What is Cabinet Decision 106 of 2025?
Cabinet Decision 106 of 2025 is the UAE rulebook that sets administrative penalties for breaches of the new electronic invoicing system. It lists violations linked to e-invoice issuance, reporting, and record keeping. Fines range from AED 2,500 to AED 50,000 per violation, depending on the offence and whether it is repeated.
Why this decision matters for UAE businesses
The UAE is moving to a Peppol 5-corner DCTCE (Decentralized Continuous Transaction Control and Exchange) model for e-invoicing. Invoices will flow through an accredited service provider (ASP) in the PINT AE format, with tax data reported to the Federal Tax Authority (FTA) in near real time.
Cabinet Decision 106 of 2025 gives that system teeth. It works alongside Federal Decree-Law 16 of 2024 and 17 of 2024, plus Ministerial Decisions 243 and 244 of 2025. If your business issues B2B (business to business) or B2G (business to government) invoices, these penalties will apply once your phase goes live.
For the wider compliance picture, see our hub on FTA Compliance UAE, which maps every obligation by tax type and deadline.
Who is in scope?
All VAT-registered businesses and certain non-registered entities must follow the e-invoicing rules. Phase 1 covers companies with revenue of AED 50 million or more from January 1, 2027. Small and medium businesses follow on July 1, 2027. Government entities go live on October 1, 2027. A pilot runs in Q2 2026.
When do fines start?
Penalties apply from the date your phase becomes mandatory. Phase 1 entities must appoint an accredited ASP by October 30, 2026, so the FTA expects readiness well before go-live.
Cabinet Decision 106 of 2025 penalties at a glance
The decision groups violations by the type of obligation breached. The table below shows the fine bands published under the framework. Always check the official text on the Ministry of Finance website for the exact wording.
| Violation category | Fine band (AED) | Notes |
|---|---|---|
| Failure to issue a tax invoice through the e-invoicing system | 2,500 to 10,000 | Per invoice in some cases, with caps |
| Failure to transmit invoice data to the FTA on time | 5,000 to 20,000 | Repeat offences sit at the top of the band |
| Issuing an e-invoice with incorrect or incomplete data | 2,500 to 10,000 | Includes missing TRN (Tax Registration Number) or wrong totals |
| Failure to appoint an accredited ASP by the deadline | Up to 20,000 | Phase 1 deadline: October 30, 2026 |
| Failure to keep e-invoice records for the legal period | 10,000 to 50,000 | Records must be available for FTA audit |
| Obstructing FTA access to e-invoicing data | Up to 50,000 | Highest band, treated as a serious offence |
| Repeated violations within 24 months | Double the original fine | Subject to the AED 50,000 cap per violation |
How the AED 2,500 to AED 50,000 range works
The lower end of the scale targets one-off clerical errors, such as a missing field on a single invoice. The upper end is reserved for systemic failures, like never appointing an ASP, blocking an FTA audit, or destroying records. The FTA applies fines per violation, not per business, so the total exposure across a tax year can be significant.
How penalties stack with VAT and corporate tax fines
An e-invoicing breach can also trigger separate fines under the VAT and corporate tax laws. For example, a missing tax invoice may breach both Cabinet Decision 106 of 2025 and the wider VAT rules. Read our notes on UAE VAT penalties and UAE corporate tax penalties to see how the regimes interact.
Worked examples of Cabinet Decision 106 of 2025 penalties
The following scenarios show how fines could apply in real UAE businesses. Figures are illustrative and based on the published bands.
Example 1: SME issues paper invoices after go-live
A trading company with AED 10 million in annual revenue continues to send PDF invoices by email after July 1, 2027. The FTA finds 40 non-compliant invoices during an audit. At AED 2,500 per violation, the minimum exposure is AED 100,000. If the business has been warned before, the fine can double, subject to the AED 50,000 cap per violation.
Example 2: Large group misses the ASP appointment deadline
A construction group with AED 200 million in revenue does not appoint an accredited ASP by October 30, 2026. The FTA can fine the group up to AED 20,000 for that single failure, plus further fines once go-live arrives on January 1, 2027 and invoices are not transmitted.
Example 3: Repeated TRN errors
A retailer issues 15 e-invoices with the wrong buyer TRN over six months. Each error sits in the AED 2,500 to AED 10,000 band. The FTA may treat the pattern as a repeat violation and apply the upper end, exposing the retailer to roughly AED 150,000 in fines.
How to avoid Cabinet Decision 106 of 2025 penalties
Most fines come from three root causes: late ASP appointment, weak invoice data quality, and poor record keeping. A clear plan removes these risks well before your phase deadline.
Step 1: Map your obligations
- Confirm which phase you fall into based on revenue.
- List every entity in your group that issues B2B or B2G invoices.
- Check your VAT registration status and TRN for each entity.
Step 2: Pick an accredited service provider
Only ASPs on the Ministry of Finance's published ASP list can transmit invoices through the Peppol network. Appoint your ASP early, ideally six months before your phase deadline, so testing and onboarding finish on time.
Step 3: Clean up master data
- Validate every customer and supplier TRN.
- Standardise product codes, units, and tax codes.
