Germany: B2B Electronic Invoicing

An Overview of E-invoicing in Germany

As Germany starts considering e-invoicing between businesses within the republic, the government coalition has requested repealing Articles 218 and 232 of the European Directive on Electronic Invoicing from the European Union in December 2022. Both these articles specify that companies must first obtain permission from their suppliers before adopting electronic invoicing. Revoking these regulations would create a starting block to implementing B2B invoicing effectively. 

Implementing B2B invoicing in Germany

On 17 April 2023, an initial plan was launched by the German Federal Ministry of Finance regarding the introduction of B2B invoicing. Some of the core takeaways from the proposal included a phased implementation approach and an anticipated implementation date of January 2025. In addition, the draft published by the Federal Ministry of Finance highlighted the following points: 

• Limiting electronic invoicing to domestic B2B transactions.
• Defining electronic invoicing based on CEN 16931.
• Eliminating paper invoices.

In the interim, several implementation models are being evaluated. The two significant implementation models currently under evaluation are as follows: 

Model 1: Also known as the 5-corner model via Peppol. This model will require companies to have their own Peppol Access Point, allowing them to exchange electronic documents. The Peppol Access Point then sends the documents to a national platform as well as serve as an exchange point between the access points of each company. This Peppol model is currently the most widely preferred model, which is why VAT IT qualifies as a certified Peppol Access Point provider. 

Model 2: This model follows a similar approach to the model implemented in France. It uses a certified private platform to exchange electronic invoices. Within this model, a centralized government platform will receive all documents. However, they must be validated before their submission. Document exchange between companies will also occur via these platform service providers instead of the centralized government platform. 

Ultimately, The German government's proposal would align with the European proposal for VAT in the Digital Age (ViDA), using the European standard for electronic invoicing EN 16931. There currently needs to be confirmation from the government on whether or not mandatory B2B invoicing will be introduced. Considering the decentralized invoicing system across each of its federal states, imposing a compulsory unified B2B invoicing system would be challenging. 

Manage your invoices for maximum recovery with VAT IT

Invoices form the crux of the entire VAT recovery process, so it’s critical to stay in the loop with changing legislation, processes, and invoicing instructions. However, without the right tool, this task can be resource-intensive, time-consuming, and prone to error. 

Rather, rest assured that all your invoices are eligible for VAT recovery and that they comply with the latest VAT treatment before submitting your returns. Tag VAT IT into your corner, where we combine human expertise with digital accuracy, so you can assess and review all your VAT-recoverable invoices on auto-pilot. 

If you have any questions regarding e-invoicing, reach out to our dedicated e-invoicing solutions department who can help you administer the entire process.