Germany is undergoing a significant transformation of its invoicing and VAT compliance system.
Over the next three years, the country will not only consolidate its two federal e-invoicing platforms into a single portal, but also implement a phased B2B e-invoicing mandate requiring all businesses to issue and receive structured electronic invoices by 2028. These developments aim to modernize digital financial processes, mitigate VAT fraud, and streamline compliance for both suppliers and the government.
Consolidation of Federal E-Invoicing Platforms
Since 2018, the German federal administration has operated two distinct e-invoicing portals: the ZRE platform, which serves the central federal administration, and the OZG-RE portal, utilized by subordinate federal bodies and various federal states (Länder). This dual-system approach introduced unnecessary complexity, often leaving suppliers unsure about which portal to use and requiring the government to maintain two separate infrastructures.
In November 2024, the Federal Ministry of Finance (BMF) and the Federal Ministry of the Interior (BMI) announced a much-anticipated consolidation plan. Moving forward, the OZG-RE portal will become the sole federal portal for receiving e-invoices from suppliers. The migration process will occur in stages throughout 2025:
May 23, 2025: The Bundeswehr Purchasing Office will be the first agency to transition from ZRE to OZG-RE.
June 20, 2025: A first wave of additional federal authorities will migrate.
December 31, 2025: The ZRE platform will be decommissioned, and all federal e-invoices must be submitted through OZG-RE.
The transition will have varied implications for suppliers. Companies invoicing through the Peppol network will be automatically redirected to the appropriate endpoint, requiring no manual adjustments. However, those using the ZRE web portal will need to register on OZG-RE in 2025 to ensure compliance after ZRE is phased out. This consolidation is expected to eliminate redundant infrastructure, simplify the user experience, and enhance the efficiency of federal invoicing processes.
Phased Implementation of Mandatory B2B E-Invoicing
Simultaneously, Germany is rolling out a B2B e-invoicing mandate that will transform domestic trade documentation. This initiative aligns with the European e-invoicing standard EN 16931 and will be implemented in three primary phases:
January 1, 2025: All VAT-registered businesses must be prepared to receive structured e-invoices immediately; no grace period will be provided.
January 1, 2027: Companies with an annual turnover exceeding €800,000 will be required to issue e-invoices for domestic B2B transactions.
January 1, 2028: All businesses, regardless of size, will be mandated to issue structured e-invoices, and paper invoices will no longer be accepted for B2B transactions.
Several practical allowances are included in this transition. Invoices below €250 are exempt from full e-invoicing requirements, and small businesses will only need to receive structured e-invoices until 2028, without the requirement to issue them. Additionally, the ZUGFeRD 2.3 standard, updated in May 2025, will support these new regulatory mandates.
To facilitate this digital transition, Germany is also standardizing its invoice retention policies. Beginning in 2025, invoices must be retained for eight years, synchronizing archiving periods with the new digital-first framework.
How Can KGT Support You?
KGT has created an SAP-integrated e-invoicing add-on solution for Germany, featuring outbound and inbound functionalities to meet tax reporting requirements. This add-on includes a data extractor and a cockpit for generating periodic electronic invoices in the legal format and controls before submission. When SAP DRC launched the German e-invoicing solution as part of its e-document offerings, KGT emerged as a leading consultancy firm for SAP DRC and tax services. Recognized as an SAP DRC partner for German e-invoicing services, KGT is one of SAP's recommended implementation partners for this solution. We provide comprehensive support, including installation, configuration, customization, and training, to help you maximize the long-term value of your SAP DRC investment.
KGT is an SAP partner for PE services and an SAP Build partner, and to become an SAP partner, strict due diligence requirements must be met, including having certified SAP consultants. You can find us at: https://partnerfinder.sap.com/profile/0001925409
