Self-billing and e-invoicing: what HMRC rules mean for 2029

Self-billing is expected to continue under UK e-invoicing, but the UK-specific rules are not yet published. HMRC's self-billing rules in VAT Notice 700/62 still apply. The UK has chosen Peppol, which already has a dedicated self-billing standard. And the government's consultation response says HMRC has confirmed that concerns "including self-billing and the VAT reverse charge" have been addressed in other jurisdictions' mandates.

What is not confirmed is exactly how a self-billed e-invoice will be specified and validated in the UK from April 2029.

A quick recap of self-billing

Self-billing is "a commercial arrangement between a supplier and a customer in which the customer prepares the supplier's invoice and forwards a copy to the supplier with the payment." It is common where the customer decides the value, such as:

• agricultural produce and livestock
• scrap metal and recycling
• royalties and commissions
• haulage and courier sub-contracting
• construction sub-contracting

You do not need HMRC's permission to self-bill. You do need to follow the rules.

The HMRC rules that still apply

Under Notice 700/62 (law: VAT Act 1994 section 29 and VAT Regulations 1995 regulation 13(3) to 13(3F)):

• A written agreement must be in place before self-billing starts. It must include the supplier's agreement to accept self-billed invoices, a promise not to issue its own VAT invoices for the same supplies, a start and expiry date, and a commitment to tell you about VAT registration changes. It must also say if a third party will issue the self-bills.
• Each self-billed invoice must be marked "SELF-BILLING". This sentence in the notice has the force of law. HMRC also advises adding: "The VAT shown is your output tax due to HMRC".
• The invoice must contain all the normal VAT invoice details.
• You must not self-bill unregistered suppliers, or a supplier whose VAT number has changed until a new agreement is in place.
• Corrections use a debit note rather than reducing a later invoice.
• Breaking the rules means the documents are not proper VAT invoices, so they cannot support your input tax claim.

HMRC suggests reviewing agreements every 12 months. Notice 700/63 adds that any electronic self-billing system must recognise self-billed invoices so that input and output tax are accounted for correctly.

How self-billing works in Peppol

The UK will use Peppol. Peppol publishes a separate specification, Peppol BIS Self-Billing 3.0, alongside the standard billing specification. Its key features:

Element	Self-billing value
Specification identifier (CustomizationID)	urn:cen.eu:en16931:2017#compliant#urn:fdc:peppol.eu:2017:poacc:selfbilling:3.0
Business process (ProfileID)	urn:fdc:peppol.eu:2017:poacc:selfbilling:01:1.0
Self-billed invoice type code	389 ("an invoice the invoicee is producing instead of the seller")
Self-billed credit note type code	261
Who sends	The buyer, to the seller

The direction of travel is reversed. In normal Peppol billing, the supplier sends an invoice to the buyer. In self-billing, the buyer sends the self-billed invoice to the seller's Peppol ID. So:

• the supplier must be registered on Peppol to receive self-billing documents, which is a separate document type from ordinary invoices
• the customer must be able to send them
• both sides' software must treat the VAT on the document correctly: output tax for the supplier, input tax for the customer

These identifiers come from the current Peppol specification (May 2026 release). Whether the UK will adopt Peppol BIS Self-Billing as-is, or with UK-specific rules, is not confirmed.

Questions the roadmap needs to answer

• Will self-billed invoices be in scope from April 2029 on the same date as other VAT invoices?
• Will the "SELF-BILLING" marking be satisfied by the document type code, or must it appear as text?
• What happens if the supplier is not on Peppol? Under the current rules, the supplier would have to issue its own invoices. That would undo the arrangement.
• How will the 14-day tax point rule and notional tax point apply to e-invoices?
• How will third-party bureaux that issue self-bills be treated?

Tax points still matter

Issuing a self-billed invoice does not normally create a tax point. The exception is when you issue it within 14 days of the basic tax point. The self-biller can use a notional tax point of the day after issue when it pays with the self-bill. Nothing announced changes those rules. Make sure your e-invoicing system records the correct tax point date on each document.

What to do now

1. List every self-billing arrangement, with the supplier's VAT number and agreement expiry date.
2. Check agreements are current and in writing. Agreements have expiry dates and can lapse unnoticed.
3. Ask your ERP or AP provider whether it supports Peppol BIS Self-Billing, both sending and receiving.
4. Contact your self-billed suppliers early. They will need to be reachable on Peppol for self-billing documents.
5. Keep reconciliations tight. Duplicate invoices, one self-billed and one from the supplier, are a common error that HMRC specifically warns about.

See our glossary entry on self-billing, and check who is in scope for the wider picture.