Your VAT rates and VAT returns stay the same. SMEs with revenue below AED 50 million go live on 1 July 2027 (dates are in UAE E-Invoicing 2027: Deadlines by Phase and What SMEs Must Do Before 31 March). This guide covers what changes on the documents themselves, with worked examples for advances and retentions.
What changes on the invoice itself?
The invoice stops being a document and becomes data. Your ERP sends the invoice data to your ASP, which converts it to PINT AE format, checks it and delivers it to your customer's ASP. A PDF, scan or emailed file no longer counts as the invoice.
| Today | After your go-live date | |
|---|---|---|
| Format | PDF, paper or email | XML in PINT AE format |
| Delivery | Email, courier or a customer portal | Your ASP to the buyer's ASP over Peppol |
| Content | VAT Law tax invoice details | 51 mandatory fields for a tax invoice |
| Buyer identification | Name, address and TRN | The same, plus the buyer's Peppol electronic address |
| Reporting to the FTA | Totals in your VAT return | Tax data reported by your ASP for each invoice |
| Invoices with no VAT | Ordinary invoice | Commercial e-invoice |
The Ministry of Finance published the mandatory field list on 23 February 2026. Beyond the usual seller, buyer and amount details, it adds line-level data such as unit of measure, tax category and AED amounts, and flags for free zone, margin scheme and deemed supplies.
Two things are not required: UAE e-invoices carry no QR code and no digital signature. A commercial e-invoice is used for supplies that need no tax invoice, such as exempt or out-of-scope supplies, or sales by a business that is not VAT registered.
How quickly must an e-invoice be issued?
Issue and send each e-invoice within 14 days. The clock starts on the date of supply under the VAT Law or, if you are not VAT registered, on the date of the business transaction (Article 6 of Ministerial Decision No. 243 of 2025).
The date of the business transaction is the earlier of the day the transaction happens and the day you receive payment for it. Payment received before delivery therefore starts the clock.
Worked example. You deliver goods on 3 August 2027 and have received no payment. Your e-invoice must be issued and sent by 17 August 2027. Each invoice not issued and sent on time can cost AED 100, up to AED 5,000 per calendar month.
You do not report invoices to the FTA yourself: your ASP reports the tax data as part of the exchange.
During the transition, some customers will not yet be onboarded. In that case your ASP sends the e-invoice to a predefined endpoint (0235:9900000098), and you also send the customer a normal tax invoice, such as a PDF.
When must you issue an e-credit note?
You must issue an e-credit note in four situations set out in Article 6 of Ministerial Decision No. 243 of 2025, on the same timeline as an invoice. The credit note goes through your ASP and must reference the invoice it corrects.
| Trigger | Example |
|---|---|
| The transaction is cancelled | A customer cancels an order you have already invoiced |
| The agreed price is reduced | You give a 5% discount after invoicing |
| Payment is returned in full or in part | Goods are returned and you refund the customer |
| There is an administrative or numerical error | The invoice shows the wrong quantity or rate |
Three habits need to stop:
- Negative invoices. A minus-value invoice is not an e-credit note. Raise a credit note against the original.
- Cancel and reissue in the ERP only. Once an e-invoice has been sent, deleting it in your system does not recall it. Correct it with a credit note, then issue a new invoice if needed.
- Credit notes typed outside the system. A credit note created in Word or Excel cannot reach your ASP.
The Ministry's guidelines allow one e-credit note to adjust several earlier invoices, which helps with period-end rebates.
How do advances and retentions work?
The Ministry's guidelines (version 1.1, 1 June 2026) require an e-invoice when you receive an advance, and allow an e-invoice for only the amount payable now when part of a bill is retained. The figures below use 5% VAT.
Worked example 1: an advance. A customer orders equipment worth AED 100,000 and pays a 30% advance.
| Event | E-invoice | Net (AED) | VAT (AED) | Total (AED) |
|---|---|---|---|---|
| Advance received | Tax invoice for the advance | 30,000 | 1,500 | 31,500 |
| Delivery | Tax invoice for the balance only | 70,000 | 3,500 | 73,500 |
Worked example 2: a retention. A contractor bills AED 200,000 of progress, and the client holds back 10% until handover.
| Event | E-invoice | Net (AED) | VAT (AED) | Total (AED) |
|---|---|---|---|---|
| Progress bill | Tax invoice for the amount payable now | 180,000 | 9,000 | 189,000 |
| Retention released | Separate tax invoice | 20,000 | 1,000 | 21,000 |
Other cases need their own setup in your ERP:
- Exports: tax invoices for exports are e-invoices. If the overseas buyer has no Peppol address, your ASP uses the predefined endpoint 0235:9900000099.
- Deemed supplies: gifts and free goods that carry VAT are flagged as deemed supplies.
- Self-billing: where your customer issues the invoice on your behalf, it is a self-billed e-invoice.
What records must you keep, and where?
You must keep every e-invoice, e-credit note and the data linked to them for the period set by the Tax Procedures Law, and be able to give them to the FTA on request. To be safe, keep them for at least seven years (Corporate Tax requires seven years after the end of the tax period; VAT's general minimum is five), and 15 years for records about real estate.
Where you store them is now your choice. Ministerial Decision No. 197 of 2026, effective from 1 October 2026, removed the earlier rule that e-invoice data had to be stored inside the UAE. You may also let your ASP store the records, but the legal responsibility for keeping them stays with you.
Keep these together for each invoice:
If your ASP stores the records, put the retention period and an export right into the contract. Records you cannot retrieve after changing provider are records you cannot show the FTA.
Which ERP settings should you change first?
When we prepare HYP ERP customers for e-invoicing, master data takes longer than the connection to the ASP. Start with the settings that every invoice depends on.
| Setting | What to change | Why |
|---|---|---|
| Customer master | Add each B2B customer's TRN and Peppol electronic address | Without them the e-invoice cannot be delivered |
| Item master | Set a unit of measure and a VAT category on every item | These are mandatory line-level fields |
| Invoice types | Separate tax invoices from commercial invoices | Each is a different e-invoice type |
| Credit note reasons | Map your reason codes to the four legal triggers | Every credit note can be traced to a legal trigger |
| Advance receipts | Raise a tax invoice when an advance is received | Required by the Ministry's guidelines |
| Retentions | You may bill the net payable amount and invoice the retention on release | The guidelines allow this treatment |
| Branches and POS | Route every B2B invoice through the central ERP | One route to the ASP, one set of records |
Test each setting with real invoices from last month before your ASP goes live. A rejected test invoice in May costs nothing; a rejected live invoice in July can cost AED 100.
Sources
- Ministerial Decision No. 243 of 2025 on the Electronic Invoicing System
- Ministerial Decision No. 197 of 2026 amending Decision No. 243
- Ministry of Finance: amendments to the e-invoicing regulations, 19 October 2026
- UAE Electronic Invoicing Guidelines, version 1.1, 1 June 2026
- KPMG: UAE technical guidance on mandatory e-invoicing fields, 24 February 2026
- KPMG: Ministry of Finance issues detailed implementation guidelines