UAE sets new rules, deadlines for businesses on using digital invoices

Dubai: The Ministry of Finance has issued two new decisions that explain how and when businesses in the UAE must start using an Electronic Invoicing System.

This is part of the UAE’s plan to move towards a fully digital economy and make doing business easier, faster, and more transparent.

What is Electronic Invoicing System?

This new system will require businesses to issue and receive invoices electronically (online) instead of using paper invoices. It applies to all business-to-business (B2B) and business-to-government (B2G) transactions, unless specific exceptions are announced.

Businesses can also choose to use electronic invoices voluntarily, even if they’re not required to.

Key requirements for businesses:

• Businesses must appoint an Accredited Service Provider (ASP) to help them send and receive electronic invoices.

• A list of approved service providers will be shared by the Ministry of Finance.

• For every business transaction, an electronic invoice must be issued.

• If an invoice needs to be corrected or canceled (like in the case of refunds, changes in price, or mistakes), an electronic credit note must be issued.

• Both the sender and the receiver of the invoice must follow the rules using their chosen Accredited Service Provider.

• Invoices must include specific required information, as set by the Ministry.

The system is based on an international standard called Peppol, which is used by many countries. This helps UAE businesses trade easily with partners abroad and reduces time, errors, and paperwork.

When does it start?

The system will be rolled out in phases:

• Pilot Phase: Starts July 1, 2026 with a selected group of businesses.

• From January 1, 2027: Mandatory for businesses with annual revenue of Dh50 million or more. These businesses must choose an Accredited Service Provider by 31 July 2026.

• From July 1, 2027: Mandatory for businesses with less than Dh50 million in annual revenue. These businesses must choose an Accredited Service Provider by March 31, 2027.

• From October 1, 2027: Mandatory for all government entities, who must appoint an Accredited Service Provider by March 31, 2027.

These new rules will help UAE businesses save time, reduce errors, lower costs, and make tax and financial reporting more efficient. It also shows the UAE’s strong commitment to becoming a fully digital and business-friendly economy.

For more information and updates, businesses are encouraged to follow official announcements from the Ministry of Finance.