Where it started: the February 2025 consultation
On 13 February 2025, HM Revenue & Customs (HMRC) and the Department for Business and Trade (DBT) published a 12-week consultation, “Promoting electronic invoicing across UK businesses and the public sector”. It closed on 7 May 2025 and drew 342 responses from businesses, tax advisers, software providers and representative bodies.
The consultation asked four broad questions: which e-invoicing model the UK should use, whether adoption should be voluntary or mandatory, what the scope of a mandate should be, and whether e-invoicing should be paired with real-time digital reporting to HMRC.
It also set a clear definition. E-invoicing is the digital exchange of invoice data directly between the buyer’s and supplier’s financial systems, even when those systems differ. Invoices in PDF or Word format, images such as JPEG, HTML invoices on a web page or in an email, and faxed images are not e-invoices for this purpose.
What the government decided in November 2025
The government’s response was published on 26 November 2025, alongside Budget 2025. The Budget document states that from April 2029, businesses will be required to issue all VAT invoices as e-invoices, with an implementation roadmap to follow. The response explains the reasoning: a voluntary model would not reach enough businesses for everyone to benefit from the network effect.
| Question | Decision | Still open |
|---|---|---|
| Mandatory or voluntary? | Mandatory for all VAT invoices from April 2029 | Milestones to be set in the roadmap |
| Scope | Business-to-business and business-to-government transactions where VAT is due | Sector-specific needs (for example construction, financial services) |
| Consumers | Not in scope: VAT invoices are not required for sales to consumers | - |
| Model | Decentralised: no central government platform | Rules for software providers |
| Standard | UK standards enabling interoperability will be developed | Existing standard or a UK-specific one |
| Real-time reporting | Not introduced in 2029 | May follow once e-invoicing is well established |
On standards, the response is careful. The government says it will review the risks and benefits of adopting an existing standard or designing a UK-specific one. Many respondents asked for international frameworks such as Peppol and the European standard EN 16931, to keep cross-border trade simple. Those already exist in the UK public sector: bodies covered by the Public Procurement Act 2023 (as the response names it) must accept e-invoices that comply with BS EN 16931, and NHS Supply Chain requires its suppliers to invoice over the Peppol network.
Smallest businesses. Because the mandate attaches to VAT invoices, the response notes that many of the smallest businesses, which are not required to register for VAT and choose not to, will not be obliged to adopt e-invoicing. If you are VAT-registered, plan on being in scope.
What has happened in 2026 so far
The response promised detailed collaboration with stakeholders from January 2026. According to the Office of the Small Business Commissioner, a stakeholder group of accountants, business representative organisations and software providers was set up to meet monthly from January to June 2026, alongside an expert working group on technical elements, deep dives with sectors that have specific needs, and webinars for businesses.
HMRC’s 2026 update to its Transformation Roadmap confirms that policy development and technical workshops have been launched with DBT and industry. It repeats the commitment: e-invoicing for all VAT invoices from April 2029, with a roadmap published at Budget 2026 setting out the milestones to implementation.
On 31 July 2026, the Chancellor told the Treasury Committee that the Budget will be presented on 28 October 2026. As at 18 October 2026, the roadmap and the technical standard have therefore not yet been published. We will update this article when they are.
The timeline at a glance
| Date | Milestone |
|---|---|
| 13 February 2025 | Consultation published by HMRC and DBT |
| 7 May 2025 | Consultation closes (342 responses) |
| 26 November 2025 | Budget 2025: mandate for all VAT invoices announced; government response published |
| January to June 2026 | Stakeholder co-design work on the roadmap |
| 28 October 2026 | Budget 2026: implementation roadmap and standards due |
| April 2029 | All VAT invoices must be issued as e-invoices |
What UK businesses should do now
Two and a half years sounds like plenty of time, but invoicing touches your software, your customers’ systems and your cash flow. A few steps cost nothing today and will make 2029 easier.
- Take stock of how you invoice. Word templates, PDFs by email and paper will all have to go for VAT invoices. Note which systems create your invoices and who receives them.
- Ask your software provider about e-invoicing. Several Making Tax Digital providers already offer it, according to the response. Ask whether they support Peppol and EN 16931 today, and what they plan once the UK standard is known.
- Clean your customer data. Correct legal names, addresses and VAT numbers will matter more when invoices are read by machines rather than people.
- Get your invoice content right now. An e-invoice still has to carry everything a VAT invoice needs: see what a VAT invoice must include.
- If you sell to the EU, start earlier. Several EU countries already require e-invoices, and a Peppol-ready tool helps on both sides of the Channel: see selling to EU customers after Brexit.
- Watch Budget 2026. The roadmap will set the standard and the milestones; do not buy a long contract for a proprietary format before then.
There is a cash-flow upside too. The government’s case for e-invoicing rests partly on faster payment, and the consultation press release cites an NHS trust where e-invoices were paid almost twice as quickly as paper ones. If late payment is already a problem, our guide to chasing a customer who is not paying and the overview of our e-invoicing approach may help.
Frequently asked questions
When does e-invoicing become mandatory in the UK?
From April 2029, businesses will be required to issue all VAT invoices as e-invoices, as announced at Budget 2025. The detailed roadmap is due at Budget 2026, on 28 October 2026.
Does it apply to sales to consumers?
No. The mandate covers business-to-business and business-to-government transactions where VAT is due. VAT invoices are not required for sales to consumers.
Will a PDF invoice still be acceptable?
Not as an e-invoice. The consultation states that PDF or Word invoices, images, HTML invoices and faxes are not e-invoices. Once the mandate applies, VAT invoices will need to be issued in the specified electronic format.
Will the UK use Peppol?
Not decided. The government will review whether to adopt an existing standard or design a UK-specific one. Many respondents favoured Peppol and EN 16931, which are already used in parts of the UK public sector.
Will HMRC receive my invoices in real time?
Not in 2029. The government will consider some form of real-time reporting later, once e-invoicing is well established, building on the same infrastructure.
Sources
- GOV.UK — Promoting electronic invoicing across UK businesses and the public sector (consultation, HMRC and DBT) (gov.uk)
- GOV.UK — Consultation response (26 November 2025) (gov.uk)
- GOV.UK — Government sets out plans for e-invoicing overhaul to cut paperwork (13 February 2025) (gov.uk)
- GOV.UK — Budget 2025 (gov.uk)
- GOV.UK — Budget 2025: Overview of tax legislation and rates (gov.uk)
- GOV.UK — HMRC Transformation Roadmap: update 2026 (gov.uk)
- GOV.UK — Chancellor letter to the Treasury Select Committee: Budget 2026 date (31 July 2026) (gov.uk)
- Office of the Small Business Commissioner — Spotlight on: e-invoicing (smallbusinesscommissioner.gov.uk)
This article summarises the official texts to help you get organised. It is not a substitute for personalised advice from your accountant.