Checklist: Mandatory electronic invoicing from 2025 in the hotel and food service industry

What hotels, restaurants, and other hospitality businesses need to know about the obligation to issue electronic invoices in Germany

In Germany, not only paper invoices between companies will be abolished by 2025 (regardless of whether they are sent by mail, fax, or delivered in person) but their “digital” version as an e-mail with a PDF attachment will also be obsolete by 2027 at the latest. Invoices in other invoice formats that do not comply with the European digital standard EN 16931 will also be a thing of the past for accounting purposes—even if they are transmitted via “Electronic Data Interchange” (EDI).

Does that sound a little too ambitious in terms of time alone?

After all, this changeover affects around three and a half million companies in Germany. These are estimated to exchange more than 32 billion invoices with each other every year.

 

Step by step to the full e-invoicing mandate

In order to prevent the German economy from being completely digitally overwhelmed, the German government and tax authorities have therefore drawn up a kind of “phased plan” at an early stage with the aim of introducing mandatory e-invoicing for B2B transactions. The government-imposed digital revolution in accounts payable, and accounts receivable accounting is then to take place gradually. Over a period of three years, politicians are hoping for an orderly, cautious, and less painful farewell process to the classic standard invoice by mail, fax, or e-mail.

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Digital transition in three phases–goodbye traditional invoicing, hello mandatory XRechnung

The first to be affected will be paper invoices with a “grace period” ending in 2026. After that, all other electronic formats that do not qualify as “genuine e-invoices” under the new law will also be included. In plain terms: almost all, apart from electronic invoices in the XRechnung or ZUGFeRD formats (and only from version 2.x).

Graphic Phases Introduction e-invoice

Attention: E-invoices must be accepted!

Important to know: This primarily concerns the electronic receipt of invoices. This is the only mandatory requirement from January 1, 2025. Or to put it another way:

Hotels, restaurants, caterers, and other companies in the hospitality industry that receive a “genuine” electronic invoice in one of the aforementioned EN-compliant formats must accept it from January 1, 2025. If they do not, they will be in breach of the law.

However, there is still a (small) loophole for the time being. Anyone who agrees with their own suppliers to continue exchanging paper invoices for the time being may continue to do so for a further 365 days. After that, this will be possible only if the company receiving the invoices had a turnover of less than €800,000 in the previous year. However, this will also come to an end at the beginning of 2027.

From 2027, only the digital exchange of invoices between companies will be permitted without exception. Paper invoices will no longer be recognized as vouchers by the German tax authorities. The “classic” invoice will be history.

That covers what lies ahead in the digital shift. It applies not only to companies in the national and international hospitality industry but also to the small florist around the corner, the regional bakery chain, the nationwide restaurant group, and indeed all other German businesses—across every sector, size, and legal form.

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What is a “genuine” electronic invoice?

Now the question arises: What is the big difference that makes all this necessary? Is the purely electronic exchange of invoices between companies really so important? - And if so, why? The answer is clear: Yes! Because electronic invoices

  • eliminate manual invoicing and processing workflows
  • save hundreds of thousands of tons of paper used for printed invoices and vouchers
  • are more secure, more reliable, and faster than traditional invoice formats

and will enable the German tax authorities to carry out digital VAT audits in real time. This gain in control is estimated to bring the German state budget additional tax revenue of well over EUR 10 billion a year because it will make VAT fraud virtually impossible.

So it’s no wonder that Germany is now following in the footsteps of Italy, Spain, and Hungary and making a noticeable push towards electric billing. Or is it?

Incidentally, this is made possible by the nature of “genuine” e-invoices, which are machine-readable data records that contain all important (and tax-relevant) invoice data.


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How are digital documents such as e-invoices received?

Good question! After all, this is the prescribed minimum capability that every German company must have in less than nine months (this article was written in April 2024) in order to comply with the amended VAT Act.

