UAE Strengthens E-Invoicing Rules: Cabinet Decision 106/2025 

The UAE has taken another major step in its digital tax transformation with Cabinet Decision No. 106 of 2025, issued on 24 November 2025. 
The Decision introduces a full set of violations and administrative penalties for businesses that fail to comply with the Electronic Invoicing System — a framework built under Federal Decree-Law No. 28 of 2022 on Tax Procedures. 

What Changed 

The Decision sets out six key violations, each tied to specific penalties, ensuring the system operates with accuracy, timeliness, and structured digital reporting. 
This move strengthens transparency and positions the UAE firmly in line with global e-invoicing standards. 

Key Features 

• Mandatory e-invoicing implementation: AED 5,000 per month for late adoption.
• Late transmission of e-invoices: AED 100 per invoice (capped monthly). 
• Late e-credit notes: Same penalty structure as invoices. 
• System failure reporting delays: AED 1,000 per day.
• Failure to update registered data: AED 1,000 per day. 
• Applies only to entities required to use the system—voluntary participants are excluded. 

Why It Matters  

The Decision reshapes operational responsibilities: 
Operational: ERP integration and real-time transmission are now mandatory. 
Financial: Penalties accumulate monthly or daily, creating costly risks for delays. 
Reputational: Compliance reflects digital readiness and controls—a key expectation for regulators. 

Next Steps: 

Finalize onboarding with an FTA-accredited service provider. Automate invoice and credit note generation + transmission. Establish internal procedures for system failure detection and reporting. Maintain up-to-date registered data at all times. 

Conclusion

Cabinet Decision No. 106 of 2025 signals strict enforcement in the UAE’s e-invoicing landscape. 
Businesses that prepare early will maintain compliance effortlessly — while others face recurring monthly and daily penalties.  2026 and beyond will demand precision, integration, and zero delays. 

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