As the UAE continues its ambitious journey towards a fully integrated digital economy, the implementation of a mandatory Electronic Invoicing System (EIS) marks a significant milestone. With the first phase set to launch in July 2026, the Ministry of Finance has recently provided crucial clarity by issuing Cabinet Resolution No. 106 of 2025, which details the administrative penalties for non-compliance.
For businesses across the UAE, understanding these new requirements is not just a matter of compliance—it’s a strategic imperative. At Integrity Accounting Services, we believe that proactive preparation is key to a seamless transition. This guide breaks down what you need to know about the new e-invoicing penalties and outlines the immediate steps you should be taking.
Cabinet Resolution No. 106 of 2025 introduces a structured penalty system designed to ensure timely and accurate adoption of the EIS. The penalties are clear and significant:
| Violation | Penalty |
|---|---|
| Failure to Implement EIS | AED 5,000 per month |
| Failure to Appoint Approved Service Provider | AED 5,000 per month |
| Incorrect E-Invoice/Credit Note | AED 100 per document (capped at AED 5,000/month) |
| Failure to Report System Malfunction | AED 1,000 per day |
| Failure to Report Data Modification | AED 1,000 per day |
It is important to note that these penalties apply to all entities mandatorily required to implement the EIS. Businesses that adopt the system voluntarily are exempt from these fines until they fall under the mandatory scope.
The Federal Tax Authority (FTA) has already activated its e-invoicing onboarding service, signaling that the time for preparation is now. Here is a clear, 3-step action plan to guide your business towards compliance.
Step 1: Register for Onboarding with the FTA
This is your foundational step. By registering your business on the FTA’s e-invoicing portal, you officially enter the ecosystem and signal your readiness to comply. This ensures you receive all relevant communications and are recognized within the system as you move forward. We recommend completing this registration immediately to avoid any last-minute administrative hurdles.
Step 2: Select and Appoint an Approved Service Provider
The technical complexities of integrating with the FTA’s EIS require specialized expertise. The law mandates that businesses either implement the system themselves or appoint an FTA-approved service provider. For most businesses, partnering with an approved provider is the most efficient and reliable path to compliance. These providers offer solutions that are pre-certified to meet all technical and legal requirements, reducing your implementation risk.
When selecting a provider, consider factors such as their experience in the region, the scalability of their solution, and their integration capabilities with your existing ERP or accounting software.
Step 3: Conduct a Comprehensive Systems & Process Assessment
Before you can implement a solution, you must understand your current state. A thorough gap analysis of your existing invoicing, financial, and IT systems is crucial. This assessment should answer key questions:
This assessment will become the blueprint for your implementation project, helping you to allocate resources, set realistic timelines, and ensure a smooth transition.
The transition to mandatory e-invoicing is more than a compliance exercise; it’s an opportunity to enhance efficiency, improve accuracy, and strengthen your financial processes. However, the path to compliance can be complex.
At Integrity Accounting Services, we merge local insight with global expertise to guide our clients through every step of this journey. From selecting the right technology partner to redesigning your internal workflows, our team is here to provide the strategic advice you need.
Don’t wait until the deadline is approaching. Contact us today to start building your e-invoicing strategy and ensure your business is ready for July 2026.
