UAE Updates E-Invoicing Penalties Under Cabinet Decision No. 173 of 2026

On October 30, 2026, the UAE Ministry of Finance announced Cabinet Decision No. 173 of 2026, amending administrative penalties governing the UAE Electronic Invoicing System. According to the announcement reported by WAM and published by Naqood, the new decision completely repeals Cabinet Decision No. 106 of 2025 and introduces a revised penalty schedule.

Under the new framework, the monthly penalty of AED 5,000 for failing to implement e-invoicing or failing to appoint an Accredited Service Provider (ASP) on time is now capped at AED 50,000 over any 12 consecutive months. The previous table under Decision No. 106 of 2025 had no stated cap. In addition, the fine of AED 1,000 per day for failing to notify the Federal Tax Authority (FTA) of a system failure has been removed entirely.

The penalty for failing to notify an ASP of changes to data registered with the FTA has been lowered from AED 1,000 per day of delay to AED 250 per day, with a ceiling of AED 5,000 per calendar month. Meanwhile, fines for failing to issue and transmit an e-invoice or electronic credit note through the system remain at AED 100 per document, subject to a monthly cap of AED 5,000 per document type.

The decision directly covers both invoice issuers and recipients. A failure by an issuer or recipient to implement the system, or a failure by a recipient to maintain compliance obligations after implementation, both fall under the AED 50,000 annual cap. Under Article 3, entities acting as both issuer and recipient in respect of the same violation cannot be penalised twice for that single violation.

Statutory implementation timelines remain unchanged. Businesses with annual revenue of AED 50 million or more were required to appoint an ASP by October 30, 2026, and must implement the system by January 1, 2027. Businesses below that threshold must appoint an ASP by March 31, 2027, and achieve full implementation by July 1, 2027.