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E-invoicing: your questions answered
Short, straight answers based only on what the government has officially said. If something isn't decided yet, we say so.
When does e-invoicing become compulsory in the UK?
The government plans to make it compulsory from April 2029 for VAT invoices to other businesses and the public sector. Some official documents say "from 2029"; the most recent HMRC documents say April 2029. It still needs legislation.
Does e-invoicing apply to sole traders?
It depends on VAT, not on how your business is set up. If you're a VAT-registered sole trader and you invoice businesses or the public sector, it's expected to apply to those invoices.
I'm not VAT registered. Do I need e-invoices?
You're not expected to. The government has said many of the smallest businesses that aren't VAT registered won't be obliged to adopt e-invoicing. If your turnover goes over £90,000 and you register for VAT, it could apply from then on.
Do invoices to homeowners need to be e-invoices?
No. The plans cover invoices to businesses and the public sector. Invoices to homeowners and other private customers aren't included.
Can I still email PDF invoices?
Yes, until the mandate starts. From April 2029, for invoices that are covered, a PDF won't count as an e-invoice. You can keep sending PDFs to homeowners.
Will HMRC see my invoices in real time?
Not at the start. The government has said it won't introduce real-time reporting alongside the 2029 mandate. It may consider it later, once e-invoicing is well established.
What is Peppol?
Peppol is the network e-invoices will travel over in the UK. The government confirmed it in June 2026. Your invoicing software connects to it, so you won't need to deal with it yourself.
What format will UK e-invoices use?
That hasn't been decided. The government will either adopt an existing standard or design a UK-specific one. Peppol's current format, Peppol BIS Billing 3.0, is based on the European standard EN 16931.
Will small businesses get longer to prepare?
Nothing has been announced. Phasing by business size was suggested in the consultation, but the government hasn't confirmed it. The roadmap due at the Budget on 28 October 2026 may say more.
Will there be penalties?
No penalties have been announced yet. They're likely to be set out in the legislation, which HMRC expects to publish by the end of the 2027 to 2028 tax year.
What about CIS and the VAT reverse charge?
The government hasn't said how CIS deductions will appear on e-invoices. On the VAT reverse charge and self-billing, it has said that other countries with e-invoicing have dealt with them, but the UK design isn't decided yet.
Do I need to buy new software?
If you write invoices in Word, Excel or on paper, you'll need software that can create e-invoices for invoices that are covered. The government expects a range of products, including low-cost ones. It hasn't announced free government software.
Where can I get official updates?
On GOV.UK. Search for "electronic invoicing". This guide links to every official source we use, and we update it whenever something official changes.
Sources
- Budget 2025 (HM Treasury, 26 November 2025)
- Budget 2025: overview of tax legislation and rates, para 2.34 (26 November 2025)
- Promoting electronic invoicing: consultation response (HMRC and DBT, 26 November 2025)
- Tax update 2026: summary (23 June 2026)
- HMRC Transformation Roadmap update 2026: annex of planned activities
- GOV.UK: when to register for VAT
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