Implementation of E-Invoice in Malaysia

Lembaga Hasil Dalam Negeri (LHDN) has announced the introduction of e-Invoice implementation for all entities engaged in commercial activities in Malaysia, encompassing B2G (Business-to-Government), B2B (Business-to-Business), and B2C (Business-to-Consumer) operations. This directive applies to various entities, including associations, bodies of persons, branches, business trusts, co-operative societies, corporations, limited liability partnerships, partnerships, property trust funds, property trusts, real estate investment trusts, representative offices, regional offices, trust bodies, and unit trusts.

Implementation Timeline:

• Companies with an annual revenue exceeding RM100 million: Effective 1 August 2024
• Companies with an annual revenue between RM25 million and RM100 million: Effective 1 January 2025
• All other taxpayers: Effective 1 July 2025

The annual revenue benchmarks for e-Invoice implementation are determined as follows:

• Taxpayers with audited financial statements (audit report): Based on the annual revenue stated in the statement of comprehensive income in the audited financial statements for the financial year 2022.
• Taxpayers without audited financial statements: Based on the annual revenue reported in the tax return (e.g., Form B, Form PT, etc.) for the year of assessment 2022.
• In case of a change in the financial year-end for the financial year 2022: The annual revenue will be prorated to a 12-month period for determining the e-Invoice implementation date.
• For new businesses/operations commencing from the year 2023 onwards: Implementation date is 1 July 2025.

Important Note:

Once the e-Invoice implementation timeline is determined, subsequent changes to the taxpayer's annual revenue will not alter the obligation to implement e-Invoice based on the set timeline.

Invoices issued prior to the e-Invoice implementation date are not required to be converted, and during the transition period, taxpayers can provide either a standard bill/receipt/invoice (as per current practice) or a validated e-Invoice to substantiate a transaction until full implementation is in place.

Please do not hesitate to contact us for more information:

Ten Jia Sheng
014-911 1880
jsten@jsc-corp.com