Cabinet Decision No. 106 of 2025 sets administrative penalties for e-invoicing. Summaries report AED 5,000 for each month or part of a month in which a business fails to implement the system or appoint an Accredited Service Provider, AED 100 for each invoice not issued or transmitted properly, capped at AED 5,000 a month, and AED 1,000 a day for failing to report a system failure.
The reported penalty schedule
| Breach | Reported penalty |
|---|---|
| Failing to implement the system or appoint an ASP on time | AED 5,000 for each month or part of a month of delay |
| Failing to issue or transmit an e-invoice or credit note as required | AED 100 per invoice, up to AED 5,000 in a calendar month |
| Failing to notify the authority of a system failure | AED 1,000 for each day of delay |
This schedule follows a summary of the decision by BDO and similar sources. Always read the decision itself and any later amendment, because penalty rules have changed several times in recent years.
Where sources disagree
- Start date of the monthly penalty: one source says the clock starts on 30 October 2026, another on 1 August 2026 if no provider is appointed by 30 October. The decision text and the Ministry's amendment decide.
- Higher figures: some websites quote fines of AED 2,500 to AED 50,000 per invoice. These do not match the schedule above and we have not found the official basis for them.
- Old dates: some pages still use the superseded 31 July 2026 date.
When sources conflict, rely on the text in the Official Gazette or on the Ministry of Finance website, and note the date you checked.
Early and voluntary adopters
Several sources report that businesses that join voluntarily before their mandatory date do not face the penalties for the period before their mandatory date. The system opened for voluntary use on 1 July 2026. Confirm this in the decision text before relying on it as a reason to delay your own preparation.
How to limit your exposure
- Appoint an ASP before your deadline. See the 30 October 2026 guide.
- Test every invoice scenario before go-live.
- Set up monitoring so a failed or rejected invoice is seen the same day.
- Write a procedure for system failures, including who notifies the authority and how.
- Keep logs of invoice status and acknowledgements.
How e-invoicing penalties sit with other VAT penalties
These penalties are separate from the VAT return and payment penalties. A business can be penalised for each type of breach. See VAT penalties in the UAE and tax invoice requirements. We do not handle penalty disputes with the authority as a regulatory body; we prepare the records that support your position.
Questions to ask your adviser
- Which entity is in which phase, and what is each deadline?
- Which penalty applies first if we are late?
- How do we document a system failure?
- What happens to invoices rejected by the network?
A worked scenario
A distributor with revenue above AED 50 million has not appointed a provider by 30 October 2026. On the reported schedule, a monthly penalty of AED 5,000 applies for each month or part of a month of delay. If the distributor appoints in the middle of November and goes live on 1 January 2027, the exposure depends on how the decision counts the delay and whether the monthly penalty ran before the appointment. After go-live, if the distributor sends 200 invoices outside the system in a month, a per-invoice penalty of AED 100 would give AED 20,000 before the cap of AED 5,000 for that month. The cap limits that line of exposure, but the figures show why a manual fallback is not a plan. These are illustrations based on reported amounts, not advice on a specific case.
Evidence that helps if you are challenged
- The signed appointment and its date.
- Project plans and test records.
- System logs showing failures and the time they were reported.
- Correspondence with the provider about outages.
- Proof that rejected invoices were corrected and resent promptly.
Disputing a penalty
Administrative penalties can be challenged through the authority's reconsideration and appeal procedures, with time limits set in the tax procedures law. Because the e-invoicing penalty regime is new, expect guidance to develop. Keep your records organised from day one, and take advice before you pay or dispute a penalty you do not understand.
Frequently asked questions
Summaries of Cabinet Decision 106 of 2025 report AED 5,000 for each month or part of a month of delay in implementing the system or appointing an ASP.
A reported AED 100 per invoice, capped at AED 5,000 in a calendar month.
A reported AED 1,000 per day of delay in notifying the authority.
Several sources say voluntary participants before their mandatory date are not penalised. Confirm in the decision text.
Some use outdated dates or unverified figures. Rely on the decision text and Ministry announcements.
Yes. They are separate breaches with their own penalties.