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The European Union’s (EU’s) two largest economies – France and Germany – have recently announced they will be delaying the implementation of mandatory B2B e-invoicingElectronic invoicing - widely referred to as e-invoicing - is the exchange of a digital document between a supplier and a buyer. E-invoices are issued, transmitted and received in a structured data format that enabled automatic and electronic processing. They contain data in a machine-readable format so that an AP system can read an invoice without manual data entry, leading to faster and more efficient invoicing. regulations.
While both countries remain on track to roll out e-invoicing for all B2B transactions, businesses will now have at least an extra 12 months before they have to comply; time that could be wisely spent putting in place the required infrastructure and processes to integrate e-invoicing within their existing systems.
Here are the details behind each nation’s delay:
France
On 28th July, the French Ministry of Finance announced its implementation of e-invoicing and e-reporting would be delayed.
It was due to make the following processes mandatory:
• E-invoices on domestic B2B transactions
• E-reporting on B2C and international B2B transactions
Both systems were planned to be introduced in a phased approach starting in July 2024.
All organisations would have been required to receive e-invoices for purchases from 1st July next year. For sales, the same date would apply initially for large businesses only, before medium-sized companies were required to use B2B e-invoicing in January 2025 and small firms followed suit in January 2026.
However, this schedule has now been cancelled, with the French parliament set to discuss a new timeline for implementation as part of its scheduled Finance Act for 2024.
While no new date has yet been set, some reports suggest it will be 2026 before businesses are mandated to use e-invoicing in B2B transactions.
Germany
Germany has confirmed its adoption of mandatory e-invoicing for domestic B2B supplies will be postponed until 1st January 2026; delayed from its original introduction date of 1st January 2025.
However, from January 2025, businesses will be permitted to use e-invoices on a voluntary basis.
It comes as the European Commission submitted a request for mandatory e-invoicing on behalf of Germany to the Council of the European Union, which was subsequently ratified.
This grants permission for Germany to impose real-time e-invoicing for the first time, although it immediately confirmed the 12-month delay to its intended schedule. Germany will impose e-invoices until the end of 2027, at which point there will be a review of the scheme.
Paper or PDF invoices may still be issued until the official launch of e-invoicing, at which point e-invoices will be redefined as structured e-invoices.
During the voluntary period in 2025, the current invoice rules, disclosures and timelines will apply to e-invoices.
What’s the latest with ViDA?
The delays in France and Germany come shortly after an amendment to the EU’s VAT in the Digital Age (ViDAViDA or 'VAT in the Digital Age', is an EU initiative proposed by the European Commission that seeks to modernise and harmonise VAT processes for member states, by embracing new technologies. It is aimed at updating processes for the management of VAT, and reduce the VAT gap and fraud. The proposal also aims to address challenges in the area of VAT raised by the development of the platform economy.) was tabled calling for a one-year delay to its implementation.
ViDA is a wide-ranging scheme designed to tackle new inequalities in the traditional VAT system caused by the rise of online marketplaces and digital platforms.
It will introduce a series of reforms designed to ensure businesses – both those trading only online and traditional sellers – are taxed fairly; one of which is the EU-wide implementation of mandatory e-invoicing by 2028.
What do businesses need to do next?
Investing in a solution to process, complete and submit e-invoices is a clear priority for many businesses as we edge towards widespread mandatory e-invoicing across Europe and beyond.
But at Innovate Tax, we believe some organisations are overlooking the critical nature of master data.
Having a shiny, top-of-the-range e-invoicing solution is one thing, but if you haven’t got clean, complete data that is correctly formatted and ready to use you won’t see the results. As we often say, if you put garbage in you must expect garbage to come out.
The proposed delays – both to e-invoicing in France and Germany and the overall ViDA project – provide a lifeline to companies that have yet to plan and build for a future in which data is king and e-invoicing is an essential part of the tax journey from source to submission.
