Starting February 13, 2025, the UK government launched a 12-week consultation on standardizing and potentially mandating electronic invoicing (e-invoicing) for businesses, with a proposal expected by November 2025 and possible full implementation by 2030. The consultation will explore different e-invoicing models, mandatory vs. voluntary adoption, and integration with VAT reporting, aiming to improve efficiency and tax compliance.
UK Launches Public Consultation on E-Invoicing and Digital Reporting
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Author: Ivana Picajkić
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Fiscal subject related
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Content accuracy validation date:
27.02.2025
Content accuracy validation time:
08:39h
Starting February 13, 2025, the UK government (HMRC and the Department for Business & Trade) opened a 12-week consultation on standardizing and potentially mandating electronic invoicing (e-invoicing) for business-to-government (B2G) and business-to-business (B2B) transactions. The final proposal is expected by November 2025, with a possible full mandate by 2030.
Proposed Timeline:
- Feb 13 - May 7, 2025: Businesses, trade groups, and tech vendors submit feedback,
- June - Oct 2025: The government reviews responses and drafts the UK’s e-invoicing framework,
- Nov 2025: A formal proposal is expected in the UK Chancellor’s Autumn Budget,
- 2026-2027: Development of legal and technical specifications,
- 2028-2029: Pilot testing and phased rollout,
- 2030: Potential full implementation.
The consultation will explore:
- Standardized vs. flexible e-invoicing models (e.g., 4-corner vs. 5-corner models),
- Voluntary vs. mandatory adoption of e-invoicing,
- Timeline for businesses to prepare for a potential mandate,
- Integration with real-time VAT reporting and potential for pre-filled VAT returns.
Current UK E-Invoicing Rules:
- Businesses can already use e-invoices voluntarily for B2B transactions without HMRC approval,
- For B2G transactions, only sales to NHS bodies must follow the EN16931 e-invoicing standard via Peppol,
- Public sector bodies must accept e-invoices if suppliers prefer them.
Possible E-Invoicing Model:
The UK is not expected to adopt a strict pre-clearance e-invoicing system but may follow Belgium’s phased approach:
- First phase (4-corner model): Mandating structured e-invoicing between businesses, with Peppol as an option,
- Second phase (5-corner model): Adding digital reporting to HMRC for summary e-invoice data.
The UK government is open to industry input to create a system that benefits businesses (faster payments, efficiency) while improving tax compliance. Businesses should stay informed and provide feedback during the consultation to shape future e-invoicing policies.
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