FAQ – eInvoice Guidelines
1. Is e-Invoicing applicable to transactions in Malaysia only?
No, e-Invoicing is applicable to both domestic and cross-border transactions. Cross-border transactions (imports) are also required to be validated with IRB through a self-billing process.
2. What are the revenue thresholds for e-Invoicing implementation to be applicable to taxpayers?
The annual turnover or revenue for the implementation of e-Invoice will be determined based on the following:
- Taxpayers with audited financial statements: Based on annual turnover or revenue stated in the statement of comprehensive income in the audited financial statements for financial year 2022.
- Taxpayers without audited financial statements: Based on annual revenue reported in the tax return for year of assessment 2022.
- In the event of a change of accounting year end for financial year 2022, the taxpayer’s turnover or revenue will be pro-rated to a 12-month period for purposes of determining the e-Invoice implementation date.
3. Are all industries included in the e-Invoicing implementation? Are there any industries exempted?
Currently, there are no industries that are exempted from the e-Invoice implementation
4. Will all businesses be required to implement e-Invoicing?
Yes, all businesses will be required to issue e-Invoice in accordance to the phased mandatory implementation timeline, which is based on the business’ annual turnover or revenue threshold
5. What does IRBM validate in the e-Invoice?
IRBM validation includes a series of field checks to ensure the e-Invoice submitted to IRBM conforms to the e-Invoice format and data structure as specified by IRBM. The latest required field checks are 51 and is subject to revision
6. Is MYInvois portal able to accept large volume of e-Invoices from taxpayers?
MyInvois Portal supports both individual and batch e-Invoice generation through spreadsheet upload for processing multiple transactions
7. What are the consequences for non-compliance?
New provisions in the Income Tax Act (Section 82c) mandates that an electronic invoice must be issued for each transaction in the year of assessment. Failure to issue an invoice, a self-billed invoice or consolidated transaction invoice will attract fine of not less than RM200.00 and not more than RM20,000.00 or imprisonment not exceeding 6 months or both.
FAQ – Sellers/Buyers
1. How much does it cost to implement e-invoicing?
The implementation of IRBM e-invoicing will not be an “one size fits all” solution. Such implementation and associated costs will depend on several factors including but not limited to the nature of business, integration model so adopted, existing ERP or accounting system types, scope of work, operational coverage and system enhancements or upgrades as well as the need to have critical functional operating processes to ensure adherence and compliance
2. Is it only about IT enhancement?
No. e-Invoicing is not just a technology matter but a tax obligation that should be well managed and implemented from inception to implementation. It involves collaboration efforts from all departments encompassing IT, People, Finance, Admin, Legal and HR. Sales, Marketing & Operations including Procurement will also be impacted.
3. What are the mechanisms to transmit e-Invoices to IRB and available options?
Per IRB’s latest guidelines, there 2 mechanisms are:
- MyInvois Portal (a free solution portal hosted by IRB)
- Application Programming Interface (API)
4. How will e-Invoice impact preparation of financial statements?
Given that e-Invoice will be the source document for proof of income and expense, preparation of financial statements such as Balance Sheet, Profit & Loss, Cashflow statements etc will need to be substantiated with validated e-Invoice going forward; failing which such income or expense item will need to be excluded from financial statements
5. Would IRBM’s requirement for e-Invoicing have any implication on payments between a buyer and a seller?
No, e-invoicing should not affect payments between a supplier and buyer during the transitional period. During this period, taxpayers may provide either a regular bill, receipt, or invoice (if the supplier has not yet adopted e-Invoice) or a validated e-Invoice to support transactions for tax purposes until the full rollout. Thus, there will be no changes to billing process. You will continue receiving and paying bills as usual until e-Invoice is fully implemented
6. What documents are covered under e-Invoices?
Invoices, credit notes, debit notes and refund notes including expense billing items all fall under the scope of Malaysia e-Invoice
7. Can the seller cancel the invoice submitted to IRBM?
Yes, the seller can cancel the e-Invoice within 72 hours from time of generation
8. Is e-Invoice required for disbursements and reimbursements?
Yes, e-Invoices are required for disbursements and reimbursements for certain situations. Please refer to Section 5 of the e-Invoice Specific Guidelines for details
9. Does the invoice number change once it is validated with IRBM?
No, it remains unchanged. However, once validated with IRBM, a Unique Identifier Number will be assigned to that invoice
10. What is the e-Invoice QR code?
The QR code provides you with a link to the validated e-Invoice and it enables you to access the validated e-Invoice via the MyInvois portal
11. Is an e-Invoice required for refunds to buyers?
Yes, a refund note e-Invoice is required for refunds to buyers, except for the following:
