Implementation of e-Invoice in Malaysia: Frequently Asked Questions (FAQs)

This comprehensive FAQ covers various aspects of e-Invoice implementation in Malaysia, updated April 6, 2024

PART 1: GENERAL FAQS

1. Is e-Invoice applicable to transactions in Malaysia only? The issuance of e-Invoice extends beyond domestic transactions and encompasses cross-border dealings as well.

2. Will there be any engagement sessions with IRBM? Yes, IRBM is actively organizing engagement sessions with industry stakeholders to provide comprehensive information on e-Invoice implementation.

3. Who should we reach out to for queries or concerns? Queries regarding e-Invoice implementation can be directed to myinvois@hasil.gov.my, while SDK-related queries can be sent to sdkmyinvois@hasil.gov.my.

4. What is the transmission mechanism for e-Invoices? E-Invoices can be transmitted through the MyInvois Portal provided by IRBM or via Application Programming Interface (API).

5. What are the thresholds for e-Invoice implementation? E-Invoice implementation is phased based on annual turnover thresholds, as outlined in the e-Invoice Guideline.

6. Are all industries included in the e-Invoice implementation? Currently, all industries are part of the e-Invoice implementation, with exemptions outlined in the e-Invoice Guideline.

7. Will all businesses be required to issue e-Invoice? Yes, all businesses will be required to issue e-Invoices based on the phased implementation timeline.

8. Is there any adjustment window allowed for e-Invoice cancellation? Yes, there is a 72-hour timeframe for suppliers to cancel e-Invoices.

9. Will IRBM provide technical guidance on system integration? Yes, IRBM has published an e-Invoice Software Development Kit (SDK) to aid in system integration.

10. How can taxpayers prepare for e-Invoice implementation? Taxpayers should focus on human resources, review business processes, and ensure technology readiness.

11. What are the consequences for failure to issue e-Invoice? Failure to issue e-Invoice may result in penalties or imprisonment, as per Section 120(1)(d) of the Income Tax Act 1967.

12. Are there any incentives for e-Invoice implementation? Tax incentives such as deductions are available for environmental and governance-related expenditures incurred during e-Invoice implementation.

PART 2: SCOPE AND PROCESS FAQS

13. How do taxpayers issue e-Invoices for foreign transactions? Suppliers must obtain buyer details for foreign transactions, and specific guidelines are provided for TIN input.

14. Should taxpayers input old and new business registration numbers? Taxpayers must input the new business registration number for e-Invoice issuance.

15. Which TIN should individual taxpayers use for e-Invoice? Individual taxpayers should provide their TIN with the prefix "IG" for e-Invoice purposes.

16. How long does e-Invoice validation take? E-Invoice validation by IRBM occurs in near real-time.

17. Is there a specific timeframe for e-Invoice issuance? There is no specific requirement for the timing of e-Invoice issuance, except in certain cases.

18. What is the timeframe for e-Invoice adjustments? There is no specific timeframe for e-Invoice adjustments, and taxpayers may follow company policies.

19. Which types of income require e-Invoice issuance? E-Invoice is required for all types of income and expenses, subject to exemptions.

20. Can suppliers provide normal invoices during the transitional period? During transition, suppliers can provide either normal invoices or validated e-Invoices for tax purposes.

21. Do buyers need to issue self-billed e-Invoices for poor connectivity? Self-billed e-Invoices are allowed for specific transactions, and alternative options are available for connectivity issues.

22. Can e-Invoices be stored in draft form on the MyInvois Portal? Yes, suppliers can create e-Invoices in draft form on the portal.

23. Can information be edited after e-Invoice validation? No, information cannot be edited post-validation, and a new e-Invoice may need to be issued.

24. What does IRBM validate in e-Invoices? IRBM validates e-Invoices for compliance with format and data structure requirements.

25. Will the supplier’s invoice number remain in the e-Invoice document? The supplier’s invoice number remains separate, with IRBM assigning a Unique Identifier Number to each e-Invoice.

