E-invoicing for public sector suppliers

The Government plans to make e-invoicing mandatory for VAT invoices to businesses and public bodies from 1 April 2029. If you supply councils, the NHS, schools or housing associations, here's what's been announced, what it means for getting paid, and how to get ready.

Last checked 18 October 2026 · by the TendersNearMe team

What's changing

At the Autumn Budget on 26 November 2025, the Government confirmed it plans to make e-invoicing mandatory for all VAT invoices from April 2029. That covers business-to-business invoices and business-to-government invoices, the ones you send after winning public sector work. HMRC and the Department for Business and Trade are designing the details with businesses and software makers, and it still needs Parliament's approval.

Who it applies to

It doesn't matter whether you're a sole trader, partnership or limited company. What counts is whether you're VAT registered and who you're invoicing.

Why it matters if you win public sector work

• Public bodies are ready first. Parts of the NHS have bought through Peppol for years, and many councils' finance systems can already receive e-invoices. Expect more buyers to ask for them before 2029.
• No PO number, no payment. An e-invoice has a dedicated field for the buyer reference or purchase order number. Invoices without one are likely to be rejected automatically, so ask for it before you start the work.
• The 30-day clock starts with a valid invoice. Public bodies must pay valid, undisputed invoices within 30 days. A correct e-invoice makes it harder for yours to sit in a queue. See getting paid on public sector contracts.
• Subcontractors too. If you invoice a main contractor on public work, they'll expect e-invoices as well once the rules apply to business-to-business invoices.

Why a PDF won't count

Most "electronic" invoices today are PDFs attached to emails. Under the planned rules, an e-invoice is a structured data file that the buyer's finance system reads automatically, with no retyping. A PDF is made for people to read; an e-invoice is made for software to read.

What Peppol is

On 23 June 2026, HMRC confirmed Peppol as the core network for UK e-invoicing. Your invoicing software hands the invoice to an accredited Peppol access point, which delivers it to the buyer's access point and finance system. The format is expected to be based on Peppol BIS Billing 3.0 and the European standard EN 16931; HMRC hasn't yet published the final UK specification. No real-time reporting to HMRC is planned at the start.

Timeline

What an e-invoice needs

• Your business name, address, postcode and VAT number, plus your company number if you're a limited company
• The buyer's registered name and address, and their buyer reference or purchase order number
• Invoice number, issue date, due date and the date of supply
• For each line: description, quantity, unit, price and VAT rate (standard, reduced, zero-rated, exempt or reverse charge)
• VAT totals for each rate, and your bank details
• Credit notes linked to the invoice they correct

How to get ready

1. Check whether it applies to you with the e-invoicing checker.
2. Move off Word, Excel and paper invoices to invoicing software that plans to support Peppol.
3. Ask each public sector buyer how they want to be invoiced and for their purchase order process.
4. Tidy your customer records: registered names, full addresses with postcodes and VAT numbers.
5. Get VAT right on every line, including the domestic reverse charge for construction work. Reverse charge explained.
6. Watch for the roadmap at the Autumn Budget on 28 October 2026. We'll update this guide when it's published.

Need invoicing software that's getting ready for e-invoicing? PaySorted, from the team behind TendersNearMe, already creates Peppol BIS 3.0 e-invoice files.

General information based on Government announcements and HMRC guidance (checked 18 October 2026), not tax advice. The final rules haven't been published yet.

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