United Kingdom - 2018 eInvoicing Country Sheet

Legislation

The 2015 Small Business, Enterprise and Employment Act grants powers to Ministers to regulate the use of electronic invoicing in the field of public procurement in England. This does not apply to Northern Ireland, Scotland or Wales, which set their own regulations.

So far, the Ministries have made no specific regulations under the Act. It is recommended for public contracting authorities (central government, devolved governments, local authorities and arms-length agencies) to use eInvoicing and many have done so, including the National Health Service (NHS).

The fact that the use of eInvoicing in B2G procurement is not mandatory in UK has led to use of several third party service providers. Policy and implementation frameworks are expected to be put in place, such as those by the Scottish devolved administration.

The VAT Notice 800/63: electronic invoicing, updated on 22 May 2015, states that eInvoicing is not mandatory and it is up to economic operators to decide whether they submit electronic or paper invoices.

eInvoicing platform and eInvoicing management solutions

There is no single or central platform for eInvoicing UK-wide. When adopting eInvoicing, contracting authorities can:

1. Use a solution provided by a third-party service provider based on a 'three-corner' model, where contracting authorities and economic operators operate over a common platform, supported as required by interoperability agreements with other service providers;

2. Establish an internal system to enable eInvoicing that allows economic operators to submit their eInvoices directly;

3. As in the case of the NHS, consider the use of PEPPOL as an example of a 'four-corner' model, where the contracting authorities and economic operators operate from separate platforms or access points, which are then connected. 

There are central solutions in Wales and Scotland.

Approach for receiving and processing eInvoices

In the case where eInvoices are processed by third party service providers, eInvoices are submitted directly to their platforms. Service provider platforms sometimes process scanned paper invoices, although data is normally captured from economic operators through data-file transfer or portals or through machine-readable PDFs. Service providers then use the data received to create structured eInvoices before integrating them into contracting authorities work flow and ERP systems.

HMRC also supports the use of electronic data interchange (EDI) within a network for the supply and validation of eInvoicing. HMRC plans to adopt the eInvoicing standard (EN16931) prepared by the European Committee for Standardisation (CEN) as mandated by the eInvoicing Directive (2014/55/EU).

There are different approaches to the adoption of eInvoicing by central government in various parts of the UK:

Central Government

For example, the Ministry of Defence and HMRC use eInvoicing extensively. Major shared services facilities for groupings of departments are being rolled out and will include eInvoicing.

England

In January 2016, the NHS started adopting structured eInvoicing. The NHS is implementing the CEN BII eInvoice standard to be used in a network conforming to PEPPOL specifications, thus creating a four-corner model. In March 2017, 18% of invoices processed by NHS were in an electronic format.

Some local authorities have individually implemented eInvoicing solutions as part of their procurement activities and some have established joint shared-service centres to gain benefits from cooperation, such as cost reduction and faster processing and prompt payment of eInvoices.¹ 

Scotland

The Scottish Government is providing a national eInvoicing solution through PECOS P2P which is a core component of its national eCommerce Shared Service.  Any Scottish public sector organisation can implement the solution regardless of the P2P or finance system in use.  The solution accepts PDF invoices (and other formats) that have been automatically generated and issued by a supplier and transforms these into a cXML file.  This file is then automatically presented to the invoice matching environment for onward processing and payment utilising already configured auto-match and invoice management workflow.

The Scottish Government is centrally coordinating the adoption of eInvoicing by Scottish public sector organisations and suppliers and is working to ensure that all concerned stakeholders understand the requirements of the eInvoicing Directive (2014/55/EU). Furthermore, it is also working to ensure that public sector organisations are aware of the key activities that need to be delivered to ensure a successful implementation of eInvoicing and is sharing lessons learned and best practice across organisations. 

To date (June 2018) , the Scottish Government has 16 organisations and 63 suppliers who are live and using the eInvoicing solution. A further 44 public sector organisations are either in the process of implementing the solution or developing plans to do so with a further 90 suppliers who are in the process of being onboarded.

As at the end of May the solution has captured 337,973 invoices and delivered transactional efficiency savings of just over £4.4 million.

Wales

Following the transposition of the eInvoicing Directive, policy decisions regarding eInvoicing will be put in place. To this date, some Welsh Public Sector organisations have adopted a variety of solutions including Finance/P2P, OCR, outsourced scanning, Smart PDF, EDI, Supplier Portal (back-office integration and PO Flip) and the use of virtual and physical e-Payments (Purchasing Card).

An eInvoicing Special Interest Group has been formed with attendees represented from various sectors. The eProcurement Service (ePS) facilitates the Special Interest Group and hopes that it will help to inform the Welsh Public Sector eInvoicing strategy and development of best practices for the implementation of eInvoicing in Wales. An example of a local government procurement strategy incorporating eInvoicing is the Procurement Strategy 2016 - 2019 for Merthyr Tydfil that includes the e-invoice Policy 2016.

Status on the implementation of the European Standard on eInvoicing (EN)

Work is underway to transpose the eInvoicing Directive into UK national law before the deadline 18th April 2019. The EN is available on BSI website. Communications with stakeholders to promote the use of the EN have started, however this promotion is currently restricted by the requirement to pay for the EN.

Additional information

There is no additional information available. 

VALIDATED BY THE EMSFEI MEMBER

Last updated:  Dec 20, 2019 17:12