Read me First - 20 FAQs on E-Invoicing Implementation in 2025

 Here are 20 common questions business owners in Phase 3 and Phase 4 would ask regarding e-Invoicing implementation, along with detailed and straightforward answers, based on guidelines issued by Inland Revenue Board of Malaysia (IRBM):

General Information & Implementation Timeline:

1. What is e-Invoicing? 
 An electronic invoice (e-Invoice) is a digitally structured invoice generated, transmitted, received, and processed electronically via IRBM's MyInvois platform. It replaces traditional paper-based invoices. 

2. Who falls under Phase 3 and Phase 4 implementation?
    • Phase 3: Taxpayers with annual turnover over RM500,000 up to RM25 million (implementation date: 1 July 2025).
    • Phase 4: Taxpayers up to RM500,000 turnover (implementation date: 1 January 2026).
Refer to IRBM e-Invoice Guideline for more details. 

3. Why does Malaysia implement e-Invoices? 
 To streamline business administration, reduce compliance costs, minimize human errors, ensure tax compliance, and boost transparency in financial transactions. 

4. Is the e-Invoice mandatory for all businesses? 
 Yes, by 1 January 2026, all taxpayers (except certain exempted entities defined by IRBM) must use e-Invoicing according to their respective thresholds and phased timelines. 

5. How early should SMEs prepare for implementation? 
 SMEs are encouraged to begin preparations at least six months before their mandatory implementation date, allowing adequate time to ensure smooth transition.

System and Technical Requirements:

6. How do we submit the e-Invoice to IRBM? You may issue e-Invoices using IRBM’s provided platforms like MyInvois Portal or via an integrated API connection between your accounting system and IRBM’s MyInvois system. 

7. Is special software required to implement e-Invoicing? 
 You can use IRBM's free MyInvois Portal or Mobile App. However, businesses with high invoice volumes typically integrate their own existing accounting software with the IRBM API for better efficiency.

8. Will IRBM provide assistance if our business lacks digital capabilities? Yes, IRBM offers comprehensive support, including free software and tools such as the MyInvois Portal and Mobile App, and helpful resources and guidelines.

Operational & Compliance Questions:

9. What information must be included in an e-Invoice? Mandatory details include supplier/buyer identification (names, TIN numbers), invoice date, unique invoice number, details of goods/services, amount payable, and applicable taxes. Specific requirements are detailed in the e-Invoice Specific Guideline Version 4.1 .

10. Can businesses still issue paper invoices alongside the electronic version? During the initial transition phase (six-month relaxation period), you may concurrently issue paper and electronic versions. Afterward, e-Invoice issuance is mandatory and fully replaces paper invoices legally. 

11. Can corrections be made to an already issued e-Invoice? 
 Yes. Corrections can be done via issuance of appropriate electronic documents (e.g., electronically issued Credit Notes, Debit Notes or Refund Notes). 

12. Are sales through online platforms also subject to e-Invoice rules? 
 For sales via e-commerce platforms, the platforms themselves typically issue self-billed e-Invoices to IRBM on behalf of sellers. Hence, the obligation shifts to the platform providers.

Exemptions & Special Circumstances:

13. Are there any exemptions from e-invoice requirements? Entities such as individuals not engaged in business, foreign diplomatic missions, statutory bodies, and organisations earning revenue below RM150,000 annually are exempt from issuing e-Invoices. 

14. What if my business turnover bumps above or below the designated thresholds after implementation? Once mandatory implementation starts, you remain subject to e-Invoicing requirements regardless of future changes in your revenue thresholds. 

15. Do foreign transactions require e-Invoicing as well? Yes, all transactions are covered, including exports and imports. Import transactions typically require businesses to issue self-billed e-Invoices.

Cost and Implementation Concerns:

16. Does implementing e-Invoices significantly increase business costs? Initially, some resource allocation might be necessary. Nevertheless, IRBM’s free-of-charge tools (MyInvois Portal and Mobile App) and phased implementation are designed specifically to minimise costs for SMEs. 

17. What happens if we fail to comply with mandatory e-Invoice rules? 

 Non-compliance may lead to penalties under Malaysia’s Income Tax Act 1967. Ensuring early preparedness and compliance reduces this risk substantially.

Data Security and Privacy:

18. How are my business data privacy and security protected in MyInvois system? 
 IRBM ensures robust cybersecurity measures and industry-standard data encryption. Scheduled audits and stringent privacy controls secure sensitive business data. 

19. Who within my company should manage the e-Invoice process? 
 You should designate dedicated personnel (accounting staff, IT, or compliance officers) to manage the implementation, training, and continued compliance regarding e-Invoice issuance and submission.

Miscellaneous:

20. Where can I find further information and training resources regarding e-Invoice implementation? 
 Complete and updated resources, FAQs, training sessions, technical guidelines, and industry-specific documents are consistently available at IRBM’s dedicated e-Invoice microsite .
In a way, the implementation of e-Invoicing is a form of Digital Transformation for SMEs in Malaysia.

Therefore, it is a 'software' or 'application' driven exercise, start with having the software in hand, there are many brand available in the market:
  1. SQL Accounting;
  2. Autocount Accounting
  3. QNE Cloud AI
  4. ABSS Connect
  5. Bukku
  6. Quickbooks Online
  7. Xero 
  8. and many others...
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