VAT groups and e-invoicing: how the 2029 mandate applies

Yes, VAT groups are in scope. A VAT group is treated as a single taxable person with one VAT registration number, so its VAT invoices to customers outside the group are covered by the government's requirement that all VAT invoices are e-invoices from April 2029. Supplies between group members are normally disregarded for VAT and do not need VAT invoices, which keeps most internal invoicing outside the mandate's core.

The harder questions for groups are practical: identifiers, routing and which entity's name appears on the e-invoice.

How VAT grouping works

HMRC's Notice 700/2 sets out the basics:

• Eligible persons can apply to be treated as a single taxable person. Registration is in the name of the representative member, which files one VAT return for the group.
• Previous VAT numbers are cancelled and one group number is issued. "This registration number must then be used by all the group members."
• Supplies by a member to a third party are treated as made by the representative member, and supplies received from third parties are treated as received by it.
• All members are jointly and severally liable for the group's VAT.
• Supplies between members are normally disregarded, so "VAT need not be accounted for on these supplies and no VAT invoices must be issued in respect of them."

The notice also says that references to the UK in it include the Isle of Man.

What is in scope for a group

Invoice flow	VAT invoice required today?	Mandate position
Group member to an outside VAT-registered customer	Yes, showing the group VAT number	In scope from April 2029
Group member to a public-sector body	Yes	In scope (B2G)
Outside supplier to a group member	Yes, to the group	In scope: the group should expect to receive e-invoices
Member to member (disregarded supply)	No	Outside the VAT-invoice core. Treatment of commercial intercompany invoices not confirmed
Services covered by the section 43(2A) intra-group charge	A charge is calculated even without an invoice	Not confirmed
Goods in Northern Ireland supplied between members not both established there	Disregard does not apply; VAT due	Not confirmed

Many groups raise internal invoices for transfer pricing, statutory accounts or cost allocation even where VAT disregards the supply. Those documents are not VAT invoices. Nothing announced so far brings them into the mandate, but watch for the roadmap's definition of what must be an e-invoice.

The identifier problem

The UK will use Peppol. The Tax update 2026 says "the electronic procurement system Peppol will be the core interoperability network for e-invoicing in the UK." Each business on Peppol is found by its Peppol ID. For UK businesses the obvious choice is the VAT number, under scheme code 9932.

For a VAT group, that creates a problem. Peppol's Service Metadata Locator specification states that "each participant identifier is registered with one and only one SMP". If ten companies share one VAT number, only one Peppol registration can use the VAT-number ID. Customers who route invoices by VAT number would reach one inbox for the whole group.

Groups have a few options. None has been endorsed by HMRC for the mandate:

1. One group inbox using the group VAT number, with internal routing by legal entity, buyer reference or purchase order.
2. Separate identifiers per entity using another scheme in the Peppol code lists, such as a Global Location Number (scheme 0088), alongside or instead of the VAT-number ID.
3. A hybrid: the VAT-number ID for the main trading entity, other IDs for the rest.

Whatever you choose, suppliers must be able to find the right entity. Publish your identifiers and keep them in supplier onboarding packs. Our guide to Peppol participant IDs goes deeper.

Whether the UK will publish identifier rules specifically for VAT groups is not yet confirmed.

Whose name goes on the e-invoice?

HMRC's guidance says the group VAT number must be used by all members. In practice, many members issue invoices in their own legal name with the group VAT number. In a structured e-invoice the seller's legal name, VAT identifier and legal registration identifier are separate fields, so you need to decide, entity by entity:

• which legal name appears as the seller
• that the group VAT number appears as the seller VAT identifier
• which company registration number appears, if any

Check that your ERP's master data matches. Mismatches between names, VAT numbers and Peppol IDs are a common reason for rejected or misrouted e-invoices.

Joining or leaving a group

Changes in membership affect e-invoicing directly:

• A company joining a group stops using its own VAT number, which cancels any Peppol ID based on that number.
• A company leaving gets its own VAT number again and needs its own e-invoicing set-up from that date.
• Customers and suppliers must be told, because their routing will change.

Build these steps into your VAT group change checklist.

Recent change to cross-border grouping

Separately, Budget 2025 removed the requirement to consider Revenue and Customs Brief 18/2015 for cross-border transactions between members of a VAT group, from 26 November 2025. This returns the UK to "unmodified whole-entity VAT grouping". It does not change the e-invoicing position above, but groups with overseas branches should review intra-group flows with their advisers.

What to do now

1. Map every entity in the group, its legal name, the group VAT number and the systems that issue its invoices.
2. Decide your Peppol identifier strategy before suppliers start asking.
3. List intercompany invoice flows and note which are disregarded for VAT.
4. Flag Northern Ireland and overseas members for specialist review.
5. Track the roadmap at Budget 2026 for any VAT-group-specific rules.

See also who is in scope and the mandate guide.