Invoices from three inboxes, PDFs as attachments, paper receipts on the desk and an approval process that mostly consists of chasing people: in many companies, invoice processing is one of the biggest time sinks in administration. Germany’s e-invoicing mandate is an extra reason to rethink the workflow. This guide shows how to automate invoice processing – step by step, traceable and with clear ownership of the approval.
Why it’s urgent now: the e-invoicing mandate
With the Growth Opportunities Act (Wachstumschancengesetz), Germany made electronic invoices mandatory for domestic B2B business. The switch happens in stages:
- Since 1 January 2025: all companies must be able to receive and process e-invoices.
- Until the end of 2026: paper and PDF invoices may still be sent (other electronic formats only with the recipient’s consent).
- From 1 January 2027: companies with more than €800,000 in prior-year revenue must issue e-invoices.
- From 1 January 2028: the obligation to issue e-invoices applies to all companies.
Only a structured format under the European standard EN 16931 counts as an e-invoice – for example XRechnung (pure XML) or ZUGFeRD from version 2.0.1 (a PDF with embedded XML). A plain PDF is no longer an e-invoice. There are exceptions, for example for small invoices up to €250.
Note: this article gives a practical overview (as of September 2026) and is not tax advice. Please clarify details with your tax advisor.
The good news: structured invoice data is ideal for automation. If you have to make the switch anyway, you can improve the whole process behind it at the same time.
Step 1: Understand the current process
Before a single line is automated, it pays to take an honest look at today’s workflow. Answer these questions together with the people involved:
- Through which channels do invoices arrive – email, post, supplier portals?
- Who checks the content (was the service received?) and who checks the figures (amounts, tax, bank details)?
- Where do invoices wait the longest – and why?
- Which exceptions come up regularly: credit notes, partial invoices, missing order numbers?
Map the workflow once from start to finish, including handovers. It usually becomes clear quickly that typing isn’t the biggest problem – it’s the searching, chasing and waiting.
Step 2: Capture documents with AI
Today there are two ways to capture invoices, and they work well together:
Read e-invoices directly
XRechnung and ZUGFeRD already contain the invoice data in machine-readable form. It doesn’t need to be “recognized”, just taken over correctly and validated. What matters is that your system treats the structured part as authoritative and shows it in a human-readable way.
Process PDFs and paper receipts with AI
For all invoices that don’t (yet) arrive in a structured format, AI can extract details such as supplier, invoice number, date, amounts and tax rates from the document. Modern models also cope with changing layouts. The key is a plausibility check: do net, tax and gross add up? Is the bank account known? Does the order exist?
If a value is uncertain, the workflow flags the invoice for review instead of guessing. This exact combination of AI and fixed rules is what makes the automation reliable.
Step 3: Automate approval workflows
This is often where the biggest potential lies. A good approval workflow:
- automatically assigns the invoice to the responsible person – by cost center, supplier or amount,
- sends a friendly reminder when an approval is pending,
- escalates to a deputy after a set time,
- documents every decision in a traceable way.
Important: the financial sign-off stays with you. The automation prepares, sorts and reminds – a human makes the decision. That’s not only safer, it also increases acceptance in the team.
Step 4: Connect to accounting
Approved invoices should reach your accounting team or tax advisor without being typed in again. Typical options are APIs to accounting software, a structured export or handing over to existing document portals.
Keep archiving in mind: the e-invoice must be stored in its original format in an audit-proof way, including the XML file. Invoices count as accounting records; in Germany the retention period for them was shortened to eight years in 2025. The GoBD principles still apply.
Pitfalls to avoid
- Only switching the format: if you can receive XRechnung but leave the workflow behind it unchanged, you give away most of the benefit.
- Ignoring exceptions: credit notes, down payments and invoices without an order reference need their own clear path.
- Too much at once: start with one invoice channel or one group of suppliers, then expand.
- No KPIs: measure beforehand how long an invoice takes from receipt to approval – that’s the only way to see the effect later.
- Unclear ownership: decide who handles exceptions and who owns the workflow on the business side.
Frequently asked questions
Is it enough to print e-invoices as PDFs and process them as before?
No. The e-invoice must be stored in its original format. Printing it and processing it manually also throws away the advantage of structured data.
Do we need new accounting software for this?
Not necessarily. Existing systems can often be extended with receipt, validation and approval. What makes sense depends on your system landscape.
How quickly can a first workflow be automated?
That depends on scope and interfaces. A clearly scoped pilot – for example one inbox or one group of suppliers – with KPIs agreed upfront has proven to work well.
Conclusion
The e-invoicing mandate is more than a question of format. It’s a good reason to simplify the entire invoice process: automate capture, steer approvals clearly and connect accounting cleanly. You can see what this can look like in practice under Use cases: invoice processing. If you’d like to discuss your invoice process, write to us – or read how we build AI agents and automations.