- Incorrect payments by buyers
- Overpayments by buyers and
Return of security deposits
12. Can taxpayers issue a single credit note e-Invoice to adjust multiple original e-Invoices?
Yes, taxpayers can amend multiple e-Invoices with a single credit note, debit note, or refund note e-Invoice. The IRBM Unique Identifier Number for each original e-Invoice must be included in the ‘Original e-Invoice Reference Number’ field
13. Who is responsible for issuing e-Invoices?
The supplier of the transaction is responsible for issuing an e-Invoice. However, in certain cases, the buyer self generates the e-Invoice also known as “Self-billed e-Invoice”. Self-billed e-Invoice is required for various transactions, including payments to agents, foreign suppliers’ sales, profit distribution, e-commerce, betting and gaming payouts, and acquisitions from individual taxpayers, as outlined in specific guidelines
14. Can I issue self-billed e-Invoice if my supplier did not issue e-Invoice to me?
Per the Specific Guidelines, Self-billed e-Invoice can only be issued under certain situation. Tax payers are not permitted to issue self-billed e-Invoice if the transaction is not defined in the Specific Guidelines
15. If I sell goods through an e-commerce platform, am I obligated to provide transaction details for e-Invoice issuance?
Yes, and it is the responsibility of the e-commerce platform provider to provide the transaction details via issuance of self-billed e-Invoices. The seller may request a copy of the self-bill e-Invoice from the platform provider as proof of income.
16. If Seller sells goods or provide services on an offline and an online channel such as through an e-commerce platform, must it issue e-Invoices for both?
Seller must issue e-Invoices for offline transactions. For online e-commerce transactions, the platform provider is responsible for issuing e-Invoices
17. If I purchase goods from a bonded warehouse or Free Zone, do I need to include the customs form reference number in the self-billed e-Invoice?
Yes, include the customs form reference number when issuing a self-billed e-Invoice for goods delivered from a bonded warehouse or Free Zone
18. What are the e-Invoice requirements if I am located in a bonded warehouse and sell goods to another Malaysian buyer?
- Issue a self-billed e-Invoice for goods purchased from the foreign supplier
- Issue e-Invoices to subsequent Malaysian buyers for goods sold
19. If I instruct a foreign supplier to deliver goods directly to other Malaysian buyers, how should the e-Invoice and self-billed e-Invoice be issued?
Issue a self-billed e-Invoice for goods purchased from the foreign supplier
Issue e-Invoices to subsequent Malaysian buyers for goods sold
20. If goods are directly drop-shipped from a foreign supplier to a Malaysian buyer, how should e-Invoices be handled?
- Issue a self-billed e-Invoice for goods purchased from the foreign supplier (customs form reference optional)
- Issue an e-Invoice for goods sold to the Malaysian buyer (customs form reference optional)
21. How does a Malaysian supplier issue an e-Invoice for goods exported to foreign buyers?
The supplier of the transaction is responsible for issuing an e-Invoice. However, in certain cases, the buyer self generates the e-Invoice also known as “Self-billed e-Invoice”. Self-billed e-Invoice is required for various transactions, including payments to agents, foreign suppliers’ sales, profit distribution, e-commerce, betting and gaming payouts, and acquisitions from individual taxpayers, as outlined in specific guidelines
22. How do taxpayers issue an e-Invoice to a non-TIN holder such as foreign (non-Malaysian) buyers?
Suppliers are required to obtain recipient details from the recipient. For TIN field to be input in the e-Invoice, supplier may use the general TIN “EI00000000020” for foreign buyers
23. Who will be issuing e-Invoices to Buyers for transactions conducted on an e-Commerce platform?
The e-Commerce platform provider will facilitate the issuance of e-Invoice to the Buyer on behalf of the Seller for transactions conducted on the platform
24. Does the e-Commerce platform provider have the obligation to share to Sellers the e-Invoice/ validated e-Invoice / visual presentation of e-Invoice issued to Buyers?
No, only the visual presentation of the Buyer’s e-Invoice will be shared
25. When can Buyers request an e-Invoice?
Upon request, Buyer may request for an e-Invoice upon completion of a sale. The e-Invoice will be sent to the Buyer after validation
26. Who needs an e-Invoice?
E-Invoices are essential for businesses and organisations that need to process claims, manage expenses and for audit & tax filing purposes
27. Is e-Invoice applicable only to domestic transactions?
No, e-Invoice applies to both domestic and cross-border transactions – import and export activities
28. Can suppliers issue backdated e-Invoices?
No, the e-Invoice should be validated on a real-time basis
29. If I sell goods or services on an online platform, am I required to issue e-Invoice to the buyer?
No, the online platform provider will issue e-Invoice to the buyer and self-bill for goods or services sold on its platform. The seller may request a copy of the self-bill e-Invoice from the platform provider as proof of expense
30. What constitutes a validated e-Invoice?
A validated e-Invoice will include IRB’s Unique Identifier Number along with the date and time of validation and a validation link to MYInvois portal. In addition, the e-Invoice will be embedded with a QR code which the recipient can scan to verify the existence and authenticity of the e-Invoice
