The Gap Nobody Is Talking About
Most German finance teams have spent the last twelve months getting ready to receive e-invoices. Mailbox set up, parsing rules in place, accounts payable workflows updated. The January 2025 receiving obligation came and went, and most companies handled it.
The problem now sitting in plain sight is the other half of the mandate. Your ERP can read an incoming ZUGFeRD invoice from a supplier just fine. It cannot produce one for your own clients. And the deadline for sending compliant e-invoices in Germany is January 2027 for businesses above the turnover threshold, with France moving to a sending obligation for all companies in September 2027.
If you sell to German B2B clients, this affects you. If you sell to French B2B clients, this also affects you. The window to close the gap is narrowing.
Why ERP Systems Handle Incoming But Not Outgoing E-Invoices
ERP systems were built around accounts payable. Decades of investment went into making it easy to receive a supplier invoice, match it to a purchase order, route it for approval, and post it to the ledger. Outgoing invoices, by contrast, were always treated as something simple: generate a PDF, print or email it, done.
That assumption no longer holds. ZUGFeRD requires a PDF/A-3 wrapper with an EN 16931 compliant CII XML payload embedded inside the file structure. XRechnung requires pure XML in either CII or UBL syntax, validated against the EN 16931 semantic data model and a German national rule set. Neither of these is something a typical ERP report writer was designed to emit.
So you end up with a strange asymmetry. The system you bought to manage your finances can ingest a structured e-invoice from any of your suppliers, but it cannot produce one for any of your clients.
The Specific Systems Where the ERP Outgoing E-Invoice Gap Shows Up
The ERP outgoing e-invoice gap is not a problem with one specific vendor. It shows up across most of the systems German and French SMEs actually run.
SAP ECC and S/4HANA. Standard SAP invoice output is a non-compliant PDF. To emit ZUGFeRD or XRechnung, you need either SAP Document and Reporting Compliance (DRC), which is a paid module with its own implementation timeline, or a third-party add-on. Even with DRC, scoping, configuring, and testing the outgoing flow is a months-long project, not a switch you flip.
Microsoft Dynamics 365 Business Central and Dynamics NAV. Native ZUGFeRD and XRechnung output landed in Business Central version 26.3, the 2025 release wave 1 update that rolled out to sandbox in April 2025 and to production environments in late July 2025. Version 26.3 introduced the unified E-Document framework for the German localisation, with XRechnung (UBL), Peppol BIS 3 DE, and ZUGFeRD selectable as outgoing document formats. Before 26.3, Business Central could send Peppol BIS but did not generate XRechnung or ZUGFeRD natively. Every Dynamics NAV version still requires a third-party AppSource extension. If your organisation runs a Business Central version older than 26.3 or any Dynamics NAV release, and your upgrade path runs through 2027, you have a real outgoing e-invoice compliance gap to close.
Older and legacy accounting systems. Anything that predates EN 16931, which was published in 2017, has no native concept of structured e-invoicing. Older Sage versions, older Lexware editions, custom-built ERPs developed in-house ten or fifteen years ago, and any sector-specific tools whose vendors are not actively shipping compliance updates all fall in this bucket. Bolting on EN 16931 output is not a small task.
Subsidiaries of larger groups. A French subsidiary of a German parent often runs a copy of the parent's ERP, configured for the parent country's needs. The subsidiary then faces a French sending obligation in September 2027 with no localised output and no priority on the parent's IT roadmap. The same pattern repeats with German subsidiaries of non-EU groups.
Companies that split billing and accounting. Many SMEs use a separate billing tool to generate quotes and invoices, then export the data into an accounting tool for bookkeeping. The billing tool produces PDFs, the accounting tool ingests data, and neither one was designed to emit a compliant ZUGFeRD or XRechnung file.
If your company sits in any of those categories, this is your gap to close.
What the Mandate Actually Requires From You as a Sender
The German rules are specific and worth reading carefully.
In Germany, the B2B sending obligation for domestic transactions kicks in on 1 January 2027 for businesses whose total turnover in the previous calendar year exceeded 800,000 euros. From 1 January 2028, the e-invoicing obligation extends to all remaining German businesses regardless of turnover. The legal basis is the Wachstumschancengesetz (Growth Opportunities Act), which made e-invoicing the default method for B2B invoices in Germany from 1 January 2025 onward. Penalties under §26a UStG run up to 5,000 euros per violation, applied per non-compliant invoice. The German rules have no grandfathering for invoices already in transit and no carve-out for SMEs once the 2028 deadline passes.
