ZUGFeRD or XRechnung: who needs which format

One customer asks for an "e-invoice," a public-sector client demands a different format than your mid-sized business customer, and a third customer sends an invoice back after dispatch because their system can't read it. Each of these queries costs your accounting team time, delays payment and leads to invoices being created twice. The cause is usually the same: the format question was never clarified for each customer.

What Technically Distinguishes the Two Formats

Both formats contain the invoice data in a structured form that software can read without manual re-typing. The difference lies in the packaging:

• ZUGFeRD is a hybrid format: a readable PDF with the structured data (XML) embedded in it. A person opens the PDF, and the software reads the XML.
• XRechnung is pure XML without a PDF view. A person can only see it through a viewer or software that renders it.

Both follow the European standard for electronic invoices. What matters is what the recipient can process and requires, not which format is more "modern."

A check for every invoice: Should it be read primarily by a person or processed by software? If the answer is "both," ZUGFeRD fits; if it is "software only," XRechnung is sufficient.

When the Customer Is a Public Authority or Public-Sector Client

You issue an invoice to a municipality, a state or a federal institution. Public-sector clients generally require XRechnung, often additionally with a Leitweg-ID (an identifier used to route the invoice to the right office) and submission through an invoicing portal.

Decision rule: If the order comes from a public body, ask about the format, the Leitweg-ID and the transmission channel before you send the first invoice. Enter the Leitweg-ID on the contact record, not in the free text of the invoice.

When the Customer Is a Company

A business customer usually has no mandated format, but it does have an incoming-invoice system that either processes e-invoices or does not yet do so. Ask the customer's accounts payable clerk specific questions:

1. Which formats can your system read?
2. Which address should e-invoices go to: a separate mailbox or the existing address?
3. Do you need additional information, such as a purchase order number or reference?

Decision rule: If the customer reads structured data automatically, both formats are possible; use the format they name. If they only open invoices manually, ZUGFeRD is the safe choice, because the PDF remains readable and still contains the data.

When the Customer Is a Private Individual or a Small-Volume Buyer

Private individuals are not addressees of the e-invoicing obligation in business-to-business transactions. For them, a readable PDF remains the sensible choice. Whether and when an obligation applies to your types of invoices is something to clarify with your tax advisor.

Obligations and Deadlines

The obligation to receive e-invoices and the obligation to send them apply under a statutory timetable, with transition periods. We do not state specific deadlines and exceptions here, for example for small revenues. Ask your tax advisor: From when do we have to receive e-invoices, from when do we have to send them, and which transition rule applies to us?

How This Works in Software

At Simplify-ERP, an Odoo consultancy from Stuttgart, e-invoicing is part of the Accounting work area: e-invoices in ZUGFeRD and XRechnung are generated, validated and received. You select the format per customer on the contact record. The principle applies to any software: the format is tied to the customer, not to the individual invoice, so nobody has to decide it again with every dispatch.

Assigning Your Customer List: How to Proceed

1. Export your customers along with their recent invoices.
2. Mark public-sector clients: format XRechnung, record the Leitweg-ID.
3. Ask business customers with a high invoice volume about how they process incoming invoices.
4. Set ZUGFeRD as the default for all others.
5. Store the format and the receiving address on the contact record.
6. Send one test invoice per group and have receipt confirmed.

Your Next Step

Take your five highest-revenue customers and answer these questions for each: Is it a public body? Which format can its incoming-invoice system read? Where is this recorded in our contact record? If an answer is missing, send the customer a short query today.