The Ministry of Finance has released updated VAT Executive Regulations amending Articles 59 (Tax Invoice) and Article 60 (Tax Credit Note) through Cabinet Decision No. 100 of 2025. These amendments aim to align certain VAT compliances with the upcoming E-invoicing framework. The changes are effective from 29 September 2025.
The new Articles clarifies that once a business is either mandated to issue E-invoices or E-credit notes, or voluntarily opts into E-invoicing compliance, the following flexibilities under the VAT law will no longer be applicable:
- Issuance of simplified invoices
- Zero-rated supplies must be supported by compliant tax invoices (earlier the businesses were not required to issue tax invoice if there were sufficient records were available to establish the particulars of a zero-rated supply)
- Full tax invoices would be required to be issued even for small-value supplies (less than AED 10,000) and for non-VAT registered buyers (earlier simplified invoices were allowed to be issued in such cases)
- Discretion of FTA to approve specified cases where tax invoices or tax credit note are not required to be issued or certain contents are not required to be mentioned on the tax invoices
Accordingly, all prescribed particulars must be included in both tax invoices and tax credit notes under the E-invoicing regime.
Considering these changes, it is imperative for the businesses to evaluate how e-invoicing will affect their VAT compliance, invoicing processes and ERP systems.