Implementing E-Invoicing in a Small Business: A 10-Step Plan
Implement e-invoicing in a small business in Germany: 10 steps with the legal basis, backward planning from your 2027 or 2028 deadline and a checklist table.
docutools.pro Editorial TeamEditorial TeamKey takeaways
- Every business established in Germany has had to be able to receive e-invoices since 1 January 2025; the transition periods in § 27(38) UStG only cover issuing.
- If your total 2026 turnover exceeds EUR 800,000, invoices for supplies from 1 January 2027 must be e-invoices; everyone else follows in 2028.
- The plan has ten steps, from an inventory of your customers through format, software and testing to the archive and a written process description.
- Small businesses under § 19 UStG, invoices up to EUR 250 and travel tickets may always stay ordinary invoices (§ 34a, § 33 and § 34 UStDV).
- Invoices must be kept for eight years under § 14b UStG, as the original file and not as a printout.
On this page
To implement e-invoicing in a small business in Germany, work through ten steps: inventory, deadline, inbox, format, software, master data, testing, customer and supplier notice, archive and process documentation. Receiving has been required since 1 January 2025 under § 14 of the German VAT Act (UStG); issuing starts in 2027 or 2028, depending on turnover.
This checklist is for small companies without an IT department, including foreign-owned GmbHs and English-speaking founders who run their books in Germany. Each step names its legal basis and a "done when" test. If you only need to know whether you must issue e-invoices in 2027, the decision tree is in our guide to Germany e-invoicing 2027.
Who needs this plan?
The obligation in Section 14(2) sentence 2 no. 1 of the German VAT Act (§ 14 UStG) (opens in a new tab) covers supplies to another business when both parties are established in Germany. It does not apply to supplies that are VAT-exempt under § 4 no. 8 to 29 UStG. That gives three groups:
| Your situation | Receiving | Issuing | Steps |
|---|---|---|---|
| Domestic B2B customers, total 2026 turnover above EUR 800,000 | since 1 January 2025 | supplies from 1 January 2027 | all 10, deadline 2027 |
| Domestic B2B customers, total 2026 turnover up to EUR 800,000 | since 1 January 2025 | supplies from 1 January 2028 | all 10, deadline 2028 |
| Kleinunternehmer (§ 19 UStG), only consumers, or only exempt supplies under § 4 no. 8 to 29 UStG | since 1 January 2025 | not required | steps 1, 3, 9 and 10 |
The EUR 800,000 test uses total turnover (Gesamtumsatz) as defined in § 19(2) UStG for the previous calendar year (§ 27(38) UStG (opens in a new tab)). Foreign companies without a German establishment fall outside the B2B mandate entirely. Whether a single invoice is exempt is covered by the e-invoicing exemptions checklist.
The checklist: 10 steps to implement e-invoicing
| No. | Step | Legal basis | Example | Done when … |
|---|---|---|---|---|
| 1 | Inventory | § 14(2) UStG | 40 business customers, 3 consumers, 1 authority | every customer is tagged B2B, B2C, B2G or foreign |
| 2 | Find your deadline | § 27(38) UStG | 2026 turnover EUR 620,000 → deadline 1 January 2028 | the date is in the calendar |
| 3 | Set a receiving address | § 14(1) UStG | invoices@example-gmbh.de | all suppliers know it |
| 4 | Choose the format | § 14(1) sentence 6 UStG | ZUGFeRD for companies, XRechnung for the authority | format fixed per customer group |
| 5 | Check your software | § 14(1) sentence 3 UStG | invoicing tool exports XRechnung | one test e-invoice created |
| 6 | Complete master data | § 14(4) UStG | VAT ID, purchase order number, Leitweg-ID | mandatory fields complete per customer |
| 7 | Test | § 14(1) sentence 6 UStG | test invoice to two regular customers | file valid, customer processed it |
| 8 | Notify customers and suppliers | § 14(1) sentence 5 UStG | short letter with format and address | replies collected |
| 9 | Set up the archive | § 14b UStG, § 147 AO | one folder per year, original XML unchanged | first e-invoice archived |
| 10 | Write the process description | GoBD | two pages: intake, check, approval, storage | document exists and is dated |
The steps in detail
1. Inventory: who do you invoice?
Export your customer list and tag each customer: business in Germany (B2B), consumer (B2C), public authority (B2G) or foreign customer. Only domestic B2B customers trigger the mandate. Authorities already require structured e-invoices, usually XRechnung, under federal and state e-invoicing rules, independent of the VAT Act.