The crux of the matter: unfortunately, it’s not quite as trivial as politicians and the tax authorities would like to make it out to be—at least not if you have to take care of it yourself as an entrepreneur. And even with experienced accounting and IT staff on board, even this first stage of the German e-invoicing mandate presents many hotels, restaurants, and catering companies with quite a challenge.

Why is the gradual e-invoicing mandate of all things a challenge?

Particularly in industries and sectors in which countless supplier relationships are maintained with a wide variety of partners (perhaps even from Germany and abroad) the continued acceptance of paper and PDF invoice formats is likely to create considerably more complexity in accounts payable management, especially at the beginning. After all, it is more than unlikely that only electronic invoices will suddenly be sent at the turn of 2024/25.

How do you receive such an electronic invoice?

The simple answer to how hotels, restaurants, and other hospitality businesses will have to receive invoices in future? There is no such thing. This is because no explicit transmission channels have (yet) been defined for electronic invoices within the meaning of the new VAT Act. In reality, however, there are two—or rather three—main channels through which the electronic exchange of invoices will take place (and has already been taking place for years in the case of invoicing to the public sector):

  1. Electronic invoicing by e-mail (insecure and impractical)
  2. Electronic invoicing via EDI (expensive and time-consuming)
  3. E-invoice exchange with invoice recipients and suppliers via the European Peppol network (still relatively unknown)

E-invoices via e-mail: possible, but nothing more

Good. There is still e-mail. But don’t rejoice too soon: unfortunately, this brings with it a whole series of tangible problems. After all, despite potential end-to-end encryption, electronic mail traffic is not only particularly easy to infiltrate. Electronic invoices sent by e-mail usually also have to be processed manually (at least) once and transferred to the relevant accounting or ERP system. And: a manual “visual check” of a “genuine” e-invoice is possible only with a hybrid e-invoicing format such as ZUGFeRD. This is because, in addition to the mandatory data record, it also consists of a visual component in PDF format.

E-invoices via EDI: more for the really big players

On the other hand, the much more widespread Xrechnung, which is clearly preferred by the German tax authorities, comes exclusively as a cryptic data record. Visual invoice processing? No way! But that’s not all: most European e-invoices today are not sent via e-mail but rather via dedicated, individual data connections (also known as EDI). Incidentally, this is an industry procedure that is generally worthwhile only when many tens or hundreds of thousands of invoices must be sent between two partners.

E-invoices in the Peppol network: the digital future?

Or the electronic exchange of invoices takes place via the Peppol network, which is virtually unknown to the general public. Originally created for the digital exchange of data and invoices between public authorities and other public sector players, a large proportion of digital transaction data is now exchanged via this stable, secure, and ultra-fast data network. And this has long been the case in the B2B sector too. The only “catch”: Access to Peppol is via a Peppol Access Point, and direct sending or receiving is not possible.

Nevertheless, this option is becoming increasingly popular—not only in Germany but also throughout Europe. This is probably also because increasingly more e-invoicing providers, accounts payable management service providers, and accounts payable applications are providing—or at least integrating—this access point. Or the electronic exchange of invoices takes place via the Peppol network, which is virtually unknown to the general public. Originally created for the digital exchange of data and invoices between public authorities and other public sector players, a large proportion of digital transaction data is now exchanged via this stable, secure, and ultra-fast data network. This has long been the case in the B2B sector as well. The only “catch”: Access to Peppol is via a “Peppol Access Point”, and direct sending or receiving is not possible.

Nevertheless, this option is becoming increasingly popular not only in Germany but throughout Europe. Probably also because more and more e-invoicing providers, accounts payable management service providers, and accounts payable applications are providing (or at least integrating) this access point.

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What do companies in the hospitality industry now need to do to comply with the legal requirements for receiving and issuing invoices?

As you can see: Despite the “phased plan” and the fact that, for now, only the obligation to receive invoices applies as of the deadline of January 1, 2025, the electronic invoicing requirement is quite a challenge, especially in terms of organization, processes, and technology. Those who have already relied on digital purchasing, invoice receipt, and voucher processing for their own accounts payable management in the past now have a clear advantage. But even any “late bloomers” still have enough time to prepare for the impending obligation to process invoices electronically.

