E-Invoicing in Germany 2027: What Freelancers and Small Businesses Need to Know

This article is for general informational purposes only and does not constitute legal or tax advice. For questions about your specific situation, please consult a tax advisor.

What Actually Counts as an E-Invoice?

An e-invoice is an invoice in a structured electronic format based on the European standard EN 16931, one that can be read and processed by machine. In Germany that means XRechnung and ZUGFeRD above all.

The most important sentence first, because this is where most of the confusion starts: a PDF is not an e-invoice. Not when you email it, not when it looks immaculate. Since 2025, a PDF counts legally only as a "sonstige Rechnung", an other invoice. What matters is not that the invoice is digital but that its content is structured, meaning a dataset rather than a picture of a document.

One practical consequence: you may only send an other invoice in an electronic format with the recipient's consent. For a genuine e-invoice, you do not need that consent.

When Does the Obligation Apply to You?

The obligation arrives in two steps, and they are unevenly spread. Receiving came long before issuing.

Since 1 January 2025: every domestic business must be able to receive e-invoices. That applied from day one, with no transition period.
From 1 January 2027: businesses whose total 2026 revenue exceeded 800,000 EUR must issue e-invoices for B2B transactions.
From 1 January 2028: the issuing requirement applies to all businesses in B2B transactions.

The mechanism works differently from how it is usually described. The e-invoicing obligation has been law since 2025. What helps until those dates are the transitional rules in §27 Abs. 38 UStG, which permit paper and other invoices for a limited time:

For transactions up to 31 December 2026, any business may still invoice on paper, and in another electronic format with the recipient's consent.
For transactions during 2027, that only still applies if your total revenue in the previous year, meaning 2026, was no more than 800,000 EUR.

The distinction is more than pedantry. Nothing new begins; a permission expires. And the 800,000 EUR line is measured against your 2026 revenue, not against the year in which you write the invoice.

What About Invoices to Consumers?

They stay out of scope. The obligation only covers transactions between domestic businesses. Invoices to consumers (B2C) can still go out as a PDF or on paper.

Small-amount invoices up to 250 EUR and transport tickets are likewise exempt.

And When Invoicing Public Authorities?

That is a separate and older regime. Anyone supplying federal public-sector clients has been delivering electronically since 2020, generally as XRechnung and through an administrative portal, often using a Leitweg-ID as the routing identifier. The details vary by federal state.

So if you invoice public authorities, XRechnung has concerned you for years already, regardless of the B2B deadlines.

Do Kleinunternehmer Have to Issue E-Invoices?

No, and permanently so. Kleinunternehmer under §19 UStG are exempt from the obligation to issue an e-invoice. This is not a transition period that lapses in 2028.

They still have to receive them. The tax authority states explicitly that the duty to create the technical conditions for receiving applies even where the recipient falls under the §19 UStG special scheme.

That is the asymmetry worth knowing: as a Kleinunternehmer you may keep writing PDFs, but you must be able to accept and retain your suppliers' e-invoices.

What Happens If You Cannot Receive an E-Invoice?

Nothing good, and this is the part almost every guide leaves out.

A business that is technically unable to receive an e-invoice, or simply refuses to accept it, has no claim to an alternative invoice in another format. The issuer does not have to send you a PDF after the fact.

It goes further: the issuer's VAT obligations count as fulfilled if they issued the e-invoice and demonstrably made an effort to deliver it properly, for example evidenced by a transmission log. The invoice exists, even if it never reaches you.

In practice, the risk sits with you as the recipient, not with the sender. And without an invoice, input tax deduction becomes difficult.

The good news is that the bar is low. An email inbox is enough, and a separate inbox just for e-invoices is explicitly not required. You do not have to set up anything you do not already have.

XRechnung or ZUGFeRD: What Is the Difference?

Both satisfy the standard, but they solve the problem differently:

XRechnung is a pure XML file. A human can barely read it without a viewer; a machine reads it flawlessly. It is the standard in the public sector.
ZUGFeRD is a hybrid: a PDF with the XML dataset embedded in it. Your client sees an ordinary invoice while their software still reads the data in structured form.

To the legislator the two are equivalent. The difference is practical: if your clients still check invoices by hand, ZUGFeRD is the kinder option. If you supply public authorities, XRechnung is rarely avoidable.

How Do You Retain an E-Invoice Correctly?

This is where the expensive mistake hides. Retention must generally be in the format received, and for an e-invoice at least the structured part must be retained so that it remains intact in its original form.

Translated: if you receive a ZUGFeRD invoice and print it as a PDF, or save only the visible page, you have archived the wrong thing. The document subject to retention is the XML dataset, not the attractive rendering of it.

Two points of relief:

For VAT purposes, storing and archiving e-invoices outside a GoBD-compliant data processing system does not by itself constitute a breach of §14b Abs. 1 UStG. Obligations under the AO and the GoBD are unaffected.
The period is the same as for any other invoice: 8 years, cut from 10 in 2025.

How those periods run and when the clock starts is covered in retention requirements for invoices. How your filing meets the requirements overall is in GoBD-compliant invoices.

What About Recurring Invoices and Subscriptions?

For Dauerschuldverhältnisse, meaning retainers, rental agreements, or monthly flat fees, three concessions save a lot of work:

It is enough to issue an e-invoice once, for the first partial performance period, with the underlying contract attached or with the content otherwise making clear that this is a Dauerrechnung.
As long as the invoice details do not change, a recurring invoice lawfully issued as an other invoice does not have to be converted to an e-invoice after the fact.
As the invoice number in the structured part, a one-time number from the contract is enough, such as a property or client number. Individual payment documents need no separate sequential number.

If the mandatory fields under §§14, 14a UStG do change, a price increase being the obvious case, the original e-invoice must be corrected or a new one issued. More on that and on the setup in your tool is in automated invoicing.

How Do You Correct an E-Invoice?

In the same format you issued it in. An e-invoice is not cancelled by a PDF.

The correction has to carry the original invoice's number and its issue date, in the structured fields BT-25 and BT-26. Without them the correction does not attach to the original invoice and has no tax effect. The full process is in writing a cancellation invoice.

How Do You Issue an E-Invoice?

You do not need an accounting system for it. An invoicing tool that handles the formats is enough, and that is now the norm rather than the exception.

revoBill creates e-invoices in XRechnung format, with no volume cap and at no cost. ZUGFeRD is not currently included. If your clients ask for the hybrid format, the invoicing software comparison shows which tools cover both formats and on what terms.

What to watch when you switch:

Complete your master data. A structured dataset needs clean details for the client, tax number, and bank account. Gaps nobody notices in a PDF can make an e-invoice invalid.
Send a test document. Have a client confirm their software can read the file before you switch over.
Check your archiving. Make sure your tool stores the structured part and keeps it exportable, not just a preview.
Sort out receiving. You have been obliged to accept e-invoices since 2025. Check whether your filing actually keeps incoming XML files.

Common Mistakes

Treating a PDF as an e-invoice. The single most common error, and the basis for nearly all the others.
Archiving only the rendered view. With ZUGFeRD, the embedded dataset is the original.
Relying on a transition period that does not apply to you. The extension into 2027 depends on your 2026 revenue.
Ignoring receiving as a Kleinunternehmer. The exemption covers issuing, not receiving.
Cancelling an e-invoice with a PDF. The correction belongs in the same format.