UAE sets fines for e-invoicing failures ahead of 2026 rollout

The UAE Ministry of Finance has published Cabinet Decision No. 106 of 2025, formally setting out administrative penalties for businesses that fail to comply with the country’s upcoming mandatory Electronic Invoicing System.

The decision, released on November 24, outlines detailed fines for non-implementation and operational lapses, signalling that authorities intend to take enforcement seriously once the system goes live.

Entities that are not yet fully compliant are likely to receive warnings and guidance rather than immediate fines in an effort to give organisations time to resolve technical issues ahead of strict enforcement.

However, the Ministry has confirmed that the penalties are legally binding and will ultimately be applied.

Penalties announced for e‑invoicing failures

The new framework sets monthly fines of AED5,000 for failing to implement the E-Invoicing System or failing to appoint an Accredited Service Provider by the required deadline. Failure to issue and transmit an electronic invoice or credit note carries a penalty of AED100 per document, capped at AED5,000 per month.

Additional fines of AED1,000 per day apply for failing to notify either the Ministry or the appointed service provider of system failures or changes to registered data.

The Ministry’s announcement follows two earlier decisions that clarified the scope and timeline for the UAE’s Electronic Invoicing System. Those decisions confirmed that electronic invoicing will apply to most business-to-business and business-to-government transactions.

All in-scope entities must appoint an Accredited Service Provider and issue all invoices and credit notes through the system, using the international OpenPeppol standard for digital document exchange.

The rollout will begin with a pilot phase on 1 July 2026. Businesses with annual revenue of AED50 million or more must adopt the system by 1 January 2027, while companies below that threshold must comply by 1 July 2027. Government entities must implement the system by 1 October 2027.

The Ministry said the measures reflect the UAE’s commitment to transparency, digitalisation and international best practice, while giving businesses adequate time to migrate.

The penalty table follows earlier announcements first released in September, which outlined the overall e-invoicing framework and phased national rollout.