E-Invoicing by End of 2026: What Companies Must Transition to XRechnung and ZUGFeRD 2.0.1 by December 31
7 Min. Reading time
The e‑invoice obligation has been in force since 1 January 2025 – the receipt obligation already applies to all B2B companies. But the real deadline is approaching: on 31 December 2026 the transition period ends, after which EDI formats that are not EN 16931‑compliant will no longer be accepted as equivalent. From 1 January 2027 companies with an annual turnover above 800 000 Euro must also actively send e‑invoices. What many underestimate: the biggest risk is not the sending duty, but a lack of receipt capability, poor master‑data quality and incomplete ERP compliance.
TL;DR – Key Takeaways
- 31.12.2026 is the hard deadline. The transition period for non‑EN‑16931 formats ends. Anyone still using non‑compliant EDI processes after that violates the VAT Act.
- Receipt capability comes before sending duty. The receipt obligation has been in force since 1 January 2025. If the infrastructure is missing, the company is already in default.
- Master data blocks ERP integration. Missing routing IDs, incorrect GLN or absent VAT‑ID links are typical show‑stoppers for automated invoice processing.
- XRechnung and ZUGFeRD 2.0.1 are not identical. Which format fits depends on the business partner, process type and ERP module – not on personal preference.
Related: CSRD 2026 after the EU Omnibus: Who is still reporting‑obligated
E‑invoice transition: Companies must act by 31 December 2026. Photo: Rainer Knäpper / Wikipedia (CC BY 3.0)
What actually happens on 1 January 2027
The Growth Opportunities Act laid the legal foundation for the e‑invoice obligation in the German B2B sector. The transition rules were limited in time from the start. The end is arriving faster than many finance and IT teams anticipate.
Until 31 December 2026 companies could, as an exception, still use EDI formats that do not meet the EN 16931 standard – provided the recipient agreed. This exemption disappears. From 1 January 2027 all electronic invoices between domestic companies must be either XRechnung or ZUGFeRD 2.0.1 (or newer) – or a structured format that complies with EN 16931. At the same time, the sending duty kicks in for companies with more than 800 000 Euro turnover in the previous year.
Exceptions continue to apply for small‑value invoices under 250 Euro and for tickets. B2C transactions and cross‑border invoices are also unaffected. The focus is clearly on domestic B2B transactions.
The numbers behind the lag
Survey snapshot: Where DACH companies stand (as of Q1 2026)
38 %
of mid‑size firms have not yet set up a structured e‑invoice receipt infrastructure
62 %
cite master‑data gaps as the biggest obstacle to automated processing
Ø 4,5 Mo.
average implementation time for ERP integration with validation layer, based on project experience
Source: Lünendonk/Bitkom surveys Q1 2026, supplemented with ERP implementation figures from consulting projects.
Receiving capability: The underestimated mandatory issue
Since 1 January 2025, all domestic B2B companies are required to receive e‑invoices. That sounds like a given – but it isn’t technically. Receiving doesn’t mean accepting an XML file by e‑mail and opening it manually. It means importing structured data into your own accounts‑payable system, validating it and preparing it for posting without any manual steps.
Many ERP systems – especially older SAP‑ECC installations and DATEV‑based solutions – either have the necessary modules disabled or offer them only as paid add‑ons. The consequence: invoices arrive as XML attachments, land in the inbox and are processed by hand. This does not formally meet the requirement for automated processability.
Extra caution is needed with ZUGFeRD 2.0.1 in Hybrid format: the document contains both a readable PDF and an embedded XML file. Many mail scanners and DMS solutions extract only the PDF, losing the XML. Anyone who assumes they are ZUGFeRD‑compatible simply because they can handle PDFs with XML attachments is mistaken – unless the extraction is explicitly configured.
