In Representation 34/25, ICAEW’s Tax Faculty has responded to the government’s consultation on increasing the adoption of e-invoicing by UK businesses and the public sector. Topics explored in the consultation include:

• whether e-invoicing should be mandatory or remain voluntary; and 
• the opportunity for real-time, or close to real-time reporting of data to HMRC. 

ICAEW strongly supports the adoption of e-invoicing in the UK and has cited international evidence demonstrating that e-invoicing can:

• improve productivity and reduce costs; 
• cut payment times and improve cash flow; and
• encourage tax compliance and increase revenues.

Many countries, including EU member states, have already introduced e-invoicing mandates or national frameworks. ICAEW believes that the UK’s current lack of a co-ordinated e-invoicing policy places its businesses at a growing disadvantage and could deter capital investment. The government’s consultation is a timely opportunity to close the gap and lay the foundations for future digital transformation. 

However, successful implementation of e-invoicing will require careful planning, targeted support and alignment with existing international standards. ICAEW recommends that the government:

• adopts a decentralised model using established international standards;
• ensures that standards are clear, consistent and flexible;
• prioritises voluntary adoption; 
• considers making it mandatory only after careful evaluation and not before 1 January 2030 to allow businesses time to adjust and align with the EU’s VAT in the digital age reforms; 
• approaches real-time reporting and additional services cautiously; and
• commits to further consultation on detailed implementation issues. 

Further information

• Economy explainers: e-invoicing
• Government seeks views on e-invoicing
• E-invoicing: digital revolution or compliance hurdle?
• The Tax Track podcast: VAT gets its day in court – again (E-invoicing is discussed from 15 minutes and 29 seconds onwards.)