Which transactions are excluded from e-invoicing in the UAE?

Ministerial Decision No. 244 of 2025 excludes business-to-consumer transactions, and persons engaged only in them, until the Minister issues a decision setting a date. A Dubai Mall retailer selling to shoppers is outside the system for those sales.

Mixed businesses need care. A Sharjah IT shop selling laptops to walk-in customers and also supplying 30 companies on account is in scope for the company sales and out of scope, for now, for the walk-in sales.

Article 4 lists excluded transactions. They include business transactions by government entities in a sovereign capacity, international passenger transport and related airline services, certain air cargo transport for a limited period, and financial services that are exempt or zero-rated for VAT. The Minister can add further exclusions.

The airline and transport exclusions are narrow and defined by document type, so read the decision itself. Firms summarising it describe the air cargo exclusion as covering international transport with airway bills for 24 months.

• Government entities acting in a sovereign capacity
• International passenger transport and ancillary airline services
• Certain international air cargo, for a limited period
• Exempt or zero-rated financial services
• B2C transactions, until a date is set

Ministerial Decision No. 197 of 2026, in force from 1 October 2026, adds a temporary exclusion for business transactions between persons that are members of the same Tax Group. It runs for 24 months from 1 January 2027, and these transactions are treated as excluded transactions for that period.

Check with your tax agent which kind of group this refers to before relying on it. A VAT group and a corporate tax group are formed under different laws and with different membership.

An excluded transaction still needs whatever invoice the VAT law requires. A VAT-registered retailer selling to a consumer still issues a tax invoice or simplified tax invoice as today; it simply does not go through the e-invoicing system.

Exclusion also does not affect corporate tax or VAT liability. It only decides whether the transaction is issued and reported as an e-invoice.

Example: a Dubai travel management company has three revenue streams. Corporate travel management fees billed to companies: in scope. Airline tickets sold to individuals: B2C and also within the airline exclusion. Foreign exchange commission on traveller cards: possibly an exempt financial service, to be checked. Its e-invoicing project covers the first stream fully and documents why the others are excluded.

Write down the classification for each revenue stream and keep it with your e-invoicing project file. If the FTA asks why a transaction was not e-invoiced, you want the reasoning on paper, not in someone's memory.

Exclusions depend on who the customer is, and customers change. A sole trader buying from you as an individual may register a business; a company may be acquired by a government entity. Review customer categories at least once a year, and whenever you update a customer's licence or TRN.

Keep the date of each change. If a customer becomes a business on 1 March, sales before that date were B2C and outside the system, while sales after it are in scope. A clean change history makes that simple to show.

HelloBooks can separate revenue streams by account or class and mark customers as businesses or consumers, so the in-scope population is easy to see. Ask the AI agent 'how many invoices last quarter went to business customers?' to size your e-invoicing volume.

HelloBooks does not issue e-invoices or decide legal scope; your tax adviser confirms the classification and your accredited provider handles in-scope invoices. If you want custom classes or a scope flag on customer records, the team can set it up via hello@hellobooks.ai.