UAE eases e-invoicing rules: tax group transactions excluded for two years, local storage rule dropped

The UAE Ministry of Finance has issued Ministerial Decision No. 197 of 2026, amending parts of Ministerial Decision No. 243 of 2025 on the Electronic Invoicing System, the ministry announced on 19 October. The decision took effect on 1 October 2026.

Business transactions between members of the same VAT tax group will be treated as excluded transactions for 24 months starting on 1 January 2027, giving groups more time to adapt their systems. The decision adds definitions of "Tax Group" and "Taxable Person" by reference to the VAT Law.

The rule on storing e-invoice data has also changed. Businesses must keep all electronic invoices, electronic credit notes and related data for the period set by the Tax Procedures Law and be able to produce them to the Federal Tax Authority on request, but the earlier requirement to store the data inside the UAE has been removed.

The decision also repeals the "System Failure" provisions, including the duty to notify the Federal Tax Authority within two business days of a system failure. Other exclusions remain, such as certain airline passenger and cargo services and VAT-exempt or zero-rated financial services, and electronic invoices must still be issued and transmitted within 14 business days of the transaction.

Companies preparing for e-invoicing should check whether they belong to a VAT tax group and review where their invoice data is hosted. The full decision is published on the Ministry of Finance e-invoicing page.