E-invoicing Obligation from 2025: BMF Specifies Requirements
In previous blog posts, we have already provided an overview of the planned introduction of the obligation to issue invoices electronically (e-invoicing). Now, on October 15, 2024, the Federal Ministry of Finance (BMF) published an official letter. This letter clarifies many previously unanswered questions and specifies the requirements for mandatory e-invoicing from 2025.
Key Aspects of the E-invoicing Obligation
The BMF letter reconfirms the core aspects of the new regulations. Starting January 1, 2025, invoices for transactions between domestic entrepreneurs (B2B) must generally be issued, transmitted, and received as electronic invoices (e-invoices) in a structured format.
Exceptions to this rule are limited to:
- Certain tax-free transactions.
- Small-value invoices up to EUR 250.
- Tickets.
The obligation applies irrespective of a company's size or whether it is a startup. Therefore, even small entrepreneurs must issue e-invoices if they make deliveries to other entrepreneurs.
Permitted Formats and Transmission Channels for E-Invoices
The BMF letter outlines the permitted formats for e-invoices. These primarily include the XRechnung and ZUGFeRD 2.0 standards (from version 2.0.1). However, other formats compliant with the European standard EN 16931 are also acceptable.
Under specific conditions, parties can even agree on individual formats for e-invoice exchange. Various methods are available for transmitting e-invoices, such as email, provision via dedicated portals, or data exchange through an interface.
Recipients must ensure the proper receipt of e-invoices from 2025 onwards. A standard email inbox is considered sufficient for this purpose.
Transitional Provisions and Correction Options
A significant relief for businesses is the provision of generous transitional periods by the BMF. Invoices can still be issued in the previous format until the end of 2026. For smaller companies, defined as those with a previous year's turnover of up to 800,000 euros, an extended transitional period applies until the end of 2027.
Furthermore, there is a possibility to correct invoices issued in an incorrect format. This involves subsequently issuing a compliant e-invoice with retroactive effect. This mechanism ensures that the input tax deduction is retained, even if a paper invoice or another electronic format was initially used by mistake.
Adapting General Terms and Conditions and Contracts
Important: The introduction of the e-invoicing obligation often necessitates the adaptation of general terms and conditions (GTCs) and existing contracts. Specifically, clauses pertaining to invoicing and payment transactions should be thoroughly reviewed and updated to include provisions for electronic invoicing.
Agreements concerning data exchange and data security might also require adjustments. This is an area where I can offer my full support.
I will gladly review your existing general terms and conditions and contracts to implement the necessary modifications. Often, a complete rewrite is not required; targeted additions and amendments to individual clauses suffice. By working together, we can ensure your compliance and legal security, particularly concerning IT contract law for startups.
Conclusion and Recommendations
The BMF letter brings much-needed clarity on numerous points, providing companies with a clear direction for preparing for the e-invoicing obligation. While the transitional periods offer some leeway, it is crucial for smaller companies and startups to address this issue early. The conversion of invoicing processes and the adaptation of general terms and conditions and contracts can be time-consuming.
My recommendation: Immediately check if your accounting software supports the creation and sending of e-invoices in the permitted formats. If not, you should promptly seek and implement suitable solutions. It is also advisable to coordinate with your business partners regarding the formats and transmission channels to be used. This proactive approach will ensure a smooth transition.
I am available to assist you with any questions regarding the legal structuring of your invoicing processes, general terms and conditions, and contracts, especially for SaaS companies, in light of the e-invoicing obligation. Feel free to reach out to me!