Ministry of Finance (UAE) has announced the issuance of two Ministerial Decisions clarifying the scope of obligations and timelines for the implementation of the country’s new Electronic Invoicing System. The move marks a significant milestone in the UAE’s digital transformation journey and aims to enhance efficiency, transparency, and compliance in business transactions nationwide.
Scope of Obligations
The first decision sets out that the Electronic Invoicing System applies to all persons conducting business in the UAE for business-to-business (B2B) and business-to-government (B2G) transactions, except in cases where specific exclusions have been identified. Businesses not covered by the mandatory scope may voluntarily issue, send, share, exchange, and report electronic invoices and credit notes.
To support smooth implementation, both issuers and recipients of invoices must appoint an Accredited Service Provider (ASP). The Ministry will publish a list of accredited service providers in due course.
Under the new requirements, an electronic invoice must be issued and transmitted for every business transaction. An electronic credit note must be issued in cases of cancellation, reduction in agreed consideration, refunds in full or in part, or when an administrative or numerical error occurs. Recipients are required to process all electronic invoices and credit notes through the Electronic Invoicing System.
Both issuers and recipients must meet their obligations through their appointed Accredited Service Provider. All electronic invoices and credit notes must contain the required data fields and particulars prescribed by the Ministry of Finance.
The system is built on the OpenPeppol standard, a globally recognised framework for the exchange of electronic documents. Adopting Peppol ensures interoperability with international business communities, facilitates cross-border trade, reduces administrative costs, and improves compliance efficiency. It also enhances security, ensures data integrity, and enables faster and more accurate exchange of invoices between businesses and government entities.
Timelines
The second Ministerial Decision provides details on the phased implementation timeline. A Pilot Programme will begin on 1 July 2026 with a selected group of taxpayers. Following the pilot, mandatory adoption will be rolled out in stages:
- Businesses with annual revenue equal to or exceeding AED 50,000,000 must appoint an Accredited Service Provider by 31 July 2026 and implement the system from 1 January 2027.
- Businesses with annual revenue below AED 50,000,000 must appoint an Accredited Service Provider by 31 March 2027 and implement the system from 1 July 2027.
- In-scope government entities must appoint an Accredited Service Provider by 31 March 2027 and implement the system from 1 October 2027.
This phased approach is designed to support a smooth transition for businesses while ensuring compliance with the legal framework.
These decisions reflect the UAE’s commitment to international best practice, improving ease of doing business, and advancing the country’s shift toward a fully digital economy.