UAE eInvoicing FAQ: Everything Businesses Need to Know

UAE eInvoicing FAQ: Everything Businesses Need to Know

As the UAE transitions into a fully digital tax ecosystem, the eInvoicing framework under the Ministry of Finance (MoF) and Federal Tax Authority (FTA) plays a crucial role. Here are the most frequently asked questions (FAQ) to help businesses understand the new system, stay compliant, and get ready for the change.

1. Which Fields of the eInvoice Are Validated by MoF/FTA Systems?

The UAE eInvoicing framework follows a decentralized 5-corner model, meaning that data validation happens before the invoice ever reaches the FTA.

• Who Validates the Data?

• The Accredited Service Provider (ASP) validates all mandatory data fields as per the UAE eInvoicing Data Dictionary.

• How Does Validation Work?

  1. Exchange – The invoice is validated and transmitted over the Peppol network to the buyer.
  2. Reporting – After a successful exchange, the invoice data is reported to the FTA (Corner 5).

This ensures that every eInvoice is accurate, standardized, and meets compliance requirements before being shared.

2. What Is the Procedure to Deliver the Tax Invoice to the Customer?

Businesses must use a UAE-Accredited Service Provider to issue and receive e-Invoices.

• Delivery Method:
  The buyer’s electronic address (endpoint) is used to send the invoice securely over the Peppol network.
• Compliance Advantage:
  This process guarantees that the invoice is validated and legally recognized by the FTA, minimizing disputes and audit risks.

3. Do VAT Group Members Need Separate Integration With an Accredited Service Provider?

Yes. Each legal entity within a VAT group must have its own endpoint through a UAE-Accredited Service Provider.

• Why Separate Endpoints?

  This ensures that all transactions can be correctly traced, reported, and attributed to the right group member, even though the VAT Group shares a single TRN.

• Reporting Obligation:
  All tax data fields for every member’s invoices are reported to the FTA (Corner 5).

4. Can an Individual Member of a VAT Group Be Selected as Supplier/Seller?

Yes. Even under the same VAT Group TRN, individual members can be selected as suppliers.

• Invoice Details:
  • Use the VAT Group’s TRN on the invoice.
  • The endpoint details must reflect the specific group member issuing the invoice.
  • Include that member’s name and address details in the invoice.

This ensures transparency and proper allocation of revenue across group entities.

5. Who Creates and Exchanges the eInvoice in Case of Self-Billing?

In self-billing arrangements, the buyer (customer) — not the supplier — is responsible for invoicing.

• Creation: The buyer generates the eInvoice with all required data fields.
• Exchange: The buyer shares the eInvoice with the supplier via the Peppol network using their Accredited Service Provider.
• Reporting: The transaction is also reported to the FTA for compliance.

What is Self-Billing?

Self-billing is when the buyer issues the invoice on behalf of the seller. This is common in industries where the buyer has better control over pricing, quantity, or schedules (e.g., supermarkets, long-term procurement contracts).

6. How Will eInvoices Be Exchanged With Overseas Customers?

In the case of exports, the process depends on whether the foreign buyer is part of the Peppol network:

• If the foreign buyer is registered on Peppol:
  The buyer’s electronic address (endpoint) must be provided, and the invoice can be exchanged over the Peppol network.
• If the foreign buyer is not registered on Peppol:
  • A dummy endpoint will be used for reporting purposes.
  • The invoice will not be exchanged via Peppol but will still be reported to the FTA (Corner 5) by the seller’s ASP.
  • The seller must send the invoice to the buyer through alternative means (e.g., email, courier, portal).

Important: Overseas buyers are not required to register with a UAE eInvoicing Service Provider unless specifically obligated under UAE VAT or Corporate Tax law.

7. What Activities Should a Business Prepare for?

Businesses should analyze their transactions and invoicing data against the UAE eInvoicing Data Dictionary to ensure compliance.

Once the list of Accredited Service Providers is published by the MoF, businesses must:

• Select an ASP and finalize a commercial arrangement.
• Integrate their ERP/accounting systems with the ASP to enable invoice transmission.
• Run end-to-end testing to ensure data accuracy and reporting compliance.

8. How UAE Businesses Can Prepare for eInvoicing?

The transition to eInvoicing requires early preparation to avoid compliance risks and operational disruptions. Here’s a step-by-step approach:

1. Conduct a Gap Analysis
   Review your ERP/accounting system, invoice formats, and data fields against the UAE eInvoicing Data Dictionary.
2. Choose a UAE-Accredited Service Provider (ASP)
   Select an ASP that integrates smoothly with your ERP and supports Peppol network exchange and FTA reporting.
3. Implementation & Testing
   Configure your ERP, integrate with the ASP, and test invoices to ensure compliance.
4. Post-Implementation Monitoring
   After going live, regularly monitor validation reports, FTA acknowledgments, and error logs.
5. Seek Expert Support
   CLA Emirates provides end-to-end eInvoicing readiness services:
   • Readiness Assessment & Gap Analysis
   • Implementation Support with your ASP
   • Team Training & User Adoption
   • Post-Implementation Compliance Monitoring

This ensures your business is ready for the FTA’s mandatory rollout and avoids penalties.

9. What Will Be the Identifier of the Business?

The identifier will be the Tax Identification Number (TIN), which is the first 10 digits of the Tax Registration Number (TRN) issued to the business.

• If you do not have a TRN:
  You must register with the FTA to obtain a TIN before you can participate in the eInvoicing framework.

10. What Are the Allowed Modes of Error Correction?

In the case of any errors in tax invoices, a credit note must be issued for rectification. This ensures proper audit trails and compliance with UAE VAT law.

11. How Will Cross-Border Transactions Comply With the PINT Framework?

It is the obligation of the UAE seller to ensure the eInvoice is fully compliant with the UAE PINT framework and reported to the FTA through an Accredited Service Provider.

• Transmission to Buyers:
  If the buyer is in a non-Peppol-compliant country, the seller can send a PDF version of the invoice outside the Peppol network (e.g., via email).
• Compliance Note:
  Even though the exchange is outside the network, reporting to the FTA remains mandatory.

12. How Should Scenarios Be Handled Where an Invoice Is Partially Rejected?

There is no concept of full cancellation of an eInvoice in the UAE system.

• Resolution Method:
  If an invoice is partially rejected by the buyer, the supplier must issue a credit note for the rejected portion.
  This keeps the transaction history accurate and compliant with FTA requirements.

13. How to Handle Domestic Reverse Charge on Electronic Devices When Self-Billing Is Involved?

In such cases:

• The supplier’s invoice and the buyer’s self-billed invoice must both be sent through the UAE eInvoicing network.
• Document identifiers will be used to link both documents to the same transaction for audit and compliance purposes.

For detailed examples, refer to the use cases provided in the Public Consultation Document issued by the MoF/FTA.

Key Takeaways

• Always use a UAE-Accredited Service Provider for eInvoicing.
• Validate all invoice data fields before exchanging and reporting.
• Issue credit notes (not cancellations) to correct errors or partial rejections.
• Ensure each VAT group member has a unique endpoint to remain compliant.
• For self-billing + reverse charge, both invoices must go through the network.
• Partner with experts like CLA Emirates for smooth implementation and ongoing compliance.

Call for Consultation
Mr. Arun Sankaran | Associate Director - Management Accounts
M: +971 54 211 9620
E: arun.sankaran@claemirates.com