-invoicing?
- No. Businesses under the small business rule still fall under the mandate. They cannot charge VAT, but they still need to send structured e-invoices for B2B transactions by the relevant deadline.
- Can I still send PDF invoices after 2025?
- To other businesses (B2B), PDF invoices are permitted during the transitional period (until 2027 or 2028 depending on turnover) with the recipient's agreement. After the relevant deadline, structured e-invoices are required. Consumer invoices (B2C) are not affected.
- What counts as a structured e-invoice in Germany?
- An XRechnung file (pure XML, required for public sector) or a ZUGFeRD 2.x file (hybrid PDF and XML). A plain PDF is not considered a structured e-invoice under the mandate, regardless of how it looks.