The Inland Revenue Board of Malaysia (LHDN) has recently announced significant updates regarding the implementation of the e-Invoice system, which will be mandatory for businesses in Malaysia. Starting from August 1, 2024, businesses with an annual turnover exceeding RM100 million must begin using the e-Invoice system. The implementation will be phased, with additional thresholds taking effect on January 1, 2025, for businesses with turnover between RM25 million and RM100 million, and a full rollout for all remaining taxpayers by July 1, 2025.
This e-Invoice system is part of LHDN’s efforts to enhance tax compliance, reduce fraud, and improve the overall efficiency of tax administration. The system will require detailed information on invoices, including supplier and customer details, item descriptions, and validation information. Businesses will need to ensure their invoicing processes are compliant with these new requirements to avoid any penalties.
Additionally, businesses engaged in international trade may consider integrating the PEPPOL framework alongside LHDN’s MyInvois system to facilitate seamless e-invoicing across borders, especially for business-to-business transactions.
These changes underscore the importance of businesses preparing early for the transition to e-Invoicing to ensure compliance and avoid disruptions.
