A Guide to VAT Invoicing in the UAE

Learn how to create VAT-compliant invoices in the UAE. Understand required information, formatting, and best practices to stay compliant with FTA regulations.

What is a VAT Invoice?

A VAT invoice is an official document issued by a VAT-registered business when selling goods or services. It records the taxable supply and the VAT charged, ensuring compliance with UAE VAT law. Proper VAT invoicing is essential for both legal compliance and accurate accounting.

Who Must Issue a VAT Invoice?

• All VAT-registered businesses in the UAE

• Applies to both B2B and B2C transactions

• Required for taxable supplies, including goods, services, and imports

Note: Non-taxable supplies or exports may require simplified invoices or specific exemptions.

Understanding Mandatory VAT Invoice Requirements

A compliant VAT invoice must include the following:

1. Supplier information: Name, address, and Tax Registration Number (TRN)

2. Customer information: Name, address, and TRN (for B2B)

3. Invoice number and date

4. Description of goods or services supplied

5. Quantity and unit price of each item

6. VAT rate applied (usually 5%)

7. Total amount excluding VAT

8. Total VAT amount

9. Total amount including VAT

Tip: Use sequential invoice numbering to simplify record-keeping.

Issuing VAT Invoices Promptly

1. Go to the FTA e-Services portal.

2. Click “Register for VAT”.

3. Enter your business details:

   • Legal entity type

   • Trade license number

   • Business activity

4. Provide financial estimates for taxable supplies.

5. Upload the required documents and submit your application.

Note: Start-ups should ensure the accuracy of estimated financial figures, as the FTA may request clarification.

Using Digital Invoicing Tools

• Digital accounting software can automatically generate VAT-compliant invoices.

• Benefits include:

  • Reduced errors

  • Automatic VAT calculations

  • Simplified filing and record-keeping

• Popular options in the UAE include software integrated with the FTA e-Services portal.

Keeping Accurate Records

• Maintain a copy of every VAT invoice issued.
• Store invoices electronically or physically for at least 5 years, as required by the FTA.
• Organise invoices by period, customer, or invoice number for easier VAT reporting and audits.

Handling Special Cases

• Exports: VAT may be zero-rated, but a compliant invoice must still be issued.

• Credit notes and debit notes: Required for adjustments to previously issued invoices.

• Simplified invoices: For retail sales under AED 10,000, a simplified invoice may be acceptable.

FAQs About VAT Invoicing in the UAE

Q1: Can I issue invoices electronically?
Yes, electronic invoices are fully accepted, provided they comply with FTA record-keeping requirements.

Q2: Do all invoices need customer TRNs?
No, TRNs are required for B2B transactions. For B2C, customer TRNs are not mandatory.

Q3: How long should VAT invoices be stored?
Invoices must be kept for 5 years from the end of the tax period to which they relate.

Q4: Can I correct errors on a VAT invoice?
Yes, use a credit note or debit note to adjust incorrect invoices.