The United Arab Emirates (UAE) is moving towards a fully digital tax system with the introduction of e-invoicing under the “E-Billing System.” By July 2026, e-invoicing will be compulsory for Business-to-Business (B2B) and Business-to-Government (B2G) transactions. This initiative aims to make invoicing easier, reduce paper usage, and ensure businesses follow global tax regulations. The UAE’s e-invoicing system is based on the Peppol 5-corner model, providing a standard and efficient process for businesses.
Peppol-Based E-Invoicing Model
On 14th February 2024, at the Dubai E-Invoicing Exchange Summit, the UAE Ministry of Finance announced the adoption of the Peppol-based DCTCE (5-corner) model. This model is part of the new Continuous Transaction Control (CTC) e-invoicing system.
E-Invoicing in the UAE
E-invoicing in the UAE means creating, sending, and storing invoices in a digital format. A valid e-invoice must be in XML or JSON format, follow structured data formats like Universal Business Language (UBL) or Peppol Invoice Standard (PINT), and be transmitted through an Accredited Service Provider (ASP) using the Peppol Network. The invoice must also be submitted in real time to the Federal Tax Authority (FTA) e-Billing system and stored securely. Manually created invoices or those in PDF, JPG, or paper format are not valid.
Revised Implementation Timeline
The original launch date was set for July 2025 but was postponed due to technical challenges. The updated schedule includes the accreditation process for UAE service providers starting in Q4 2024, legislative updates in Q2 2025, and the first phase of e-invoicing reporting going live in Q2 2026.
The Peppol 5-Corner Model for E-Invoicing
The UAE’s CTC e-invoicing system follows the Peppol “5-corner” model. It includes an issuer who creates the invoice, a receiver who receives it, the E-Billing System (FTA) as a repository, a sender ASP who verifies and sends the invoice, and a receiver ASP who verifies and forwards it to the recipient.
Mandatory Compliance for VAT-Registered Businesses
E-invoicing is expected to become mandatory for all VAT-registered businesses in phases. It will cover both B2B and B2G transactions. The Federal Tax Authority (FTA), under the Ministry of Finance (MoF), will establish regulations, approve service providers, and monitor compliance. To comply, businesses must use digital invoice formats such as XML or JSON and follow structured data formats like UBL or PINT.
Legal Framework for E-Invoicing
The UAE’s legal framework for e-invoicing includes VAT Law, introduced in 2018, which allows electronic invoices as valid records. Federal Law No. 1 of 2006 on Electronic Commerce and Transactions recognises electronic records, documents, and signatures. The e-Procurement System automates government procurement and enables digital transactions.
Preparing for E-Invoicing Implementation
Businesses must take several steps to prepare for e-invoicing. They should understand the regulations, check and upgrade their invoicing systems, work with an accredited service provider, integrate their systems for smooth data transmission, and test their systems before full implementation.
SUNFACET ERP, developed by Suntech Business Solutions, provides an all-in-one solution to help businesses meet UAE’s e-invoicing rules. It generates e-invoices in the correct formats, integrates smoothly with the Peppol Network, automates VAT calculations and reporting, improves security and data storage, and enhances financial management.
E-Invoicing Benefits for Jewellery Manufacturers
For jewellery manufacturers, SUNFACET ERP offers industry-specific features. It ensures accurate transaction tracking, simplifies supply chain management, makes VAT compliance easier, and improves business efficiency. Manufacturers can maintain clear records of gold, diamond, and gemstone production and sales while reducing manual invoicing errors.
E-invoicing will be mandatory in the UAE by July 2026. So, Jewellery businesses must upgrade their invoicing systems to stay compliant. SUNFACET ERP from Suntech Business Solutions provides a smooth solution for jewellery manufacturers. By using SUNFACET ERP, they can simplify tax compliance, boost efficiency, and stay updated with regulations. Contact us today to learn how SUNFACET ERP can help your business transition to digital invoicing.
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