The UK goverment has confirmed a major step toward digital VAT administration in their 2025 Budget. From 1 April 2029, B2B and B2G eInvoicing is expected to become mandatory across the UK. While the finer details are still to come, the Government has signalled a decentralised 4-corner model, as the preferred options for businesses, considering its interoperability and compatibility with international frameworks like Peppol and the EU ViDA’s initiative. Following the adoption of eInvoicing the government will consider the case for introducing some form of eReporting to HMRC.

This shift will be one of the most significant UK VAT changes since Making Tax Digital. Although the structure is still evolving, the Treasury is aligning with proven approaches used in Belgium and other EU countries already seeing revenue boosts from digital reporting and eInvoicing. 

Is phasing expected?

So far, the official message is that the government has chosen to mandate eInvoicing for all VAT invoices from 2029.  

More clarity on the implementation timelines is scheduled at the Autumn Budget in November 2026, where the technical framework and scope should be finalised and a roadmap to implementing this mandate will be published.  

Before then, the roadmap includes: 

  • Current status: Voluntary eInvoicing 
  • February – May 2025: Public consultation on eInvoicing mandate completed 
  • November 2025: Budget 2025 – April 2029 eInvoicing mandate timelines 
  • January 2026: HMRC starts detailed collaboration with stakeholders to design and develop the UK’s eInvoicing regime 
  • November 2026: Budget 2026 – eInvoicing implementation roadmap 
  • 2027 – 2028: Build, testing and pilot phase 
  • 2029: Mandate rollout begins 

What did the consultation ask?

In February 2025, the government launched a consultation on ‘Electronic invoicing: promoting e-invoicing across UK businesses and the public sector’. This aimed to gather views on standardising eInvoicing and how to increase the adoption across UK businesses and the public sector. The consultation explored how the UK should design an eInvoicing regime that actually works in practice. Areas of focus include: 

  • Centralised vs decentralised models  
  • Voluntary vs mandatory adoption 
  • Whether reporting to HMRC should be included 
  • Preparation time required for businesses 
  • Use of standards such as EN16931 
  • Whether pre-filled VAT returns should eventually become possible 

Why a 4-corner Peppol model?

The NHS already requires Peppol-based eInvoicing . All public bodies must be able to receive a structured eInvoice which comply with a specified standard BS EN16931, if a supplier wishes to send one. 

Looking at Europe, Belgium’s two-stage model has gained strong industry and government support: 

Stage 1: Mandated structured eInvoicing between businesses via internationally used framework like Peppol (4-corner exchange) 

Stage 2: Add a digital reporting layer (5-corner model) 

The UK appears to be signalling a similar approach, start with eInvoice exchange only, then introduce reporting later if needed.

Importantly, the UK Government appears open to a phased mandate and feedback from businesses and solution vendors. That gives organisations time to plan, modernise finance systems, and phase in automation. 

A tool against VAT fraud

HMRC has previously explored eInvoicing to make tax compliance easier and more accurate, reduce the tax gap, enhance productivity and cash flow, which is due. Structured digital invoices create traceability that: 

  • Prevents duplicate or manipulated invoices 
  • Tracks transactions through the supply chain 
  • Makes fraudulent claims easier to detect 
  • Reduces manual error and non-compliance 

Countries that already use mandatory eInvoicing and reporting have raised billions in additional VAT revenue. It’s easy to see why the UK wants the same benefits. 

The current eInvoicing rules in the UK

Although eInvoicing isn’t mandatory today, it is permitted for B2B transactions when both parties agree. Businesses must still comply with essential invoice requirements: 

  • Authenticity and integrity 
  • Accurate supplier and customer details 
  • VAT elements such as numbers, rates, descriptions, totals 
  • Storage for six years in a readable and accessible format 

These requirements align with existing EU VAT standards the UK continues to follow. 

How Fintua helps

As the UK follows the path of eInvoicing  network exchange, digital standards and future reporting, businesses will need systems that join up tax, data and invoicing. 

Fintua is provides an all-in-one solution for VAT compliance and eInvoicing. We help organisations prepare early, so compliance becomes an advantage, not a scramble. 

Want to get ahead of the 2029 mandate?

Talk to our team and explore future-proof eInvoicing and VAT automation.

Authors

103476UK to mandate B2B eInvoicing from April 2029

Helen Long

Content Marketing Manager at Fintua

As Fintua’s Content Marketing Manager, Helen creates content that helps tax and finance professionals stay informed of the ever-changing world of VAT.