2. Find your own deadline
Take your total turnover for 2026, not your profit. Above EUR 800,000, paper and PDF invoices to German businesses are no longer allowed for supplies from 1 January 2027. Until 31 December 2026, everyone may still use paper, or PDF with the recipient's consent (§ 27(38) no. 1 UStG). Existing EDI procedures stay allowed with the recipient's consent until the end of 2027 (§ 27(38) no. 3 UStG).
3. Set a receiving address
§ 14 UStG does not prescribe a transmission channel, so a portal or a Peppol connection is not required for receiving. A dedicated address such as invoices@ keeps invoices apart from other mail. The intake workflow after that is described in how to receive e-invoices in Germany.
4. Choose the format
An e-invoice must follow the European standard EN 16931, or an agreed format from which the required data can be extracted correctly and completely into a compliant format (§ 14(1) sentences 6 and 7 UStG). In practice this means XRechnung (pure XML) or ZUGFeRD (a PDF with embedded XML; Factur-X is its French twin). The ZUGFeRD profiles MINIMUM and BASIC WL carry no invoice lines and are not enough; see ZUGFeRD profiles and versions. For the choice between the two, read XRechnung vs ZUGFeRD.
5. Check your software
Ask your vendor two questions: does the program export XRechnung, or ZUGFeRD from version 2.0.1? And which XRechnung version? The current specification is XRechnung 3.0.2; according to xeinkauf.de (opens in a new tab), the final XRechnung 4.0 is expected in spring 2027. A neutral overview of options is in free e-invoicing software for Germany.
6. Complete your master data
An e-invoice carries the same mandatory details as any invoice under § 14(4) UStG, only in fixed fields. Gaps show up at export: missing VAT IDs, incomplete addresses, a purchase order number the customer insists on. Authorities also need a Leitweg-ID (buyer reference, BT-10). The full list is in German invoice requirements.
7. Test before it counts
Create a test invoice for two or three regular customers, check the file technically and send it marked "test". The step is done only when the customer confirms they could process it. A four-level test plan with a log template is in test an e-invoice before sending.
8. Notify customers and suppliers
An e-invoice you are obliged to issue needs no consent from the recipient (§ 14(1) sentence 5 UStG). A short notice still prevents returns: give your receiving address, your format and the switch date, and ask for purchase order numbers and contacts. Foreign-owned companies often send this notice in German and English.
9. Set up the archive
Invoices must be kept for eight years under § 14b UStG (opens in a new tab), counted from the end of the calendar year of issue; accounting vouchers (Buchungsbelege) also have an eight-year period under § 147(3) of the German Fiscal Code (AO). Keep the original file, and for ZUGFeRD the PDF with its embedded XML. The archiving rules are explained in e-invoice archiving in Germany.
10. Write the process description
The German bookkeeping principles (GoBD) require a process description (Verfahrensdokumentation) that lets an expert third party follow your workflow. For a small business a few pages are often enough: where invoices arrive, who checks, who approves, where the original is stored and who covers during holidays. Date the document and update it when software or responsibilities change.
Backward planning: what must be ready when?
How many weeks the switch takes depends on your software, the number of customers and your tax adviser, so a generic estimate would not help you. A sequence counted back from your deadline is more useful:
| Milestone | Depends on | Latest |
|---|---|---|
| Receiving works (steps 3, 9) | nothing | now; required since 1 January 2025 |
| Deadline known (step 2) | 2026 turnover | as soon as 2026 turnover is final |
| Format and software fixed (steps 4, 5) | inventory | before the first tests |
| Test invoices confirmed (step 7) | software, master data | before the deadline, with time for fixes |
| Customers notified (step 8) | test result | before the first live e-invoice |
| Process description (step 10) | all workflows | with the switch |
If your turnover is close to EUR 800,000, plan for the 2027 deadline. If the figure is only final in January, there is no time left for testing otherwise.
Special cases
- Kleinunternehmer: invoices for supplies exempt under § 19(1) UStG may always be sent as ordinary invoices (§ 34a UStDV (opens in a new tab)). Receiving still applies; see Kleinunternehmer e-invoice rules.
- Small-amount invoices and tickets: invoices up to EUR 250 in total (§ 33 UStDV) and travel tickets (§ 34 UStDV) may also always be ordinary invoices.
