Bookkeeping Software in Germany: A Guide for Small Firms
Short answer: German bookkeeping software for small businesses connects your bank account, captures receipts by phone, matches payments and hands data to ELSTER or your tax adviser. Regular prices for common tools run from about 8 to 35 euros net a month, according to the vendors. Since 2025, receipts must be kept for eight years and books for ten.
The shoebox full of receipts is not a joke in German small business. Once a quarter it goes to the tax adviser, gets sorted and typed in, and the bill arrives weeks later. Much of that work is something software does in seconds.
For international founders the shoebox has an extra twist: German tax language. Going digital won’t make you an accountant. It does mean receipts, bank transactions and invoices end up in one place, matched up, and your adviser works with data rather than paper.
What digital bookkeeping looks like in practice
The core is linking three data sources: your business account, your receipts and your outgoing invoices. Good tools pull bank transactions automatically, suggest matching receipts and recognise recurring payments.
- Connect the accountLink your business account to the software through the bank interface.
- Capture receiptsPhotograph paper receipts in the app, forward PDF invoices by email.
- MatchEvery transaction gets its receipt. The software suggests matches.
- Write invoicesIn the same tool, as e-invoices from 2027 or 2028.
- Hand overVAT return via ELSTER, or data export to your tax adviser.
Half an hour a week keeps quarter-end painless. Doing it once a year is the same work as with paper, just on a screen.
Separate first, then digitise
Before setting up software, open a separate account for the business. German law doesn’t require sole traders to have one. In practice you want it anyway, or the software will flag every private grocery payment as an open item.
A cheap second current account often does the job. Some banks prohibit business use of personal accounts in their terms, so check. What matters is that business payments land there and private ones don’t.
Next, create a dedicated address for invoices, something like invoices@yourdomain. Suppliers, online shops and your phone provider send bills there, and many tools can read that inbox directly. Once e-invoices arrive, you will be glad you did.
Capturing receipts by phone
Snapping receipts with your phone is the easiest way to capture paper. To hold up in an audit, the whole receipt must be legible: date, amount, VAT rate and issuer. Thermal till receipts fade over time, so photograph them soon rather than at year-end.
Business meal receipts need the occasion and the names of those present, a German requirement that surprises many newcomers. Most apps have fields for this. Fill them in right after the meal, because three months later nobody remembers who was at the table.
Receipts from abroad count as accounting vouchers too. If you are VAT-registered and buy services from businesses in other EU countries, the reverse-charge mechanism usually applies, and your tool should handle those entries. Ask about it during the trial.
What the GoBD require
The GoBD are a Federal Ministry of Finance circular setting out how digital books and records must be kept so the tax office accepts them. The name is a mouthful: principles for the proper keeping and storage of books, records and documents in electronic form.
For small businesses the key points are simple. Receipts must be recorded completely, promptly and unalterably. Changes have to stay traceable. Documents that arrive digitally, such as XML e-invoices or PDF invoices from an online shop, must be stored digitally. A printout is not enough.
Paper receipts may be destroyed after scanning if the replacement scanning process is described in a procedure document (Verfahrensdokumentation). For a small business that is often one page.
- Who captures receipts, and how often?
- Which app or device is used for scanning?
- Where are files stored, and who has access?
- How do you check a scan is complete and legible?
- When are paper originals destroyed, and which are kept?
- How are e-invoices archived in their original format?
Retention periods since 2025
Germany’s Fourth Bureaucracy Relief Act shortened retention for accounting vouchers. Since 2025, section 147(3) of the Fiscal Code says:
Source: Section 147(3) German Fiscal Code, version from 2025
The clock starts at the end of the calendar year the document was created. An invoice from March 2026 can be deleted at the earliest in early 2035. If you cancel your software, the data must still be accessible, so check the export options before you sign up.
Which software for whom
Tools for small businesses differ mainly in whether they only write invoices or also handle bookkeeping with the profit statement (EÜR) and VAT. Two widely used vendors and their regular monthly prices net of VAT, from their pricing pages in October 2026:
Source: lexware.de and sevdesk.de pricing pages, October 2026. Both were running time-limited discounts when checked.
sevdesk also has a free plan with three invoices or e-invoices a month, enough for a freelancer with two or three clients to try it out.
If you work with a Steuerberater, ask them first. Many firms run on DATEV and prefer DATEV Unternehmen online or an export from your tool. The best software is the one whose data your adviser can use without rework. English-speaking advisers exist in Berlin, but their software stack will still be German.
Small business scheme, EÜR, balance sheet
Under the Kleinunternehmer scheme (section 19 VAT Act), bookkeeping is simplest: no VAT returns, and a profit statement (EÜR) is enough. Since 2025 the threshold is 25,000 euros turnover in the previous year and 100,000 euros in the current year.
If you charge VAT, you file advance returns. Since 2025 you can file quarterly if last year’s VAT liability was no more than 9,000 euros, and the tax office can waive returns entirely at 2,000 euros or less. New businesses used to file monthly for their first two years automatically. That rule is suspended for 2021 to 2026, and the expected tax decides instead. Ask your adviser what applies from 2027.
GmbHs and UGs always prepare balance sheets. Sole traders and partnerships without merchant status only have to under section 141 of the Fiscal Code once turnover exceeds 800,000 euros or profit 80,000 euros. By then, your books belong with a tax adviser.
- Software 12 × €21.90
- €262.80
- Own time 52 × 0.5 hours
- 26 hours
- Tax adviser for the annual return only
- on quote
- Software cost per year, net
- €262.80
Assumptions: Lexware Office L at the regular price, 30 minutes of receipt work a week. Own time not priced.
Connecting till, shop and books
The real saving comes from never typing data twice. Many till and shop systems connect to common bookkeeping tools or to DATEV. Check that before you buy. Till rules are covered in our guide to POS systems and the TSE, and invoice deadlines in e-invoicing in Germany.
Where no connector exists, for instance between an industry tool and your bookkeeping software, it is manual work or a small integration project. A team for data analytics and integration can tell you whether that pays off. Advice on the switch can be part-funded through the BAFA consulting grant.
Your next step: ask your tax adviser which tool they prefer to receive data from, and open a trial account there. Connect your business account and capture this month’s receipts. After four weeks you will know whether the routine fits.
Questions people ask
Is there German bookkeeping software in English?
Some tools offer English interfaces, but most German-market products are German-first, and tax terms, forms and ELSTER exports remain German. Test the interface in the free trial before committing.
Can I throw away paper receipts after scanning?
Under conditions, yes. The GoBD allow replacement scanning if the process is described in a procedure document and scans are complete, legible and stored unalterably. Some documents must still be kept in the original.
Do I need a Steuerberater?
Not necessarily. Many freelancers and sole traders file their profit statement (EÜR) and VAT returns themselves with good software. GmbHs and UGs, which must produce balance sheets, almost always work with a tax adviser.
When do I have to keep double-entry books?
Companies such as GmbH and UG always do. Sole traders and partnerships without merchant status must under section 141 of the Fiscal Code once turnover exceeds 800,000 euros or profit 80,000 euros a year. Freelancers are not caught by these thresholds.
