UAE e-invoicing · Penalties
UAE e-invoicing penalties explained
Checked against the Ministry of Finance text on 6 November 2026. This page explains the rules; it is not tax advice.
Where the penalties come from
The penalties sit in Cabinet Decision No. 173 of 2026, on the violations and administrative penalties resulting from violation of the legislation regulating the Electronic Invoicing System. The Ministry of Finance published it in October 2026. It is issued under Federal Decree-Law No. 28 of 2022 on Tax Procedures.
It repeals Cabinet Decision No. 106 of 2025, the first penalties decision. Article 5 says it comes into force on the day after its publication in the Official Gazette. If you read an article that still quotes Decision 106, the amounts and caps in it are out of date.
The four violations and their penalties
The table annexed to the decision lists four violations. This is the full list, in plain words.
| Violation | Penalty |
|---|---|
| 1. Failing to implement the e-invoicing system on time, including failing to appoint an ASP; or, for a recipient, failing to stay compliant after implementation | AED 5,000 for the first instance, then AED 5,000 for each month or part of a month the non-compliance continues. Total capped at AED 50,000 in any 12 consecutive months. |
| 2. Failing to issue and transmit an e-invoice to the recipient through the system | AED 100 per e-invoice, up to AED 5,000 per calendar month |
| 3. Failing to issue and transmit an electronic credit note through the system | AED 100 per credit note, up to AED 5,000 per calendar month |
| 4. Failing to notify your ASP of changes to the data registered with the FTA | AED 250 for each day of delay or part of a day, up to AED 5,000 per calendar month |
Two further rules matter. Article 3(2) says that if the same person acts as issuer, recipient or both for the same violation, only one penalty applies. And violation 1 covers late implementation and a missing ASP in a single clause, so they are one violation, not two stacked charges.
What changed from the first decision
The new decision adds the AED 50,000 cap over 12 consecutive months for the implementation violation. Press coverage of the Ministry's announcement on 30 October 2026 also notes that the old penalty for failing to notify the authority of a system failure has been dropped. The Ministry said the revisions followed feedback from businesses.
For a finance team the practical reading is simple. The implementation penalty is a monthly meter with a ceiling. The per-invoice and per-credit-note penalties are small per document but reach their monthly cap quickly at normal volumes.
Voluntary adopters are excluded
Article 2(2) excludes any person who issues, transmits, exchanges or reports e-invoices and credit notes on a voluntary basis. The Ministry's e-invoicing guidelines say the same: penalties apply only from the date a business is required to implement. Voluntary adoption opened on 1 July 2026.
So going early carries no penalty risk while you test. The exclusion ends on your mandatory date. From then on, every rule above applies to you.
Who is due when
| Who | Appoint an ASP by | Go live by |
|---|---|---|
| Businesses with revenue of AED 50m or more | 30 October 2026 (passed) | 1 January 2027 |
| Businesses under AED 50m | 31 March 2027 | 1 July 2027 |
| Government entities | 31 March 2027 | 1 October 2027 |
The AED 50m dates come from Ministerial Decision No. 66 of 2026, which amended Ministerial Decision No. 244 of 2025. The other dates come from the Ministry's guidelines. Our quarter-by-quarter timeline breaks the work down by month.
The ASP date has passed: what to do now
If your revenue is AED 50m or more and you have not appointed an ASP, you are already outside the timeline. Go-live is on 1 January 2027, from today. Because violation 1 names the missing ASP explicitly, appoint one now and confirm with your tax adviser how the first-instance charge applies to your dates.
- Pick and contract an ASP this week. Use the official list of accredited service providers. Do not wait for the perfect provider.
- Start onboarding in EmaraTax. The guidelines say the business, not the ASP, starts onboarding through the FTA's EmaraTax system. Your Peppol participant ID is issued through the ASP.
- Map your ERP data to the mandatory fields. TRN, tax category, unit of measure and AED amounts are where most rejections start. Our PINT AE guide lists the fields.
- Test end to end before 1 January. Send real invoice and credit note scenarios through the ASP, including exports, free zone sales and partial credits.
- Name an owner for rejections. A rejected invoice has not been issued, and unissued invoices are violation 2.
Under AED 50m? You have until 31 March 2027 to appoint and 1 July 2027 to go live. That is enough time to do it properly, but not enough to start in March.
How to stay clear of penalties after go-live
- Issue every B2B and B2G invoice from the ERP through the ASP. No side invoices from spreadsheets.
- Correct issued invoices with electronic credit notes, never by editing or deleting. Violation 3 is per credit note.
- Give one person the job of telling the ASP about changes to your FTA data, such as a new address or trade licence. Violation 4 runs by the day.
- Reconcile reported invoices to the ledger and the VAT return every month. Our guide to record-keeping and audit readiness covers the controls.
Where Kaido fits
Kaido is not an ASP and does not sell one. We connect the ERP you run, such as Odoo, NetSuite, SAP Business One, Dynamics 365 Business Central or Zoho, to the ASP you choose, then clean the data and test it. Start with the 2-minute readiness check or read how our UAE e-invoicing readiness review works.
Frequently asked questions
What is the penalty for not implementing UAE e-invoicing on time?
Under Cabinet Decision No. 173 of 2026 it is AED 5,000 for the first instance and AED 5,000 for each month or part of a month that non-compliance continues, capped at AED 50,000 in any 12 consecutive months. Failing to appoint an Accredited Service Provider is part of the same violation.
Is failing to appoint an ASP a separate fine from late implementation?
No. The decision lists failure to implement the system, including failure to appoint an Accredited Service Provider, as one violation with one penalty scale.
Do penalties apply to businesses that adopt e-invoicing voluntarily?
No. Article 2(2) of the decision excludes voluntary adopters. The Ministry's guidelines say penalties apply only from the date a business is required to implement e-invoicing.
Does Cabinet Decision 106 of 2025 still apply?
No. Cabinet Decision No. 173 of 2026 repeals it. The new decision comes into force on the day after its publication in the Official Gazette.
What are the per-invoice penalties?
AED 100 for each e-invoice or electronic credit note not issued and transmitted through the system, each capped at AED 5,000 per calendar month. Not notifying your ASP of changes to FTA-registered data costs AED 250 per day, capped at AED 5,000 per calendar month.
We are over AED 50m and missed 30 October 2026. What now?
Appoint an ASP immediately, start onboarding in EmaraTax, map and test your ERP data, and aim to go live on 1 January 2027. Confirm with your tax adviser how the first-instance charge applies to your dates.
Related reading
Sources
- Cabinet Decision No. 173 of 2026 (English PDF), Ministry of Finance
- Ministerial Decision No. 66 of 2026 amending MD 244 of 2025 (English PDF)
- UAE Electronic Invoicing Guidelines, Ministry of Finance (sections 8.2, 8.3 and 9)
- Ministry of Finance eInvoicing page (legislation list)
- Gulf News, 30 October 2026: UAE updates e-invoicing penalty rules
Last checked 6 November 2026 against the Ministry of Finance.
Not sure where your business stands?
A free 30-minute call on Google Meet with an industry expert. We look at your ERP, your dates and your data, and tell you what to do first.