UK e-invoicing consultation published

28 February 2025| CATEGORIES: e-invoicing, HMRC consultation| TAGS: e-invoicing, HMRC consultation, UK

HMRC and the Department for Business and Trade (DBT) have published a consultation on Electronic invoicing: promoting e-invoicing across UK businesses and the public sector. The UK government is considering implementing e-invoicing and real-time reporting rules which would cover both the means by which invoices can be exchanged and the data set requirements necessary for an invoice to be valid.

Purpose of the consultation

The government is seeking views from a range of stakeholders on standardising e-invoicing, and how to support the increased adoption of e-invoicing.

Issues that the government is interested in exploring include:

• different models of e-invoicing;
• whether to take a mandated or voluntary approach to e-invoicing;
• what scope of mandate might be most appropriate in the UK and for businesses;
• whether e-invoicing should be complemented by real-time digital reporting.

The government considers that increased uptake of e-invoicing could improve business productivity, reduce errors in invoices and tax returns, improve cashflow, simplify tax reporting, and reduce the tax gap.

e-invoicing in the UK

There are currently no mandated standards for e-invoicing in the UK (except for suppliers to NHS England who are required to issue e-invoices via the PEPPOL network). The consultation notes that for e-invoicing to provide benefits, all systems would need to be able to interact with each other based on common standards. The consultation asks for views on how standards could be used to support e-invoicing adoption and potential benefits, but at this stage the government is not looking to identify specific standards for adoption.

Currently in the UK a business can choose whether to adopt e-invoicing systems.  Globally different countries have taken different approaches on whether or not to introduce a mandate for e-invoicing.  The consultation seeks view on whether a mandate should be introduced in the UK.

e-invoicing models

The consultation identifies that a key factor when considering different models of e-invoicing is whether a model has centralised or decentralised systems. With a centralised model, e-invoices are submitted to the tax authority before being issued to the buyer. With a decentralised model, there is no central ‘hub’ through which invoices are routed, with businesses submitting their invoices through their software providers direct to their customers.

The consultation makes it clear that the government is not seeking to implement a centralised e-invoicing model which would require suppliers to submit and validate invoices to a centralised platform before they are issued to the customer. It does, however, note the possibility of implementing a centralised data share model which would require suppliers to issue invoices to a central platform, thereby allowing HMRC the ability to read and extract transaction details, as well as allowing customers to receive and process e-invoices.

Business engagement and next steps

The consultation will run for 12 weeks from 13 February to 7 May 2025.

In addition to the consultation, the government will hold business round tables and other events to enable stakeholders to contribute to future policy development.

If the government decides to introduce standardised e-invoicing in the UK, or any form of mandate, it will continue to work with businesses and representative organisations across the economy to develop policy which delivers benefits for businesses.