📌 Key Amendments to VAT Executive Regulations
The Federal Tax Authority (FTA) issued Public Clarification No. 40, introducing updates under Cabinet Decision No. 100 of 2024. These changes affect how businesses handle exports, financial services, and composite supplies:
• Export Documentation Simplified: Businesses can now use a broader range of documents to prove zero-rated exports, including customs clearance certificates and certified destination country documents A.
• Composite Supply Clarification: Supplies with multiple components must meet stricter criteria to qualify as a single taxable supply. If prices are itemized separately, they may not qualify B.
• Financial Services VAT Scope Expanded: Islamic financial arrangements like Ijarah and Murabaha are now explicitly addressed. Services related to virtual assets (e.g., crypto wallet management) are taxable A B.
📄 E-Invoicing Mandate: Prepare for July 2026
The UAE Ministry of Finance has confirmed that e-Invoicing will be mandatory starting July 2026. SMEs must begin preparing now:
• Simplified Tax Invoices Will Be Discontinued: Businesses under the e-Invoicing scope must issue full-format invoices C.
• Zero-Rated Supplies Still Require Invoices: Even if a supply is wholly zero-rated, an e-Invoice must be issued under the new schema C.
• No More Administrative Exceptions: Reliefs previously granted by the FTA for not issuing invoices or credit notes will no longer apply C.
Action Step: SMEs should assess their billing systems, update customer data, and align with the UAE PEPPOL network to avoid disruptions.
🧠 Why This Matters for SMEs
These updates are more than regulatory tweaks—they directly impact how SMEs operate:
• Avoid Penalties: Non-compliance can lead to fines or delayed payments.
• Improve Cash Flow: Timely, accurate invoicing ensures faster customer payments.
• Enhance Credibility: Professional financial practices build trust with partners and
Need help navigating these changes?
Our team offers VAT consulting, software implementation, and training tailored for UAE SMEs. Let’s ensure your business is ready for the future of tax compliance.