- Map your accounting fields to PINT AE (the UAE Peppol International Invoice profile).
Step 4: Test before go-live
Use the FTA pilot in Q2 2026 if you qualify. Run end-to-end tests with your ASP for at least four invoice scenarios: standard sale, credit note, zero-rated supply, and reverse charge.
Step 5: Train finance and sales teams
Most data errors start at the point of sale, not in accounting. Brief sales teams on TRN capture, invoice timing, and what counts as a tax invoice under UAE rules.
How Cabinet Decision 106 of 2025 fits into wider FTA penalties
E-invoicing fines are one slice of a larger penalty framework. Late VAT or corporate tax registration, late returns, and underpaid tax each carry their own fines. Read the sibling guides on UAE tax penalties, late registration penalties UAE, and late filing penalties UAE for the full picture.
For e-invoicing specific issues, our note on UAE e invoicing penalties breaks down each violation type with practical fixes.
Official sources
Always work from the primary text when you assess legal risk. The two anchor sources are the UAE Ministry of Finance and the Federal Tax Authority.
- UAE Ministry of Finance publishes Cabinet Decisions and Ministerial Decisions.
- UAE MoF e-invoicing portal hosts the accredited ASP list and technical specifications.
- UAE Federal Tax Authority issues guidance, public clarifications, and audit rules.
Plan ahead before fines start
The FTA has set clear deadlines and clear fines. Phase 1 businesses need an accredited ASP by October 30, 2026 and a working e-invoicing flow by January 1, 2027. Acting now costs far less than paying penalties later. To see the wider compliance map again, visit our FTA Compliance UAE hub.
EInvoice Direct is UAE e-invoicing software built by Massive FZCO in Dubai. An accredited service provider is included with the software at no extra charge, so you cover Cabinet Decision 106 of 2025 readiness in one step. Get UAE e-invoicing pricing and start your rollout plan today.
Questions, answered
What is Cabinet Decision 106 of 2025?
Cabinet Decision 106 of 2025 is the UAE law that sets administrative penalties for electronic invoicing violations. It applies to businesses inside the Peppol 5-corner DCTCE model and works alongside Federal Decree-Law 16 of 2024 and Ministerial Decisions 243 and 244 of 2025. Fines run from AED 2,500 to AED 50,000 per violation, with higher amounts for repeat offences within 24 months.
How much is the fine for not issuing an e-invoice in the UAE?
Under Cabinet Decision 106 of 2025, failing to issue a compliant e-invoice typically sits in the AED 2,500 to AED 10,000 band per violation. The Federal Tax Authority can apply the fine per invoice in some cases. Systemic failures, such as continuing to send paper invoices after your phase go-live date, can push exposure into hundreds of thousands of dirhams across a single audit.
When do Cabinet Decision 106 of 2025 penalties start?
Penalties apply from the date your phase becomes mandatory. Phase 1, covering businesses with AED 50 million or more in revenue, goes live on January 1, 2027. Small and medium businesses follow on July 1, 2027 and government entities on October 1, 2027. The accredited service provider appointment deadline for Phase 1 is October 30, 2026.
What is the maximum penalty under Cabinet Decision 106 of 2025?
The maximum administrative penalty per violation is AED 50,000. This top band applies to the most serious breaches, such as obstructing Federal Tax Authority access to e-invoicing data or failing to keep required records. Repeat violations within 24 months can double the original fine, but each penalty stays capped at AED 50,000 per violation under the published framework.
Do e-invoicing penalties replace VAT penalties?
No. Cabinet Decision 106 of 2025 penalties sit alongside existing VAT and corporate tax fines. A single event, such as a missing tax invoice, can trigger both an e-invoicing fine and a separate VAT penalty. Businesses should treat the regimes as cumulative when they assess audit risk and build their internal controls.
How can a UAE business avoid Cabinet Decision 106 of 2025 fines?
Appoint an accredited service provider before your phase deadline, clean up customer and supplier TRN data, and map your accounting fields to the PINT AE format. Test end-to-end invoice flows during the FTA pilot in Q2 2026 if you qualify. Train sales and finance teams on the new rules so errors are caught at source, not during an audit.
Where can I read the official text of Cabinet Decision 106 of 2025?
The official text is published by the UAE Ministry of Finance on mof.gov.ae. Technical specifications and the list of accredited service providers sit on the MoF e-invoicing portal at einvoicing.mof.gov.ae. The Federal Tax Authority on tax.gov.ae issues related guidance and public clarifications. Always rely on these primary sources before you act on any third-party summary.
Keep reading
The complete UAE tax penalties matrix for VAT, corporate tax, and e-invoicing
UAE tax penalties across VAT, corporate tax, and e-invoicing in one place, with amounts, legal sources, and relief options. See the full matrix below.
Read the guide →UAE VATVAT penalties in the UAE: the complete reference list
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Read the guide →FTA Compliance UAEA plain-English guide to UAE corporate tax penalties
UAE corporate tax penalties explained in plain English, with fines, filing deadlines, and how to avoid them. Read the full breakdown and stay
Read the guide →This content is informational and does not constitute tax, legal, or financial advice. Consult an FTA-registered tax agent or a licensed UAE audit firm before acting on this information.
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