- Foreign customers: the mandate requires both businesses to be established in Germany. Invoices to customers abroad do not change under German law.
- New BMF letter: on 15 October 2026 the Federal Ministry of Finance (BMF) published a further letter with supplementary rules on e-invoicing (BMF download page (opens in a new tab), in German). Ask your tax adviser whether it affects your invoice templates.
How do you document the rollout?
Keep evidence for each step: the tagged customer list, the 2026 turnover figure for the EUR 800,000 test, the vendor's confirmation of the format, the test log with dates and customer feedback, the notice you sent and the dated process description. The turnover figure matters most: a business still sending paper invoices in 2027 may need to show that its total 2026 turnover was at most EUR 800,000.
How to do it with docutools.pro
- For step 5: open the generator to create an XRechnung or ZUGFeRD file. The wizard runs "Company → Items → Export"; under "Generate & download" choose "XRechnung XML", "ZUGFeRD XML" or "ZUGFeRD PDF". Single invoices need no account. The generator creates type 380 invoices only and has no Kleinunternehmer option.
- For step 6: use the "Checkliste" mode of the German invoice requirements checker to compare your invoice template with the mandatory details. It runs in your browser.
- For step 7: upload the test file to the XRechnung validator. The "KoSIT validation" result reads "KoSIT-conformant / Valid XRechnung" or "Not KoSIT-conformant"; the viewer checks the way the KoSIT validator does (configuration 2026-08-31). The file is sent to our server for the check. For a ZUGFeRD PDF, first extract the XML from the PDF.
- If errors appear, look up the code in the list of XRechnung validation errors and fix the cause in your invoicing software, not in the file.
The viewer's free tier allows 2 uploads a day up to 500 KB per file. Unlimited uploads, ZIP batches and CSV batch generation are part of the Pro plan (Pro), see pricing. More practical guides are collected under invoicing in Germany guides.
Sources
- § 14 UStG: issuing invoices (opens in a new tab) (German)
- § 27(38) UStG: transition rules 2025 to 2027 (opens in a new tab) (German)
- § 14b UStG: retention of invoices (opens in a new tab) (German)
- § 147 AO: retention of records (opens in a new tab) (German)
- § 33 UStDV (opens in a new tab), § 34 UStDV (opens in a new tab) and § 34a UStDV (opens in a new tab) (German)
- XStandards Einkauf: XRechnung versions and validity (opens in a new tab)
Last reviewed: October 2026
This article is general information, not tax or legal advice.
Tools for this article
- XRechnung ViewerParse, validate & repair German e-invoices with GoBD-compliant audit trail.Open tool →
- E-Invoice GeneratorCreate compliant XRechnung XML and ZUGFeRD hybrid PDF invoices instantly.Open tool →
- Invoice Mandatory Fields CheckerVerify all mandatory §14 UStG invoice fields via checklist or XRechnung/ZUGFeRD XML.Open tool →
Frequently asked questions
How long does it take to implement e-invoicing?
There is no fixed duration. It depends on how many business customers you invoice, what your current software can export and how your tax adviser works. Plan backwards instead: your deadline is 1 January 2027 if your total 2026 turnover is above EUR 800,000, otherwise 1 January 2028. Successful test invoices with real customers should be done well before that date.
Do small businesses in Germany need e-invoicing software?
Not necessarily new software. Many invoicing programs already export XRechnung or ZUGFeRD, so check your current tool first. For receiving, a viewer that makes the XML readable is enough. A business that sends only a few invoices can create single e-invoices with an online generator. What matters is that the file follows the European standard EN 16931.
Does e-invoicing apply to a foreign company with a German customer?
The German B2B mandate applies only when both the supplier and the customer are established in Germany. A company without a seat or permanent establishment in Germany does not have to issue e-invoices under § 14 UStG. Invoices to German public authorities are different: federal and state rules require structured e-invoices there, usually XRechnung, and they also apply to suppliers based abroad.
Can a Kleinunternehmer keep sending PDF invoices?
Yes. Under § 34a UStDV, invoices for supplies exempt under the small-business rule (Kleinunternehmerregelung, § 19 UStG) may always be sent as ordinary invoices, meaning PDF or paper. A Kleinunternehmer must still be able to receive e-invoices from suppliers since 1 January 2025 and keep them for eight years.