Problem with annexation :/
- Thread starter costantine
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This.
In all seriousness: If you are in a war with a nation and you occupy all of their provinces then you can demand annexiation (it's above demand tribute) in the peace deal.
You can also attempt to diplomatically demand annexiation of your vassals. That's never worked for me though.
Some nations are also too large for you to annex, so you must arrange a peace deal where you take a few provinces now that will weaken them so you can annex the rest later.
Welcome, costantine! 
As many beginners, you are perhaps thinking in Total War terms, a game in which annexation follows immediately after occupation. That is not how things work in EU3. In war you occupy provinces, but they are not yours before you have formalized that gain in a Peace Treaty. For example, Greece and the League might have occupied Macedonia in the Balkan Wars, but it was only in the Treaty of London that it was ultimately ceded to the League on a formal basis.
In peace-treaties, you will oftentimes be prohibited from annexing a country if it's more than four or so provinces (number depends on the abstract value of the land). Its mainly game-mechanics but it keeps with the European tradition that you do not annex great powers, but rather small satellite states of lesser import -- something else would be frowned upon. If however, the country is small enough to be annexed, the option will be clickable in the peace menu when you have occupied all of its provinces. Note that you can determine the possibility of annexation by hovering you key over the greyed-out option, even if you do not have control of every province.
It is, however, important to note that it's not always preferable to annex countries since every demand you impose without good reason (a cassus belli) negatively impact your standing in the diplomatic community. This is represented as infamy (sometimes called "badboy") which is displayed as a red flag close to you treasury icon at the top of your screen. If your infamy is too high, your ability to restabilize your country will suffer, people will start to hate you and eventually you'll be considered "Scrum of the Earth," a rogue state which anyone can attack. So don't go on a mindless killing-spree. Use diplomatic finesse to conceal your murderious intent.
As many beginners, you are perhaps thinking in Total War terms, a game in which annexation follows immediately after occupation. That is not how things work in EU3. In war you occupy provinces, but they are not yours before you have formalized that gain in a Peace Treaty. For example, Greece and the League might have occupied Macedonia in the Balkan Wars, but it was only in the Treaty of London that it was ultimately ceded to the League on a formal basis.
In peace-treaties, you will oftentimes be prohibited from annexing a country if it's more than four or so provinces (number depends on the abstract value of the land). Its mainly game-mechanics but it keeps with the European tradition that you do not annex great powers, but rather small satellite states of lesser import -- something else would be frowned upon. If however, the country is small enough to be annexed, the option will be clickable in the peace menu when you have occupied all of its provinces. Note that you can determine the possibility of annexation by hovering you key over the greyed-out option, even if you do not have control of every province.
It is, however, important to note that it's not always preferable to annex countries since every demand you impose without good reason (a cassus belli) negatively impact your standing in the diplomatic community. This is represented as infamy (sometimes called "badboy") which is displayed as a red flag close to you treasury icon at the top of your screen. If your infamy is too high, your ability to restabilize your country will suffer, people will start to hate you and eventually you'll be considered "Scrum of the Earth," a rogue state which anyone can attack. So don't go on a mindless killing-spree. Use diplomatic finesse to conceal your murderious intent.
The answer also depends on what version you are running. The answers above mainly apply to the latest version (Divine Wind). If you are only running In Nomine or some older version then you can only militarily annex countries if they own only one province (except for pagans). You would need to fight one or more extra wars to take their other provinces before the war where you could annex them.
There's also the very old turbo-annex system in Vanilla EU3. But I doubt he's playing that version.