UAE Announces Fines of Up to Dh5,000 for Violating E-Invoicing Regulations
Penalties detailed ahead of July 2026 rollout as businesses urged to prepare for mandatory compliance.
The UAE Ministry of Finance has announced a detailed penalty framework for violations of the country’s electronic invoicing regulations, signalling tighter enforcement ahead of the system’s mandatory rollout in July 2026.
Under Cabinet Decision No. 106 of 2025, businesses that fail to comply with the UAE Electronic Invoicing System may face fines ranging from Dh100 per day to Dh5,000 per month, depending on the nature and duration of the violation.
The e-invoicing framework, introduced in the second quarter of 2025, requires tax invoices to be created, exchanged, and reported electronically in a structured, machine-readable format such as XML. The system replaces traditional paper and PDF invoices and aims to enhance transparency, accuracy, and efficiency in VAT and other tax-related processes through direct reporting to the Federal Tax Authority (FTA).
Penalties under Cabinet Decision No. 106 of 2025
The Cabinet decision outlines a series of administrative penalties for issuers and recipients who fail to comply with system requirements, including:
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Dh5,000 fine per month or part thereof for failure by the issuer to implement the e-invoicing system, including not appointing an accredited service provider within the prescribed timeline.
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Dh100 per electronic invoice, capped at Dh5,000 per calendar month, for failing to issue or transmit an e-invoice to the recipient through the system on time.
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Dh100 per electronic credit note, capped at Dh5,000 per calendar month, for failure to issue or transmit credit notes within the required timeline.
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Dh1,000 per day or part thereof for failure by the issuer to notify the authority of a system failure within the specified timeframe.
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Dh1,000 per day or part thereof for failure by the recipient to notify the authority of a system failure.
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Dh1,000 per day or part thereof for failure by either the issuer or recipient to notify the accredited service provider of changes to registered data within the required timeline.
Anurag Chaturvedi, CEO of Andersen in the UAE, noted that penalties also apply when invoices or credit notes are issued but not transmitted through the system on time, at Dh100 per document, capped at Dh5,000 per month for each category.
The first mandatory phase of the UAE’s e-invoicing system is scheduled to go live in July 2026, giving affected businesses a limited window to prepare for full compliance.