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The UAE will begin the pilot phase of its e-invoicing system from July 1, followed by a phased mandatory rollout, starting with businesses generating over Dh50 million in annual revenue, a senior Federal Tax Authority (FTA) official said during an ICAI Dubai Chapter event in Dubai on Saturday.

The move marks a major step in the country’s transition towards a fully digital tax system, aimed at improving transparency, streamlining reporting, and strengthening compliance across sectors.

Speaking to Khaleej Times at the event, Mariam Abdullah Al Matroushi, board member at the Federal Tax Authority (FTA) and deputy director at Fujairah Finance Department, said the rollout will be carried out in phases.

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“The first phase will begin on July 1, 2026, covering businesses with annual revenues exceeding Dh50 million. This will be followed by a second phase in January 2027, bringing smaller businesses under the system. A final phase, expected by late 2027, will cover business-to-government transactions, with full implementation across all segments projected from January 2028,” added Al Matroushi.

Officials said businesses must begin preparing immediately by aligning their systems and working with accredited service providers, as the transition will require integration with approved digital platforms.

Industry experts said the shift will not change the nature of transactions but will transform how they are recorded and reported.

“E-invoicing is not about changing how businesses operate, but about how transactions are captured and reported in real time,” said Rishi Chawla, chairman of ICAI Dubai Chapter. He explained that invoices will be validated through accredited service providers before being shared between buyer and seller and reported to the authorities.

Rishi Chawla, Chairman of ICAI Dubai Chapter

Under the new system, invoices will be digitally transmitted and checked through a structured network, reducing the chances of errors, delays, or missing records.

Experts said the system is expected to improve overall transparency and make it harder for businesses to misreport financial data.

“This is a shift from awareness to preparedness,” said Amit Khaitan, vice-chairman of ICAI Dubai Chapter. “Businesses need to align their systems, processes, and mindset, as this is not something that can be implemented overnight.”

Amit Khaitan, vice-chairman of ICAI Dubai Chapter

He added that the move could also help address common challenges such as delayed payments, as digitally recorded invoices will reduce disputes related to missing or late documentation.

The system will follow international standards such as Peppol, widely used in Europe, allowing secure and standardised exchange of invoice data between businesses and authorities.

Experts said the system is expected to improve transparency across transactions and reduce discrepancies in financial reporting, as invoices are validated and recorded in real time.

“E-invoicing will bring greater control and visibility into the system, as every transaction gets captured and reported through a structured network,” said Chawla.

He added that the shift could also improve cash flow and ease access to finance, with banks likely to have greater confidence in verified financial data while authorities process VAT-related matters more efficiently. 

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