At Compliance Connect 2026 in London, Thomson Reuters revealed findings from a recent report that identified the state of preparedness UK organisations have for the European reform known as VAT in the Digital Age (ViDA). The new compliance horizon, a 2026 ViDA Readiness report, is based on a survey of 225 tax and finance professionals. In organisations with revenues of at least €100 million based in Germany, France, Spain, the Netherlands, Sweden, Belgium and the United Kingdom.
While the legislation certainly applies to organisations within the EU, it will also apply to those outside it, including those with operations within Europe. With a deadline of 2030, only 22% of respondents have a formal transition program in place. That is despite 86% having an awareness of the new regulations.
Of concern for UK organisations is that the number is even lower in the UK. However, the report did not reveal the actual percentage. With regulations coming into force as early as January 1 2027, there is a limited time for organisations to prepare.
Key findings
What makes ViDA different from other EU Regulations is that this is not like GDPR, where non-compliance is potential fines, it impacts the business directly. Invoices may remain unpaid, as without e-invoicing systems in place that meet VAT requirements, UK businesses may struggle to be paid, leading to cash flow issues.
The three top concerns for non-compliance were:
- Business disruption (45%)
- Reputational damage with partners (45%)
- Financial penalties (44%)
One of the issues highlighted by the research is that organisations are framing ViDA as a technology initiative rather than a compliance issue. In a blog accompanying the report, Hertz Casseus, Senior Regulatory Associate, Thomson Reuters, wrote, “This suggests that many organisations are interpreting ViDA first through an implementation lens while the wider governance, risk, and operating model implications are not yet as consistently recognised.”
The report highlights that the regulations are more complex than they first seem, and finance teams should consider the compliance complexities quickly. The compliance complexity is also impacting technology decisions. With many organisations struggling to identify the correct solutions that will enable compliance.
The decisions made now will have a wider importance with a final key finding indicating that “Compliance presents significant opportunities for corporate tax departments to become strategic partners, increasing their value to the organisation.”
However, compliance cannot be achieved in isolation, and corporate tax departments will need to work closely with other teams from IT, Finance, eCommerce and Procurement.
What is in the report
The 18-page report is divided into seven sections. Each section contains a mix of commentary, data points and data visualisations. It also includes an in-depth look at the topic itself. Providing background to the regulation and insights from the Thomson Reuters Institute and tax professionals. The six sections include:
The new compliance horizon: What is ViDA? And why does it matter?
Explains what ViDA is and how it will impact organisations. Any organisation, from SME to Enterprise, will be affected by the framework if it does business in Europe. In some cases, that is coming sooner than later, Thomson Reuters explained during a presentation.
France’s mandatory B2B e-invoicing and e-reporting mandate officially launches on September 1, 2026. And all VAT-registered companies must be fully equipped to receive electronic invoices. SME’s will be affected from January 1 2027.
Even as a foreign entity invoicing a French company, your client might want you to comply by sending electronic invoices to enable easier compliance. In Poland, legislation is already in force and will expand to all firms within Poland by January 2027.
As the report and sessions make clear, while technology is an enabler for the new legislation, it is a compliance project that will impact multiple functions across the business.
“Comfortable uncertainty”— Confidence starts high, but detailed understanding and readiness are lacking
The report highlights that while firms are aware of the legislation, preparation varies. What was made clear from the speakers is that those organisations that are starting to investigate ViDA are realising that the task is larger than expected. Those who have completed their investigating actually become more confident.
For example, 90% are somewhat or very confident where there is no program in place. Only 79% are somewhat or very confident regarding the assessment. While 98% are somewhat or very confident when the program is funded.
ViDA readiness challenges
While there is a technology element that organisations will need to manage 27 different frameworks across Europe, the operational challenge is larger. Many firms have gaps in preparation. Key challenges remain:
- Master Data quality and KYC are in place for only 41%
- Systems integration is seen as a big challenge
- Internal expertise
The choice of a technology solution also evolves through the evaluation process. With 58% considering a specialised 3rd party solution, only 13% are looking to extend their ERP. The reason for this is that ERP solutions rarely provide the granular compliance control that will be needed when compared to a full compliance solution.
Benefits and risks of ViDA
Several business benefits that go beyond compliance are highlighted in the report. The top three perceived benefits were:
- Better data quality & visibility – 56%
- Reduced VAT compliance risk & fewer errors – 47%
- Reduced manual processing & admin burden – 41%
Risks of non-compliance go beyond regulatory fines. An inability to have invoices accepted for legal reasons could impact cash flow. For cross-border transactions, even for those exempt, an inability to raise e-invoices might become an issue that damages relationships.
The path forward: A maturity-based action plan
The authors have provided some broad suggestions for organisations to move forward. The path is not complex, and Thomson Reuters does not believe a simple checklist will suffice. Instead, organisations need to get the foundation in place for what could be a large and complex compliance project. The authors provide three suggestions for organisations to start moving forward.
Into the Digital Age
A short concluding section that summarises the challenge and benefits that ViDA can bring to organisations. Thomson Reuters offers a mix of solutions under the ONESOURCE brand that will fulfil all the requirements for organisations looking to deliver ViDA compliance.
The solutions combine ONESOURCE Compliance Hub, ONESOURCE Determination, ONESOURCE E-Invoicing, ONESOURCE Reconciliations and ONESOURCE Indirect Compliance (Newly Launched). With ready integrations to commonly used ERP solutions, the ONESOURCE platform can help organisations to overcome the challenge presented by ViDA.
Enterprise Times: What does this mean?
This is a comprehensive report that goes well beyond highlighting the data points from the survey. It is a useful source for any business leader who wants to get a broader understanding of ViDA and what it might mean for their business and the approaches that organisations are already undertaking.
Multinational organisations should already be aware. Those organisations that have a presence in EU countries should certainly start to take notice. With the UK also introducing e-invoicing by 2029, no business leader can ignore what is going to change how organisations conduct business over the next few years. In the UK, the next step is the publication of a roadmap, which is due out around the time of the Autumn budget.
