The UAE is digitalizing the way businesses issue, transmit, and manage invoices through a formalized digital framework. Ministerial Decision No. 244 of 2025 on the Implementation of the Electronic Invoicing System provides the operational backbone for the e-invoicing UAE law, setting out clear timelines, technical requirements, and application rules that all taxable persons and entities subject to the Federal Tax Authority must follow.
This Decision operates in tandem with other important legislative tools like the Federal Decree-Law No. 8 of 2017 on Value Added Tax and the Federal Decree-Law No. 28 of 2022 on Tax Procedures to make up the foundational buildings of the UAE’s legal framework in the area of digital tax compliance.
Purpose and Legal Basis of the Decision
The core purpose of the Ministerial Decision No. 244 of 2025 is related to determining how the electronic e-invoicing framework would be implemented in practice. The decision provides a guarantee that all invoices and credit notes are sent and received in an electronic form that promotes and supports efficiency and efficacy in tax administration, as provided for in the law of e-invoicing in the UAE.
The Decision:
- Formalizes a phased implementation timeline.
- Provides for voluntary and pilot programs of adoption
- Helps to clarify the duties owed by the corporate sector and government bodies
- Ensures that it complies with technical requirements set by FTA and reporting standards
The Decision has been published and shall take effect upon publication thereof in the Official Gazette.
Who Must Comply? Scope of Application
Article 2 of the decision clearly states that the decision applies to:
- Any person subject to the Electronic Invoicing System in the UAE
- Any person who voluntarily operates the system
- Any other persons as determined by the Ministry of Finance.
This means that when a business falls under the purview of the e-invoicing UAE law, it is required to implement the prescribed process for electronic invoicing. However, Business to Consumer (B2C) transactions are, for the time being, not included in the compulsory regulatory environment.
Pilot Programme Explained
The decision introduces a Pilot Programmed before its full mandatory adoption:
- The pilot runs for selected businesses from 1 July 2026
- Participants must be notified in writing and agree to technical compliance standards
- All technical requirements for using the Electronic Invoicing System apply during the pilot phase
This pilot phase enables early readiness evaluation and testing before the rollout deadlines.
Voluntary Implementation
Article 4 further allows any business to adopt the system on a voluntary basis from 1 July 2026. Even in the voluntary phase, the same technical and operational requirements are applied. Early adopters must therefore fully comply with system standards under the e-invoicing UAE law.
On the one hand, the voluntary nature of the implementation lends certain advantages to businesses;
- Early compliance testing
- Smoother transition to compulsory phases
- Ability to operationalise internal processes before legal deadlines
Mandatory Implementation Phases
The Decision set out a phased timeline for mandatory implementation dependent on the revenue and the legal form of the entities.
Before mentioning the details of the phases, it has to be noted that this rolling out ensures that the system is first implemented by large businesses, giving small businesses more time to prepare.
Mandatory Phases Under Article 5:
Phase I:
Businesses with revenue ≥ AED 50,000,000 have to appoint an Accredited Service Provider (ASP) by 31st July 2026
Completion of the system installation by 1 January 2027
Phase II:
Companies with less than AED 50,000,000 in revenue are required to nominate an ASP latest by 31 March 2027
Completely implemented by July 1, 2027
Phase III:
The government bodies are required to appoint an ASP by 31 March 2027
Implement by 1 October 2027
After these phases, all other person and government bodies that are bound by the system are obligated by appointment and implementation terms as determined by the Ministry.
These provisions give a road map to the business community to comply with the law in their billing systems.
Technical and Operational Requirements
Although Decision No. 244 emphasizes implementation timing and applicability, it necessarily operates in conjunction with other e-invoicing regulations (including Ministerial Decision No. 243 of 2025), which set the following technical requirements:
- Mandatory use of e-invoices and e-credit notes in organized digital form
- Secure storage of e-invoice information data in UAE
- Disclosure of electronic invoice information to the FTA
- Utilization of recognized transmission service providers for transmission of e-invoices and credit notes
The operational expectations under the e-invoicing law of UAE also comprise:
- Securing archival systems for invoices and related information
- Notification of system failures to FTA within specified timelines
- Compliance with Data Retention Obligations Under the Tax Procedures Law
These operations are ensured by the digitized billing process that will be safe and audit-compliant.
Exclusions and Special Rules
While it is generally true that the Decision has universal applicability, some transactions may initially lie beyond its mandatory applicability. These include:
- On the other hand, Business-to-Consumer (B2C) e-invoicing is also exempted from mandatory e-invoicing until further instructions are
Exemptions help the business understand what falls within the rules today and what can be phased in later.
Legal Enforcement and Relation to Penalties
The framework of implementation of Ministerial Decision No. 244 of 2025 operates in cooperation with the Cabinet Resolution Regarding Violations and Administrative Fines Related to the Electronic Invoicing System. The Resolution includes administrative fines regarding the obligation to:
- Implement the system by the deadline
- Issuing or transmitting e-invoices or credit notes correctly
- Notify the FTA of System Issues
- Update registered data with appointed service providers
This legal linkage ensures that non-compliance with the implementation rules also carries enforceable consequences, reinforcing the e-invoicing UAE law as a compliance obligation.
Practical Implications for Businesses
The application of the Electronic Invoicing System through the ministerial decision numbered 244 in the year 2025 implies that the following activities must be conducted by
- Evaluate their readiness using revenue streams and activities
- Plan for accreditation or onboarding with the approved service provider.
- Implement internal systems able to deliver compliant e-invoices and credit notes
- Make record-keeping, tax returns, and audits processes to electronic reporting norms
It is essential to prepare in advance in order to not affect operations when the deadlines arrive.
Conclusion
Ministerial Decision number 244 in the year 2025, regarding the implementation of the Electronic Invoicing System, provides a road map on implementing the e-invoicing UAE law mandatorily in the business community. Thus, it provides clarity on timelines, applicability, and implementation in a manner that will increase efficiencies through the implementation of e-invoicing.
To these changes, businesses must plan beforehand and perhaps take the advice of professional advisors to comply accordingly.
FAQs
- What is the subject of Ministerial Decision No. 244 of 2025?
Ministerial Decision No. 244 of 2025 details how and by what date the Electronic Invoicing System is to be adopted in the UAE. It details who must comply, the timelines for phased rollout, options for pilot and voluntary adoption, and how businesses should transition under the law on e-invoicing UAE.
- When does e-invoicing become mandatory in the UAE?
Its implementation is regarded to be phased in. Larger businesses whose annual revenue is AED 50 million and above have an earlier compliance date, while smaller businesses have later deadlines; so, too, government entities. The first phase of compulsory implementation begins in January 2027, following pilot and voluntary stages commencing July 2026, as prescribed under the e-invoicing UAE law.
- Can a business implement e-invoice systems before they become mandatory?
Yes. The decision allows for voluntary implementation as from the 1st of July, 2026. However, the businesses adopting earlier have to comply with the technical and operational requirements of the law of e-Invoicing in the UAE, just like the mandatory adopters.
- Are all transactions included in the Electronic Invoicing System?
The current system mostly affects B2B (Business-to-Business) and B2G (Business-to-Government) e-invoicing. The B2C (Business-to-Consumer) e-invoicing process is yet to be mandatory in the UAE until an e-invoicing.
- What are the consequences if an organization fails to implement within the timeframe? Inability to adopt the Electronic Invoicing System within the stipulated timeframe may pose financial risks in terms of administrative fines and penalties as per the relevant Cabinet Decisions. It will also pose risks in terms of audits as per the Electronic Invoicing UAE law.