What counts as a compliant e-invoice under the German rules is also specific. ZUGFeRD invoices must be a PDF/A-3 with embedded CII XML at the EN 16931 profile level or higher. XRechnung must be pure XML in CII or UBL syntax, conforming to the XRechnung 3.0 CIUS. A standard PDF, even one with all the right fields visible to a human reader, does not meet the requirement.
In France, the receiving obligation for all businesses goes live in September 2026. The sending obligation for all businesses, including auto-entrepreneurs and VAT-exempt micro-enterprises, follows in September 2027. France routes invoices through certified platforms (PDPs) and accepts Factur-X among other formats.
There is also a quieter pressure that does not wait for the legal deadline. German clients with automated AP systems are already rejecting non-compliant invoices today. If a client's system is configured to extract embedded CII XML, your standard PDF will sit in a manual review queue at best and be returned at worst. Compliance is becoming a procurement requirement before it becomes a legal one.
The Approaches Companies Are Taking to Solve This
Three paths are common right now.
Extend the existing ERP. Buy SAP DRC, install a Business Central AppSource extension, or commission a custom development project on your legacy system. This keeps everything in one platform, which is appealing if your finance team is already comfortable in that platform. The downside is cost and timeline. A DRC implementation is rarely fast, and a custom development on a legacy ERP is rarely cheap. If the deadline is January 2027 and you are starting now, this path is tight.
Replace the ERP entirely. Migrate from your current system to a modern platform with native EN 16931 output. This makes sense only if you were already planning a replacement for other reasons. Treating an ERP migration as a compliance project is the wrong shape: too slow, too risky, too expensive. You will miss the deadline.
Use a dedicated outgoing invoicing tool alongside the ERP. The ERP keeps doing what it does well, which is accounts payable, ledger, payroll, reporting. A separate tool handles outgoing client invoices in the formats the mandate requires: ZUGFeRD for the German B2B mainstream, XRechnung for German B2G submission through ZRE or OZG-RE, Factur-X for French clients, Peppol BIS for cross-border. This is the path that closes the outgoing e-invoice compliance gap fastest. There is no IT integration project, no module rollout, no platform replacement. You generate compliant invoices from the new tool, post the resulting financial entries to your existing system through the normal export and journal flow, and you are done.
The third path is what most SMEs we talk to are picking, simply because the 2027 sending deadline does not move and the other two options take too long. It is also the only realistic option for companies whose ERP cannot generate XRechnung or ZUGFeRD at all and where a vendor upgrade is not on the table.
A Practical Checklist for Companies With This Gap
Use this list as a fifteen-minute self-assessment.
- Can your current system generate a PDF/A-3 with embedded EN 16931 CII XML?
- Can it generate a pure XML file in CII or UBL for XRechnung delivery?
- Has your current invoice output been tested against an independent ZUGFeRD validator like the Facturwise validator or peppol.helger.com?
- Are any of your German clients already requesting a different format, or rejecting your PDFs?
- Do you have French B2B clients who will require Factur-X from September 2026 onward?
- Is there a budget line for a 2026 IT project to solve this, with a Steuerberater or expert-comptable involved in scoping?
- Have you mapped which categories of clients will be affected first based on the 800,000 euro turnover threshold in 2027 versus 2028?
If you cannot tick the first three boxes today, you have an open issue. The remaining boxes tell you how urgent it is.
Common Mistakes Companies Make When Facing This Gap
Assuming the PDF is compliant because it contains the right information. The mandate is about machine-readable structure, not human-readable layout. A beautifully formatted PDF with every required field labelled correctly is still not a ZUGFeRD invoice unless the structured XML is embedded inside the file.
Waiting for the ERP vendor to ship a native solution. Some vendors will, eventually. Others will not, or will charge for an extra module. The vendor's roadmap is not your deadline. By the time they ship, it may be 2028.
Treating this as an IT project rather than a finance decision. The ERP outgoing e-invoice gap is a regulatory and commercial issue first. The technology to solve it already exists; it is a matter of choosing how to deploy it. When IT owns the decision, the timeline lengthens because the work gets bundled with other projects. Finance teams who treat compliance as their responsibility tend to move faster.