26. How are deposits treated in e-Invoices? Refundable deposits do not require e-Invoice issuance, while non-refundable deposits do.

27. What is the treatment of director fees in e-Invoices? Director fees are subject to specific guidelines outlined in the e-Invoice Guideline.

28. Are e-Invoices required for disbursements and reimbursements? E-Invoices may be required, subject to specific situations as detailed in the e-Invoice Specific Guideline.

29. Is an e-Invoice required for returns to buyers? Yes, a refund note e-Invoice is required for returns to buyers, except in specific cases.

30. Can Malaysian buyers consolidate invoices for self-billed e-Invoices? No, separate self-billed e-Invoices must be issued for each transaction unless specified otherwise.

31. When should Malaysian buyers issue self-billed e-Invoices for imports? Self-billed e-Invoices for imports should be issued by the end of the month following RMCD clearance.

32. When should Malaysian buyers issue self-billed e-Invoices for services? Self-billed e-Invoices for services should be issued based on payment or receipt of invoices from foreign suppliers.

33. Are e-Invoices required for intercompany charges? Yes, e-Invoices are required for intercompany charges.

34. Are e-Invoices required for inter-department transactions? No, e-Invoices are generally not required for inter-department transactions within the same company.

35. Must individual landlords issue e-Invoices for rental income? E-Invoices are required if the individual landlord conducts business; otherwise, self-billed e-Invoices may be necessary.

36. Do taxpayers need to provide e-Invoices to RMCD for customs clearance? Existing RMCD processes for customs clearance remain applicable post e-Invoice implementation.

37. Does e-Invoice comply with RMCD documents for customs clearance? Yes, e-Invoice complies with RMCD requirements, and any changes will be communicated by RMCD.

38. How should low-value goods under e-PAM be handled in e-Invoices? Taxpayers must include the e-PAM reference number in the e-Invoice for low-value goods.

39. What value should taxpayers use for self-billed e-Invoices on goods? Actual transaction value as per the foreign supplier’s invoice should be used in self-billed e-Invoices for goods.

40. Is registration required for technology providers in e-Invoice implementation? There is no registration requirement currently, but providers must ensure compliance with IRBM's API.

PART 3: SYSTEMS, DATA, SECURITY, AND PRIVACY FAQS

41. Does the Personal Data Protection Act apply to e-Invoice processing? The Act does not apply to personal data processed for e-Invoice issuance or transmission to IRBM.

42. Does the API solution offer security and encryption services? Yes, the API solution ensures data security and privacy through encryption and industry-standard protocols.

43. How does IRBM monitor e-Invoice data security? IRBM follows stringent data security measures, including controls, monitoring, and auditing.

44. Is a specific application needed to scan QR codes on e-Invoices? Any device capable of scanning QR codes can be used to access validated e-Invoice links.

45. How does IRBM protect e-Invoice confidentiality? IRBM employs industry-standard cybersecurity measures, encryption, and compliance with data protection policies.

46. What file format is sent to IRBM for e-Invoice validation? Suppliers must submit e-Invoices in XML or JSON file format for validation.

47. Can companies use multiple transmission mechanisms for e-Invoices? Yes, companies can use a combination of API and MyInvois Portal, ensuring reconciliation to avoid duplication.

48. What happens if the MyInvois System is down? A 72-hour window is provided for e-Invoice issuance once the system is available again.

49. Can taxpayers adopt Peppol for e-Invoice transmission? Taxpayers can choose any transmission method compliant with IRBM's API requirements.

50. Can MyInvois Portal handle large volumes of e-Invoices? Yes, the portal supports individual and batch e-Invoice generation for multiple transactions.

51. What measures ensure MyInvois Portal uptime and reliability? The system is designed for high availability, with 99.97% uptime, and a retry mechanism for failed submissions.

SOURCE: 

• Frequently Asked Questions | Lembaga Hasil Dalam Negeri Malaysia