Background
One of the main features of the VAT regime in the European Union (EU) is the VAT invoice, as this is the main tax document that determines when VAT has to be accounted for. It is also the primary document for a business to determine when it is entitled to recover what it has been charged. Historically, the invoices have been in paper form and the rules governing their content and issue have reflected this. However, increasingly businesses have been adopting electronic invoicing and although the VAT Directive provided for electronic invoicing the rules were more restrictive and not consistent across the Member States. In order to address this issue the Council of the EU has adopted a Directive aimed at simplifying the VAT invoicing requirements in particular as regards electronic invoicing.
Summary of the UK Budget delivered by the chancellor on 22nd June 2010