This is particularly easy and cost-efficient with our special solution for digital accounts payable management: cisbox Invoice cisbox Invoice.

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FAQ

Frequently asked questions about the e-invoicing obligation from 2025 for hotels, restaurants, and other businesses in the hospitality sector 

From a purely theoretical point of view, printing is not prohibited. In practice, however, the printed document does not replace the original transmitted document. On the contrary: this approach counteracts the purpose of the electronic invoice and turns an “electronic data record” back into an “image”, a counterproductive move against the intended workflow and legislation.

In addition, according to the “Principles for properly maintaining, keeping and storing books, records and documents in electronic form and for data access” (GoBD), it is not permitted to archive the invoice in printed form. This is because the originally transmitted electronic format is decisive and thus regarded as the only permissible “original voucher” In classic bureaucratic terms, the printout merely constitutes a “posting aid”.


Furthermore, electronic invoices consist of character sequences that are difficult for people to interpret and no longer have anything in common with the appearance of the “classic” invoice. So it’s usually not really worth printing them out anyway.

The same legal obligations and storage requirements such as the aforementioned GoBD apply to electronic invoices as to all previous invoice formats (e.g., paper, PDF).
Yes, the obligation to receive genuine electronic invoices in Germany also applies to supplier invoices from abroad provided that this supplier sends its invoices in an electronic invoice format. The obligation to receive electronic invoices applies regardless of whether the supplier is based in the European Union or in a third country.
Yes, the electronic invoicing obligation in Germany also applies to invoices for smaller amounts. However, if the invoice amount is less than €250 or if it is a ticket, there is no obligation to receive invoices electronically.
This is not so easy because the legal regulations on e-invoicing in Germany can be found in different places depending on the recipient group and jurisdiction—at least when it comes to invoicing the public sector.

However, the regulations that will make the receipt of electronic invoices mandatory for B2B transactions from January 1, 2025 are much more important for companies in the hospitality and catering sector.

Genuine e-invoices, which consist of machine-readable data records, cannot easily be visually captured and read by humans because they are intended for automatic processing by computer programs. However, there are various ways for humans to view e-invoices such as suitable visualization software, web portals, or conversion to PDF. These options make it easier for people to view e-invoices based on a familiar invoice layout.

But please note: This form of presentation does not replace the validity of the electronic data record and should at best be regarded as a support (posting aid). Under no circumstances should you use printed e-invoices for the legally required voucher archiving. 

Yes, e-invoices are GoBD-compliant if they meet certain requirements. First, the e-invoice must comply with the structured, machine-readable format (EN 16931). In addition, the same applies to the e-invoice as to the classic paper invoice: all legally required mandatory information must be included in the e-invoice (e.g., the invoice number, date, address of the invoicing party and invoice recipient, the goods or services supplied, the net amount, and the VAT). In addition, the e-invoice must be unalterable for the duration of the retention period and machine-readable at any time in order to comply with the GoBD.

In fact, there is a lot to consider when it comes to the technical requirements for receiving invoices electronically.

  1. First, companies must ensure that they are ready to receive invoices from January, 1 2025. They must therefore be able to receive e-invoices in a structured, machine-readable format (e.g., via an e-invoicing system, an ERP system, or a portal).
  2. In addition, the company’s IT infrastructure should be able to process the volume of expected e-invoices and integrate the e-invoice format into the accounting system and other relevant systems.
  3. Third, the validation and processing of e-invoices must be guaranteed. The validity and accuracy must be verifiable, it must be possible to transfer the data to other systems in the company, and the e-invoice must be archived in such a way that it is available at all times without any gaps or changes. 

Non-compliance with the e-invoicing obligation in Germany can have various legal consequences such as fines and late payments or result in tax audits being ordered by the tax office. Furthermore, non-compliance can mean a loss of reputation for affected companies if business partners view the company as unreliable and break off cooperation.