- Mandatory E-Invoicing Introduction: Germany will mandate e-invoicing for B2B transactions starting 1 January 2025. There will be a transitional period where businesses must adapt their invoicing systems, with full compliance required by 2028.
- Transitional Period:
- From 1 January 2025, all businesses must be able to receive electronic invoices.
- Businesses can issue paper invoices or PDFs until 31 December 2026.
- From 1 January 2027, businesses with annual turnover above €800,000 must issue e-invoices.
- Paper invoices are allowed until 31 December 2027 for SMEs with turnover not exceeding €800,000.
- From 1 January 2028, all businesses, regardless of turnover, must issue e-invoices.
- Implementation Details: The BMF Draft Letter dated 14 June 2024 outlines the implementation stages, acceptable formats, and compliance requirements. E-invoices can be transmitted via email, electronic interfaces, or download portals. Input VAT deduction can be exercised with proper e-invoice documentation and corrections.
- Specific Regulations:
- The €800,000 turnover limit applies regardless of the taxation method (estimated or actual).
- For VAT groups, the entire group’s turnover is considered.
- Credit note issuers’ total turnover is taken into account.
- Third-party issued invoices consider the client’s total turnover.
- Small invoices under €250 can be issued as standard invoices without e-invoice requirements.
- Support and Clarifications:
- The Federal Government plans to support companies with the new requirements and publish a final BMF letter and FAQs before the regulations take effect.
- Receiving e-invoices requires only an email mailbox unless otherwise agreed.
- No free government tool for creating and visualizing e-invoices will be provided, as private providers already offer such services, some for free.
Source Taxbackinternational
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