The penalties are set by Cabinet Decision No. 106 of 2025, published on the Ministry of Finance site. There are three that matter to a small business:
- AED 5,000 for each month or part of a month of delay in implementing the system, including failing to appoint an accredited provider on time.
- AED 100 for each e-invoice or e-credit note not issued and transmitted on time, up to AED 5,000 per calendar month.
- AED 1,000 per day for failing to notify a system failure or a change in registered data on time.
Source: Cabinet Decision No. 106 of 2025, annexed table. Verified 14 October 2026.
Who they apply to
Any person who must use the system and does not, from their mandatory dates. For a business under AED 50 million that means from 31 March 2027 for the provider appointment, and from the go-live date for invoices. Does not apply to persons who use the system voluntarily, per Article 2(2) of the same decision.
The first penalty is the one to avoid
Failing to appoint a provider on time is charged by the month, or any part of a month, for as long as the failure lasts. It does not depend on how many invoices you issue. A freelancer with three invoices a month and a trading company with three thousand face the same monthly amount for the same delay. Appointing a provider is a form and an agreement; it is the cheapest penalty to avoid.
Late invoices and the monthly cap
Once you are live, each e-invoice or e-credit note not issued and transmitted on time carries a per-document amount, up to a monthly cap. "On time" is defined elsewhere:
The cap is per calendar month. A backlog cleared in one month is capped once; a backlog that drifts across month ends is capped in each.
Notifications
Two smaller duties carry a daily amount: telling the Federal Tax Authority about a system failure within the set time, and telling your provider when your registered details change. Both are easy to miss because nothing visible happens when you forget. Put them in whoever handles your tax registration's checklist.
If you have already missed the appointment date
- Appoint a provider now. Every month, or part of one, adds to the amount, so the delay itself is the cost.
- Keep the agreement date. It is the evidence that the failure ended.
- Ask a registered tax agent about the penalty position before paying or disputing anything. The decision sets amounts; it does not describe reductions or waivers.
Read the decision
The whole decision is three pages, and the penalties are in a table on the last one: Cabinet Decision No. 106 of 2025 (PDF). The scope and obligations it enforces are in Ministerial Decision No. 243 of 2025.