Master‑data quality as the real show‑stopper
The EN 16931 standard specifies which fields an e‑invoice must contain – and how they must be filled. This includes, among others, the Leitweg‑ID (mandatory field in XRechnung, uniquely identifies the recipient), the GLN (Global Location Number) and a correct, verifiable VAT ID. If these details are missing from the master data, automated processing fails.
The issue is not technical – it’s a data‑maintenance problem. Vendor master data in legacy ERP systems often contain duplicates, incomplete addresses or missing tax IDs. An e‑invoice created on the basis of such master data cannot pass the EN‑16931 validator. The same applies to invoices you receive: if the sender’s Leitweg‑ID does not match your system, the invoice ends up in the error log.
Consequence: a master‑data audit before go‑live is not an optional extra task. It is part of the mandatory pathway.
XRechnung vs. ZUGFeRD 2.0.1: Which format for which case
Switch in 6 steps by 31 December 2026
- Check ERP status (Weeks 1‑2). Which e‑invoice modules are already licensed and active? With SAP: is the FI‑CA module or the Ariba connector set up? With DATEV: is the company online portal configured? Without this analysis every subsequent step is blind.
- Conduct master‑data audit (Weeks 2‑4). Verify all vendor master records for Leitweg‑ID, GLN and VAT‑ID. Clean up duplicates. Clarify missing values directly with suppliers – many have not yet communicated their Leitweg‑ID.
- Decide on the format (Weeks 3‑4). XRechnung or ZUGFeRD – not a blanket rule, but per business‑partner type. Public contracting authorities require XRechnung. Mid‑size customers with DATEV integration prefer ZUGFeRD. Using both simultaneously is possible if the ERP supports both formats.
- Build a validation layer (Weeks 4‑8). Before go‑live, validate invoices with the Mustang validator or the KoSIT testing tools. Faulty invoices in test are cheaper than faulty invoices in production.
- Configure the receipt workflow (Weeks 6‑10). Set up mailbox routing, test XML extraction from ZUGFeRD PDFs, integrate DMS for automated filing. Ensure that erroneous invoices trigger a defined fallback workflow.
- Pilot run with key suppliers (Weeks 10‑16). Don’t start with all 300 suppliers at once. Choose five to ten pilot partners, send and receive real invoices in test mode, verify end‑to‑end accounting integration. Only then launch the full rollout.
Frequently Asked Questions
Does the e‑invoice obligation also apply to small companies with revenue under €800,000?
The receipt obligation has been in force since 1 January 2025 for all domestic B2B companies, regardless of turnover or size. The sending obligation kicks in on 1 January 2027 initially only for companies with annual revenue above €800,000. From 1 January 2028 it applies to everyone – including micro‑enterprises. So even if you are still below the revenue threshold, you should set up the receipt infrastructure now instead of scrambling in 2028.
What happens if a company continues to send PDF invoices by e‑mail?
After the transition periods end, a pure PDF invoice can be formally rejected by the receiving party. From a tax perspective it is not recognised as a proper invoice under the German VAT Act (UStG). That means the recipient cannot claim input tax. The primary risk falls on the invoicing party, which puts its customers in a difficult position.
What is the KoSIT validator and do I have to use it?
The validator from the Coordination Office for IT Standards (KoSIT) is the official checking tool for XRechnung files. It is available free of charge and verifies whether an invoice contains all mandatory fields according to EN 16931 and the German profile. Its use is not mandatory – but in practice public purchasers use it as a reference. Invoices that fail the KoSIT check are automatically rejected by federal and state authorities.
We are still using SAP ECC – what are our options?
SAP ECC will no longer receive regular support after 31 December 2027. For the transition there are essentially three routes: SAP Document Compliance as a middleware solution (covers XRechnung, runs on‑premise), an external e‑invoicing provider such as Basware, Coupa or Tungsten acting as an adapter, or – the longer‑term and more sensible option – migration to S/4HANA, which includes native e‑invoice support from the 2022 version onward.
Photo: Rainer Knäpper / Wikipedia (CC BY 3.0)
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