Not testing the output before sending. Even when a system claims ZUGFeRD or XRechnung output, the file may not actually validate. A common failure mode is producing a PDF/A-3 with embedded XML that misses one or more EN 16931 mandatory Business Terms (BT-1 invoice number, BT-27 seller name, BT-118 VAT category code, and so on), which a sufficiently strict client AP system will reject. Run sample invoices through an independent validator before relying on the output for client billing. The Facturwise validator at /en/validate accepts ZUGFeRD, Factur-X, XRechnung, and Peppol BIS uploads and checks every Business Term against EN 16931. For deadline planning by country, see the EU e-invoicing deadlines timeline.
FAQ
Can SAP generate outgoing ZUGFeRD and XRechnung invoices natively? Not out of the box. Standard SAP ECC and S/4HANA installations produce non-compliant PDFs for outgoing invoices. Compliant output requires either SAP Document and Reporting Compliance (DRC) or a certified third-party add-on, both of which involve a configuration and testing project.
Does Microsoft Dynamics 365 Business Central support outgoing ZUGFeRD invoices by default? Only from version 26.3 onward, released in July 2025. Older Business Central versions support Peppol BIS natively but not ZUGFeRD. Every Dynamics NAV version requires a third-party AppSource extension.
Our company uses an older ERP. Do we need to replace it to comply? No. Replacing an ERP for compliance reasons alone is the wrong project shape. The standard answer is to keep the ERP for accounts payable, ledger, and reporting, and use a dedicated invoicing tool for outgoing client invoices in ZUGFeRD, Factur-X, and XRechnung formats.
What is the deadline for sending compliant outgoing e-invoices to German business clients? January 2027 for businesses whose total turnover in the previous calendar year exceeded 800,000 euros. January 2028 for all remaining businesses regardless of turnover.
Why does our ERP struggle with outgoing e-invoicing if it handles incoming invoices well? ERP architectures grew up around accounts payable. Outgoing invoices were treated as plain PDFs because that was sufficient for decades. Generating ZUGFeRD or XRechnung requires emitting EN 16931 compliant XML, which most ERP report engines were never designed to do. The technical capabilities for reading an inbound CII or UBL file and writing one are different code paths, and most ERP roadmaps prioritised the inbound side because the receiving obligation hit first.
How do I send compliant e-invoices in Germany from 2027 if my current system only produces PDFs? Either upgrade your ERP to a version that supports EN 16931 outgoing output, replace it (slow, expensive, usually overkill for a compliance-only goal), or run a dedicated invoicing tool alongside it that emits ZUGFeRD, XRechnung, Factur-X, and Peppol BIS. The third option is the fastest and the most common choice for SMEs.
Can we use Facturwise for outgoing invoices while keeping our ERP for everything else? Yes. The ERP continues to handle accounts payable, ledger, payroll, and reporting. Facturwise generates compliant ZUGFeRD 2.4, Factur-X 1.0.8, and XRechnung 3.0 invoices for your clients. Monthly DATEV CSV export is available so your Steuerberater workflow stays unchanged.
What formats does Facturwise generate for outgoing e-invoices? ZUGFeRD 2.4 and Factur-X 1.0.8 at the EN 16931 profile level, and XRechnung 3.0 in UBL syntax. All formats are generated automatically with no per-invoice configuration. Peppol BIS Billing 3.0 is also available for cross-border B2B and B2G use cases.
Is this problem only relevant for large companies running SAP? No. It affects SMEs running Business Central, subsidiaries running localised copies of a parent company's ERP, freelancers and small businesses on legacy accounting tools, and any company whose invoicing software predates EN 16931. The gap is broad.
Closing Note
If your ERP cannot generate compliant ZUGFeRD or XRechnung outgoing invoices today, the cheapest path forward is a dedicated invoicing tool that runs alongside it. Facturwise generates ZUGFeRD 2.4, Factur-X 1.0.8, XRechnung 3.0, and Peppol BIS Billing 3.0 from one account, with no ERP integration project required. Start a free trial. No credit card required, free plan available.
This article is for general informational purposes only and does not constitute legal or tax advice. Consult a qualified Steuerberater or expert-comptable for guidance on your specific situation.