UAE to launch pilot phase of electronic invoicing system from July 2026

The Ministry of Finance will launch the pilot phase of the UAE’s electronic invoicing (e-invoicing) system on July 1, 2026, marking a major milestone in the country’s digital transformation agenda.

Announcing the move during an awareness event held in partnership with the Federal Tax Authority (FTA), the ministry said the unified e-invoicing framework is designed to add value for both businesses and government entities by reducing costs, improving operational efficiency, and increasing accuracy across the invoicing lifecycle.

The system will automate the creation, exchange, and verification of invoices, enabling faster transaction processing, stronger cash flows, and improved working capital management. Officials said small and medium-sized enterprises are expected to benefit significantly from the streamlined process.

Boosting transparency and compliance

Beyond operational efficiency, the e-invoicing system is expected to enhance transparency and simplify tax audits conducted by the FTA. Advanced security features are intended to reduce fraud risks while strengthening corporate credibility.

The ministry added that access to reliable transaction data would support financing opportunities for businesses and facilitate cross-border trade, aligning the UAE with international digital invoicing standards.

How the pilot phase will work

The pilot phase will initially apply to a selected group of taxpayers, after which the system will be rolled out in three mandatory implementation stages.

• Businesses with annual revenues of Dh50 million or more
• Appoint an accredited service provider by July 31, 2026
• Fully implement e-invoicing by January 1, 2027
• Businesses with revenues below Dh50 million
• Appoint a provider by March 31, 2027
• Complete implementation by July 1, 2027
• Government entities
• Appoint a provider by March 31, 2027
• Fully implement the system by October 1, 2027

Officials underline strategic importance

Younis Haji Al Khoori, undersecretary at the Ministry of Finance, said the initiative represents a strategic step toward building an integrated digital financial ecosystem.

“The e-invoicing system will improve efficiency, strengthen transparency, and support tax compliance, while contributing to the UAE’s broader economic competitiveness,” he said.

Khalid Ali Al Bustani, Director General of the FTA, said the system would enhance voluntary tax compliance by simplifying invoicing through a secure, automated framework aligned with global best practices.

Penalties for non-compliance

Administrative penalties for non-compliance are outlined under Cabinet Resolution No. 106 of 2025.

Fines include:

• Dh5,000 per month for failing to appoint an accredited service provider or implement the system within the required timeframe

• Dh100 per missing or delayed electronic invoice, capped at Dh5,000 per month

The Ministry of Finance confirmed that businesses that adopt the system voluntarily will be exempt from penalties until mandatory implementation applies.