Germany's E-Invoicing Mandate: What Businesses Must Change by 2028

What does the e-invoicing mandate mean for your business?

For many owners, the e-invoice is an accounting topic that the tax advisor will sort out at some point. That falls short. The invoice is the last step in a chain that starts in sales: with the quote, the order, the customer's purchase order number, the agreed prices. If these data are incomplete or scattered, it is not the software that fails but the process.

At the same time, the mandate is an occasion to look at the entire path from order to payment. If you have to switch anyway, you can get rid of retyping, follow-up questions, and media breaks along the way. So the question is: what does the e-invoicing mandate require of your business, and how do you switch so that your workflow benefits as well? To answer it, we first clarify deadlines, definition, and exceptions, then ask why governments are introducing e-invoicing and what it has to do with your sales, and end with a five-stage roadmap.

Which deadlines apply to receiving and issuing?

The legal basis is the Growth Opportunities Act (Wachstumschancengesetz) of March 2024. It amended the German VAT Act so that invoices between domestic businesses must gradually be issued as e-invoices. The obligation only applies to supplies to other businesses in Germany, meaning B2B. Invoices to consumers are not affected.

There was no transition period for receiving. This is the point many businesses underestimate: even if you only have to switch in 2028, you are already receiving e-invoices from suppliers today and must be able to process and store them.

What counts as an e-invoice and what does not?

An e-invoice within the meaning of the law is an invoice in a structured electronic format that can be read by machines and complies with the European standard EN 16931. In its letter of October 15, 2024, the Federal Ministry of Finance lists XRechnung and ZUGFeRD from version 2.0.1 as permitted formats. With ZUGFeRD, a PDF file contains an embedded machine-readable data set, so people and software read the same invoice.

Important in practice: according to the Federal Ministry of Finance, all mandatory VAT details must be contained in the structured data set. For formats with a visible PDF part, the data set is what counts, not the image. The tax authorities offer a function in the ELSTER portal that displays structured invoices in readable form. The law does not prescribe how the invoice is transmitted, whether by email, through an interface, or via a portal. The business partners agree on that.

Which exceptions apply?

Not every invoice has to be an e-invoice. Referring to the Federal Ministry of Finance, the Chambers of Industry and Commerce list these exceptions, among others:

• Small-amount invoices of currently up to 250 euros gross. If an invoice covers several supplies, the total amount counts, according to the ministry's letter of October 2025.
• Travel tickets, such as train or bus tickets.
• Invoices to consumers, because the obligation only applies to supplies to businesses.
• Certain VAT-exempt supplies, for example under Section 4 nos. 8 to 29 of the German VAT Act.
• Small businesses under Section 19 of the German VAT Act do not have to issue e-invoices. They must still be able to receive them.

Invoices to customers abroad do not fall under the domestic obligation either. Other countries have their own rules, however. If you export, keep this in mind, as the article Exports and sales explains.

Why are governments introducing e-invoicing at all?

For the state, it is mainly about VAT. Structured invoice data make audits easier and fraud harder. Italy, which comprehensively introduced e-invoicing between businesses in 2019, shows how large this effect can be.

Heinemann and Stiller (2025) compared trade data reported separately by importing and exporting countries. The gap between the two reports is considered an indicator of cross-border VAT fraud. After e-invoicing was introduced, it shrank markedly. For businesses, the benefit is a different one: less retyping, fewer errors, and faster approvals. That does not happen by itself, though.

E-invoicing is an obligation for tax purposes and an opportunity for your processes. If you only meet the obligation, you give away the opportunity.

What does e-invoicing have to do with your sales team?

An e-invoice is only as good as the data it is built from. And many of those data originate in sales. Customer name and address, the contact in accounts payable, the purchase order number, agreed prices, and payment terms often end up in emails, notes, or the salesperson's head. With a paper invoice, accounting caught gaps by asking around. With a structured invoice that the customer processes automatically, every gap shows up immediately: the invoice is rejected or gets stuck in review, and the money arrives later.

In this example, 16 days pass before the payment term even starts running. Most of them arise not in accounting but because a detail from sales was missing. The guide Optimizing order processing describes which details must be recorded when a quote becomes an order. How to set rules for clean customer data that the team actually follows is shown in Data quality in your CRM.

Research on adoption in small businesses confirms that fit is what matters. Le (2025) surveyed 152 owners and managers of small and mid-sized companies in Vietnam, where e-invoicing has been mandatory since July 2022. The strongest influence on willingness to adopt was how well the solution fit actual invoicing workflows. The study measures intentions rather than actual adoption, and Vietnam is only partly comparable with Germany. The finding matches a case study by Naghshineh and colleagues (2026) at the tool manufacturer Hilti, however: the biggest implementation hurdles they identified were a lack of process transparency, redundant steps, unclear communication, and too little automation.

The five-stage roadmap: how to make the switch

I recommend not starting the switch by choosing software but by looking at the process. This applies to e-invoicing just as it does to any other digitalization project, as the article Why process comes before tools explains. The roadmap has five stages.

1. Stage 1: Secure the inbox

   Decide where e-invoices arrive, for example a dedicated mailbox, who reads them, and how you can display the data set. Clarify with your tax advisor how to store them in their original format.

2. Stage 2: Clarify outgoing invoices

   Check whether your 2026 turnover exceeded 800,000 euros, which would mean issuing e-invoices from 2027. Ask your software provider which formats your system can produce.

3. Stage 3: Clean up master data

   Go through the data of your active business customers: company name, address, VAT identification number, invoice recipient, purchase order numbers, and preferred format.

4. Stage 4: Connect quote and order

   Make sure every detail that belongs on the invoice is captured in the quote and the order confirmation, in one place and not in emails.

5. Stage 5: Test and switch

   Start with two or three customers who explicitly want e-invoices. Collect feedback and then roll out the switch more widely.

If you run many tools side by side, look closely at stage 4 to see where data are maintained twice. The guide Reducing tool sprawl offers pointers.

How to get started

The mandate arrives in stages, and most steps mainly require clear responsibility. Start with what already applies: receiving.

• Check whether e-invoices have arrived in recent weeks and clarify who read them and how they were filed.
• Name one person responsible for the switch who talks to the tax advisor and the software provider.
• Clarify your 2026 total turnover with your tax advisor to know whether the issuing obligation starts in 2027 or 2028.
• Ask your software provider in writing whether XRechnung and ZUGFeRD from version 2.0.1 can be produced and imported.
• Check your ten largest business customers for complete invoicing data and ask for missing details.
• Make it a rule in sales that the purchase order number and invoice recipient are recorded for every order.

At the start we asked what the e-invoicing mandate requires of your business and how to make the switch sensibly. Receiving has applied to all domestic companies since 2025; issuing to business customers follows in 2027 or 2028, depending on prior-year revenue, and a PDF sent by email is not enough for it. The switch is most likely to succeed as a process project, because the software only writes into the invoice the data that the quote and order have captured cleanly beforehand.