What is Making Tax Digital (MTD)?
Making Tax Digital (MTD) is HMRC's programme to digitise UK tax compliance. MTD for VAT is already live for all VAT-registered businesses. The UK government confirmed a B2B and B2G e-invoicing mandate starting April 2029, requiring all VAT-registered businesses to adopt structured, machine-readable invoices on a decentralized 4-corner exchange model rather than a centralized government portal.
What does the UK 2029 e-invoicing mandate cover?
The UK's April 2029 B2B e-invoicing mandate will apply to:
- All VAT-registered businesses in the UK
- Both B2B (business-to-business) and B2G (business-to-government) transactions
- Structured, machine-readable invoice formats replacing paper and PDF invoices
- Decentralized 4-corner exchange model — no centralized government routing portal
How does the UK 4-corner e-invoicing model work?
The UK's decentralized 4-corner model routes invoices between trading partners via certified Access Points rather than a single government hub. The model connects: Supplier → Supplier's Access Point → Buyer's Access Point → Buyer. Real-time reporting (RTR) is not included in the initial 2029 mandate but may be explored in subsequent phases.
Frequently Asked Questions
- Will the UK use a centralized invoice portal?
- No. The UK plans a decentralized 4-corner model relying on interoperable certified access points rather than a single government routing hub, contrasting with countries like France that use a central PPF.
- Does the UK 2029 mandate include real-time tax reporting?
- Real-time reporting (RTR) is not included in the initial April 2029 mandate. The focus is on structured e-invoice exchange between businesses. RTR may be considered in future phases.
- Are PDF invoices compliant under UK MTD e-invoicing?
- Under the April 2029 mandate, visual PDFs and HTML email invoices are not classified as compliant e-invoices. Structured, machine-readable formats are required.