Global Daily Tax News, UAE Establishes Penalties For New E-Invoicing Regime, (Dec 1, 2025)

The United Arab Emirates Ministry of Finance has released Cabinet Decision No. 106 of 2025, establishing penalties that will be introduced for violating the nation's new electronic invoicing rules, which are to be introduced from January 1, 2027.

A pilot phase will launch in July 2026. Those taxpayers taking part in the pilot will not be liable to the penalties set out in the Decision during the pilot's term.

From January 1, 2027, electronic invoicing will be mandatory for taxable persons with annual turnover exceeding AED50m. These taxpayers must appoint an accredited service provider (ASP) by July 1, 2026.

The requirements will be expanded to all other taxable persons from July 1, 2027, and to business-to-government transactions from October 2027, with a requirement to appoint an ASP by March 31, 2027.

A list of such services providers has been released by the Ministry.

The new Cabinet Decision establishes the following penalties for non-compliance:

• AED5,000 per month, or each part thereof, for failure to implement the e-invoicing system, including appointing an ASP, within the required deadlines;

• AED100 for each invoice not submitted to a recipient, up to a maximum of AED5,000 per calendar month;

• AED100 for each electronic credit note not submitted to a recipient, up to a maximum of AED5,000 per calendar month;

• AED1,000 per day, for failure by an issuer or recipient to notify the Authority of a System Failure within the timelines prescribed by the Minister; and

• AED1,000 per day, for failure by an issuer or recipient to notify the appointed ASP of changes to the data registered with the Authority within the prescribed deadline.