E-invoicing is coming – effects on the retail sector

The current development in e-invoices

In just over a month, e-invoices will become the new standard for B2B transactions within Germany. The Federal Ministry of Finance (BMF) published some responses and clarifications in a circular letter on 15 October 2024. Besides issues concerning technical implementation, these were primarily dedicated to the practical challenges that businesses will face. Even though some questions still remain open, one thing is clear: e-invoicing will be a challenge to all businesses, including those in the retail and consumer products sector. But it also offers opportunities. 

An overview of e-invoices 

According to the legal definition in Section 14(1) sentence 2f. of the VAT Act (novel version) (Umsatzsteuergesetz – UStG), an e-invoice is an invoice that: 

• corresponds to the European CEN format EN 16931, e.g. 
  • XRechnung,
  • ZUGFeRD from version 2.0.1 (except for certain profiles) or
  • European formats like Factur-X or Peppol BIS Billing,
• or in a format individually agreed between the service provider and the recipient. The condition for this is that this format can be transferred into a CEN format correctly and completely (known as interoperability), e.g. by EDI such as EDIFACT (to be adapted as required to ensure interoperability).

Opportunity of e-invoices in the invoicing process 

The introduction of e-invoicing lays the groundwork for setting up direct processing in your ERP system with standardised datasets. A simultaneous, automated check of the invoice conditions under Section 14(4) of the VAT Act (UStG) can significantly improve the invoice receiving process. In light of the goal of the European legislation of real-time or near-time reporting, businesses already have the way to design an entire invoicing process that is not only standardised nationally but Europe- and worldwide.    

But the disparate regulation will also continue to develop in perpetuity. It’s therefore recommended to develop a global strategy for e-invoicing early, and ideally for digital reporting.  

How we can assist you with e-invoices

Analysing your existing invoicing process is crucial to solving the issue of having a customised solution to the requirements of e-invoicing. We provide assistance in considering potential solutions, taking the requirements of e-invoices into account. We have the right solutions for various sizes of companies and to changing your processes over in a gradual way.

That’s how we can help you fulfil the legal requirements by 1 January 2025 and implement a scalable solution long-term, so your company can take advantage of the digitalisation of invoicing and meet future obligations on electronic reporting.

Any questions? We’d be glad to hear from you.

The article was written by our experts Simon Gode, Christoph Beutler, David Peter and Pascal Ochs.