All VAT-registered businesses will need to change the way that invoices are managed starting from 1 April 2029.
A staggering 91 per cent of SMEs have no knowledge of this upcoming change, despite it being less than three years away.
In order to prepare effectively, now is the time to understand the e-invoicing requirements and what should be done before the deadline.
There were a lot of things discussed in the 2025 Autumn Budget and something that seems to have slipped out unnoticed was the announcement that, from 1 April 2029, businesses will be required to issue all VAT invoices as e-invoices.
While you may be tempted to format a document as a PDF and consider the matter sorted, the new rules are more involved than that.
To be compliant, VAT invoices will need to be formatted as machine-readable data and sent directly between accounting systems.
This will result in your invoice showing up directly on the system of the person you are sending it to and should go some way to tackling the longstanding issue of late payments.
The Government note that e-invoices can reduce late payments by as much as 20 per cent and this mandatory adoption is done with the aim of achieving this objective.
Yet the data from HMRC shows that only 9 per cent of SMEs were even aware that these changes were on the table and that 69 per cent had never used an e-invoicing system before.
This leaves a great many businesses in need of changing operational procedures dramatically ahead of the 2029 deadline.
Major overhauls to systems and regulations are not something to be treated lightly, as those currently handling their new Making Tax Digital for Income Tax requirements can attest.
For those businesses already using e-invoicing, it will be worth checking with financial experts and the software provider whether the current system will be suitable for the new requirements.
If you have not yet taken the step towards a technological future with e-invoicing, then now is the time to start considering your options.
Talking things through with a professional financial expert will help you to understand what you need to look out for in software and how to choose one that suits the needs of your business.
A full timeline and roadmap are expected to be revealed in the 2026 Autumn Budget and we will be sure to update you when we know more.
Until then, our expert team can help you to embrace more technological solutions to ensure that your business is paid fairly and on time.
Take the stress out of e-invoicing preparations by getting in touch with our team.
