On 23 June 2026, HMRC published the Tax Update 2026: Simplification, Modernisation and Fairness, a package of 40 measures, several of which directly impact VAT, e-invoicing, customs and indirect tax compliance.
Summary
- HMRC is exploring how richer transaction-level data already held within business ERP and accounting systems could supplement the existing 9-box VAT return, recognising that the current return provides little useful insight for compliance, risk-targeting or repayment validation.
- The direction of travel mirrors ViDA Pillar 1 (Digital Reporting Requirements), SAF-T (PT, RO, PL, NO, FR draft, HU), and pre-filled returns seen in Italy, Spain, Hungary and Portugal — strongly suggesting a future UK move toward standardised digital reporting, potentially leveraging the Peppol e-invoicing network confirmed in the same Tax Update.
- For multinationals, this is the most strategically important VAT signal in the package: while no mandate is proposed yet, it is a clear pre-announcement that businesses should design ViDA-aligned data architectures that can extend to a UK SAF-T-like or near-real-time reporting regime, avoiding fragmented “UK-only” builds later.
Article The Tax Update flags the potential use of “supplementary” data for VAT returns — essentially using data already captured in business ERP/accounting systems to support compliance and improve HMRC’s efficiency. While no formal mandate has been announced, this clearly signals the direction of travel: the UK is moving toward the same digital data-rich VAT reporting model being implemented across the EU under ViDA and in countries already using SAF-T / e-reporting frameworks.
Primary Sources
- GOV.UK – Tax Update 2026 summary (HMRC policy paper) [gov.uk]
- GOV.UK – Tax Update 2026 collection (all consultations & documents) [gov.uk]
- Written Ministerial Statement HCWS141 – 23 June 2026 [questions-…liament.uk]
- Deloitte – Weekly VAT News, 29 June 2026 [taxscape.d…loitte.com]
- KPMG UK – Tax Update 2026 commentary [kpmg.com]
- Deeks VAT Consultancy – Tax Update 2026 for VAT, indirect tax and customs [deeksvat.co.uk]
- Kreston Reeves – Tax Update June 2026 [krestonreeves.com]
- Chartered Institute of Taxation (CIOT) – HMRC Tax Update June 2026 [tax.org.uk]
