From 2030 at the latest, a digital reporting system will be introduced in Germany, which will fundamentally change the way companies submit their VAT data to the tax authorities. The basis for this is already being laid today with the E-invoicing obligation placed, which applies from January 2025. Anyone who considers both topics separately risks costly renovations under time pressure.

What is the digital reporting system?

The digital reporting system is the next stage in Germany's tax digitisation. It obliges companies to automatically and promptly submit VAT-relevant data to the tax authorities from e-invoices. Unlike before, the periodic, manual consolidated submission is eliminated. Instead, the tax return is generated directly as part of the invoicing process, without an additional manual step.

The reporting system is not an isolated German development but is embedded within the European ViDA Initiative ("VAT in the Digital Age"), which will be binding for all EU Member States from 2030. Germany must design its national reporting system to be compatible with European requirements, particularly with regard to cross-border B2B transactions.

The Roadmap: From E-invoicing Mandate to Reporting System

The introduction of the reporting system follows a staggered roadmap, which began in 2025:

2025: Reception obligation. As of 1 January 2025, all German companies in the B2B sector are obliged to, Receive e-invoices and to be able to process.

2027: E-invoicing obligation for larger companies. From 2027, companies with a previous year's turnover of more than €800,000 will be required to issue e-invoices. dispatch.

2028: Dispatch obligation for everyone. From 2028, the shipping obligation will apply to all German companies without exception.

2030: Reporting System and ViDA. No later than 1 July 2030, companies will have to report VAT-relevant data automatically and close to the transaction to the tax authorities. The previous summary report will be abolished.

The Electronic Invoice Association clearly stated in its strategy paper from May 2026: Those who set up e-invoicing correctly today are already laying the technical foundation for the reporting system. Both topics must be considered together from the outset.

How does the reporting system work technically?

The reporting system is based on the "create once, use many times" principle. The e-invoice will be created as before and transmitted to the recipient. In parallel, the system will automatically extract the tax-relevant core data and forward it to a central receiving office of the tax authorities. For the company, this involves no additional work step.

Technically, the key players are predominantly invoice providers and platform operators. They handle validation, conversion, routing, and the automatic forwarding of reporting data. For companies, this means the complexity of the reporting system is consolidated with the service provider, not within their own company.

4-Corner Model and 5-Corner Model: The Two Approaches

For the technical implementation of the reporting system, there are fundamentally two established models:

The 4-Corner Model

The 4-Corner Model is the basic model for e-invoice exchange via a network of service providers, such as Peppol. The four corners are: Sender (Corner 1), Sender's Service Provider (Corner 2), Receiver's Service Provider (Corner 3), and Receiver (Corner 4).

The sender hands over its e-invoice to its provider, or invoice data, so that the provider can generate and validate the e-invoice, convert it into the required format, and forward it via the network to the recipient's provider. The recipient's provider then delivers the invoice to the recipient. The process is fully automated, standardised, and enables technical acknowledgements of receipt, as well as functional end-to-end confirmations.

The 4-Corner Model offers flexibility through the use of different service providers, reduces errors through standardised exchange, and increases efficiency through complete automation of invoice processing.

The 5-Corner Model

The 5-Corner Model expands the 4-Corner Model to include a fifth corner: the tax authority (Corner 5). In this model, the service providers on the sender and receiver sides transmit the core tax-relevant data directly to the tax administration in parallel with the exchange of invoices.

The key advantage: The tax notification becomes part of the ongoing invoicing process. At the same time, the tax authority receives the data close to the transaction and can use it for risk analysis and fraud prevention.

The 5-Corner Model is favoured by several EU countries, including France and Belgium. It is considered the most future-proof architecture in the context of ViDA, as it combines e-invoicing exchange and tax reporting within a single technical process.

What the reporting system specifically offers companies

Experience from countries that have already introduced reporting systems proves the economic benefits. According to the strategy paper of the electronic invoicing association, companies can achieve up to 31 percent lower processing costs by combining e-invoicing and automated reporting systems.

Added to this are strategic advantages: better planning reliability through real-time data, greater transparency of open receivables and liabilities, and a significantly more robust data basis for internal financial processes.

What companies should do now

The most important lesson learned from the introduction of reporting systems in other countries is: those who start late pay double. Companies that build their e-invoicing solutions today without considering the reporting system will have to completely overhaul this infrastructure under time pressure in a few years.

Three questions companies should ask themselves now:

Is the chosen e-invoicing solution EN-16931 compliant? The European standard EN 16931 is the technical basis for all interoperable e-invoicing formats and a prerequisite for compatibility with the reporting system.

Are ERP, financial accounting, and DMS fully integrated? The reporting system only works with a continuous data flow without media breaks. Standalone solutions lead to problems.

Does the solution support the Peppol network? Peppol is the preferred infrastructure for e-invoicing exchange in the EU and will also play a central role in the context of the German reporting system.

Conclusion

The digital reporting system is not an abstract vision of the future, but a concrete legal requirement with a clear timetable. The foundation is being laid today. While the deadlines may still seem a few years away, what is built today is crucial. Those who set up the e-invoicing infrastructure correctly now will meet the legal requirements from 2028 and be prepared for 2030 without additional effort.

About ivi

ivi is the E-Invoicing Platform der SGH Service GmbH and connects e-invoicing and reporting systems in a single process. The platform integrates with existing ERP, financial accounting, and DMS systems and is designed for the technical requirements of the German reporting system and ViDA. 2028 is coming sooner than you think, and we will show you how to create the right foundation now.

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Sources: Billentis Market Report 2026 „Riding the Tornado"; VeR Strategy Paper „Efficient Implementation of the Reporting System", May 2026; EU Commission ViDA Initiative 2022/2025.