E-invoicing 2027 in Germany: what construction firms need

From 1 January 2027, companies in Germany whose total turnover in the previous year exceeded €800,000 must issue invoices to other domestic businesses as e-invoices (E-Rechnung). From 1 January 2028 this applies to all businesses. Every business has had to be able to receive e-invoices since 1 January 2025. For construction firms this means most supplier invoices will soon arrive as XML, and their own progress and final invoices will have to be e-invoices too.

Note: this article is an overview and not tax advice. Clarify the details for your company with your tax adviser (Steuerberater).

Legal basis: Growth Opportunities Act and Ministry of Finance guidance

The e-invoicing mandate was introduced in 2024 by the Growth Opportunities Act (Wachstumschancengesetz) and is set out in § 14 of the German VAT Act (UStG). The Federal Ministry of Finance (BMF) has detailed the rules in administrative guidance, first in a letter dated 15 October 2024 and supplemented since. The mandate covers transactions between businesses established in Germany (B2B). Invoices to private customers are not affected.

What is an e-invoice?

An e-invoice is an invoice in a structured electronic format that enables automated processing and complies with the European standard EN 16931. What matters is the machine-readable data set, not how the invoice looks.

• XRechnung: pure XML format, the German implementation of EN 16931. Not human-readable without a viewer.
• ZUGFeRD / Factur-X: hybrid format, a PDF with embedded XML. ZUGFeRD from version 2.0.1 is accepted, except for the MINIMUM and BASIC-WL profiles. If image and XML differ, the XML part prevails.
• Other formats (e.g. EDI): permitted if issuer and recipient agree on them and the invoice data can be correctly converted into an EN 16931-compliant format.

A PDF invoice, a scan or a photo, on the other hand, is not an e-invoice but an "other invoice" (sonstige Rechnung).

Deadlines and transitional rules at a glance

Exemptions: small-amount invoices up to €250 (gross) and travel tickets can still be issued in any form. Certain VAT-exempt transactions and small businesses (Kleinunternehmer) as issuers are also exempt.

The €800,000 threshold refers to the company's total turnover in the previous year, so turnover in 2026 decides the obligation in 2027. For a construction firm, that line is crossed quickly.

What the mandate means for construction firms

Incoming invoices. Large building-material merchants and manufacturers will switch by 2027 at the latest, so the volume of XRechnung and ZUGFeRD files in your invoice inbox will rise sharply. The file has to be read, checked and archived in its original format; a printout of the visual representation is not enough for archiving.

Progress and final invoices. Invoices to general contractors, developers or commercial clients are B2B invoices. This applies to every progress invoice (Abschlagsrechnung) as well as the final invoice (Schlussrechnung), which lists the progress payments received together with their tax amounts. Measurement sheets, time sheets or site diaries can be attached to the e-invoice. Check with your software vendor how your system represents progress and final invoices in the format.

§13b invoices (reverse charge). Subcontractor invoices for construction services where you, as the recipient, owe the VAT are also covered. The invoice shows no VAT and must state that the recipient is liable for the tax; e-invoice formats provide a dedicated tax category for this. Check that your subcontractors represent this correctly.

Public clients. Firms that build for federal, state or municipal clients already know XRechnung from public procurement, and that experience carries over to B2B.

Private customers. Construction work for private homeowners is not covered by the e-invoicing mandate. The existing obligation to issue an invoice for services connected with a property remains unaffected.

Checklist for construction firms

1. Check 2026 turnover: does the issuing obligation apply to you from 2027 or only from 2028?
2. Define the receiving channel: one central email address or portal for incoming invoices that you communicate to your suppliers.
3. Clarify incoming processing: can your system read XRechnung and ZUGFeRD, check them and match them with order and delivery note?
4. Check archiving: is the original file stored unchanged and in line with German bookkeeping rules (GoBD)?
5. Switch outgoing invoices: can your billing produce progress and final invoices as e-invoices, including attachments?
6. Test §13b cases: are reverse-charge invoices to and from subcontractors created and recognised correctly?
7. Inform suppliers: which formats do you expect, and to which address should they go?
8. Involve your tax adviser: agree on transitional rules, special cases and process documentation.

Common misconceptions

• "A PDF by email is an e-invoice." No, without a structured data set it is an other invoice.
• "We are small, this doesn't affect us." Everyone has had to receive since 2025, and issuing is mandatory from 2028 at the latest.
• "We need Peppol." No transmission channel is prescribed; email is enough.
• "With e-invoices, checking is done automatically." The format makes data readable, not correct. Whether quantity, price and terms are right only shows when matched against order and delivery note; see the four-way match.

How Streckenheld helps

Streckenheld reads every incoming invoice with AI, whether PDF, scan, photo or email, and matches it against the order and delivery note. Hybrid ZUGFeRD and Factur-X invoices are read like PDFs. Native processing of XRechnung XML is available on request. During the transition, paper, PDF and e-invoices therefore go through the same checking process, and deviations become visible before payment, which also helps you meet early-payment deadlines; see early-payment discount (Skonto).

Learn more on the e-invoicing for construction firms and invoice verification pages.