Until now, companies themselves were faced with the choice of issuing or receiving their invoices digitally or by letter to authorities, public institutions or municipalities. With Directive 2014/55/EU adopted by the EU, also known as the E-Invoicing Regulation (ERechV), electronic invoicing will become mandatory from November 2020. From this point at the latest, companies from the private sector should also take a close look at their own processes and digitize invoice workflows.
What are electronic invoices / e-invoices
E-invoices are electronically transmitted invoices. These e-invoices were already treated in the same way as paper invoices in the course of the Tax Simplification Act of 2011.
In order not to lose track of the entire e-invoicing, we give a short excerpt of the currently possible types of electronic invoicing.
PDF – A common variant of the electronic invoice is currently the invoice sent by e-mail or interface as a PDF. Here, both the sender and the recipient have the documents directly available in electronic form. However, if these do not meet the specified standard in their form, they will no longer be sufficient for electronic invoicing in the future.
ZUGFeRD – With ZUGFeRD, a new standard has been developed in Germany in cooperation with representatives of industry, ministries and industry associations. This format meets the requirements of international standardization and can be used in national and European accounting transactions. ZUGFeRD files are still readable PDF invoices that contain embedded machine-readable data. This means that ZUGFeRD invoices can be processed by the user even with poorly developed IT systems.
XRechnung – This is an electronic invoicing standard specified by CEN, the European Committee for Standardization, and implemented by Germany. In order to implement the European requirements (“CEN/TC 434 – Electronic Invoicing”), it has been possible to send all authorities the nationwide uniform electronic invoices in the XRechnung standard since April 2020. The biggest difference to the ZUGFeRD standard is the processing of the data from the invoice. XRechnungen are no longer readable without a sophisticated IT infrastructure. In terms of transmission channels, the German portals ZRE (Central Invoice Receipt Platform), OZG RE (Online Access Act-compliant Invoice Receipt Platform), VPX and the European infrastructure PEPPOL (Pan-European Public Procurement OnLine) are particularly noteworthy. Each federal state can decide for itself on the transmission route for state and local authorities. EDI (Electronic Data Interchange) – For the sake of completeness, EDI must also be mentioned as an exchange tool at this point. This is a form of electronic data interchange in which files such as invoices, delivery notes or orders can be exchanged electronically on the basis of a standardised format. Invoices are created in such a way that the data can be interpreted in exactly the same way on both the sender and recipient sides. The files are exchanged in the form of predefined and formatted data and without the intervention or modification of persons. The data can then be processed immediately after transmission and receipt.
Conversion alone is only the first part of the change
When considering processes and workflow organization within companies, it is important to consider electronic invoices as part of a whole. They are not digitized on their own, but are usually replaced in the course of extensive digitization projects from paper documents to fully digital files or exchange data. Processes affected by this are often approval workflows, shipping processes and accounting in general.
Requirements for e-invoicing to public contracting authorities from November 2020
When switching to e-invoicing, the following requirements must be observed, especially for invoices:
- The invoice recipient must agree to receive the electronic invoices.
- The XRechnung data exchange standard in the current version or comparable standards must be used, insofar as they comply with the European standard for electronic invoicing.
- The electronic invoice must be able to be issued, sent, received and processed in a digital format.
- The authenticity of the origin of the invoice must still be guaranteed. This can be done by means of a digital signature or internal control procedures – other solutions are also conceivable.
- The integrity of the invoice must be guaranteed.
- The invoices must also contain all invoice characteristics/mandatory information for VAT deduction (supplier number, order number, bank details, payment terms, in the case of XRechnung also routing identification number for the clear address to an invoice recipient). New is the specification of the DE-Mail address or an e-mail address of the invoice issuer.
Exceptions to the E-Invoicing Act
In addition to the many requirements and regulations for e-invoicing, there are of course also exceptions in the ERechV, which will affect many invoices issued. The following situations are excluded from the regulation:
- Security-relevant contracts with highly sensitive invoice data
- Invoices with an invoice value of less than 1,000 euros (net) (cf. § 3 ERechV)
- All matters relating to the Foreign Service
Result
With the help of the E-Invoicing Act, the federal government is setting a deadline for Germany-wide digitization and optimization of now outdated processes in invoicing and receipt of invoices for public institutions and authorities. In view of the current pandemic, this is a step in the right direction and long overdue.
It is important for the conversion of your own invoicing process
With digital accounting and digital invoice processing, we can support your entry into Accounting 4.0.
Have you already changed your invoices or are you in the process of doing so? We are looking forward to your experiences with the new process.
Image source: stock.adobe.com, Photographer: momius
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