UK e-invoicing from April 2029: what Business Central users need to know
The Budget confirmed it: mandatory e-invoicing over Peppol for VAT-registered businesses from 1 April 2029. Business Central already has most of what you will need through the E-Documents framework. What the legislation says, what it means for suppliers and buyers, what is in Business Central today, the gap that remains, and six things to do now.
Short version: UK e-invoicing is now law in the making. Business Central already has most of what you will need. The main gap is that the UK technical details have not been published yet, so there is preparation to do now and customisation to avoid until they are.
What the legislation says
At Budget 2026 the government published an e-invoicing implementation roadmap (GOV.UK policy paper, 28 October 2026) for VAT-registered businesses, including public bodies, from 1 April 2029, and will legislate in the Finance Bill 2026-27 to provide the enabling powers.
Who is in scope: VAT-registered persons, plus anyone who needs a VAT invoice to recover input tax, including public bodies that are not VAT-registered.
The network: Peppol will be the core interoperability framework for UK e-invoicing, and HMRC will take on the role of UK Peppol Authority (the timing of that handover is not yet set).
The detail comes later. The Finance Bill only provides the powers. The form and structure of the invoice, and the systems and networks to be used, will be set out in regulations, which can also provide for exemptions. Industry commentary expects HMRC's detailed technical requirements between October 2027 and April 2028.
No real-time reporting at launch. Commentators report that real-time reporting to HMRC will not be introduced alongside the 2029 mandate, but the Budget also included a consultation on e-invoicing digital reporting, so that may follow.
Cross-border e-invoicing is not expected to be mandatory from 2029.
What it means for UK businesses
A PDF is unlikely to be enough. Today, HMRC's guidance (VAT Notice 700/63) treats both structured formats such as XML and unstructured formats such as PDF as electronic invoices. The direction of travel is a structured invoice exchanged over Peppol; the regulations will confirm the exact format, but planning on "PDF by email will not count" is the safe assumption.
Both directions matter. Every in-scope business will need to send and receive VAT invoices electronically. That means your sales invoicing and your purchase ledger. Expect large customers to start asking for Peppol invoices well before 2029, the way the NHS and parts of the public sector already do.
There will be costs. One-off or subscription costs for software set-up, an access point provider, integration, staff training and process change.
There are real upsides. Less manual keying, faster invoice handling and payment, and far less time on matching, approvals and reconciliation. Structured invoices arriving straight into the purchase ledger is what makes tools like the Payables Agent genuinely useful.
Most businesses are not ready. HMRC research from March 2026 found that 59 per cent of VAT-registered SMEs are familiar with e-invoicing, but only 29 per cent use it and just 10 per cent both send and receive e-invoices.
What is in Business Central today
The groundwork is largely there through the E-Documents framework:
2026 release wave 1 (version 28) rebuilt the E-Documents and Peppol framework.
Sending: once a customer is configured with the right document sending profile and Peppol details, you post the sales invoice as usual and it goes out as an e-document (see document sending profiles).
Receiving: a supplier's e-invoice arrives on the Inbound E-Documents / Incoming Documents page, where it is converted into a purchase invoice or journal line. Version 28 added a purchase draft page to preview Peppol invoices first, and the ability to link inbound e-documents to existing purchase invoices.
Access point connectors: supported connectors include Avalara, B2BRouter, Continia, Logiq, Pagero and SignUp, plus a ForNAV connector added in version 28.
2026 release wave 2 (version 29) continues the work: the framework now extends beyond invoices to shipments and other operational documents, and EDI document exchange is on Microsoft's roadmap.
The caveat: Business Central does not yet have a UK-specific e-invoice format. It cannot be built until HMRC publishes its specification, so expect a UK localisation update once that lands.
What Business Central users should do now
Get on a current version (28 or 29). The newer E-Documents features are not available on older versions, and anyone still on NAV or an old on-premise Business Central has a bigger project ahead (upgrading from NAV).
Choose a Peppol access point provider from the supported connectors. The choice affects cost and how invoices are received, so compare a couple.
Pilot it in a sandbox with one or two willing customers and suppliers. Not in production (use a sandbox).
Clean up master data. Customer and vendor VAT numbers, addresses and Peppol participant IDs all need to be right, because structured invoices are validated automatically and rejected if they are not. The data clean-up discipline applies here too.
Check your extensions and report layouts. Custom invoice reports and third-party apps may need updating to work with the E-Documents flow (report layouts).
Watch for HMRC's technical specification and the outcome of the digital reporting consultation, and do not over-customise before then. Anything built to a guessed UK format now will be rebuilt later.
We are not tax advisers, and the UK rules are still being written, so check the final regulations when they are published. If you would like a readiness review of your Business Central setup for e-invoicing (version, master data, layouts, extensions and a connector shortlist), it fits neatly into our health check, or book a 30 minute call.
