Latest update on e-invoice specific guideline, effective 28th June 2024

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The Malaysian Inland Revenue Board (LHDN) has recently released important updates to the e-Invoice specific guidelines. These changes are aimed at improving the accuracy and efficiency of electronic invoicing, ensuring businesses comply with the latest standards.

To know about the LHDN einvoice update on the general guideline. Kindly click here to view the summary of the updates.

Here is the link to get the full guideline for version 2.2: LHDN e-Invoice Specific Guideline Version 2.2. Below, we have summarized the updates.

NoParagraph in e-invoice specific guidelineBefore (Version 2.1)After (Version 2.2)
1.1.31.3 IRBM acknowledged the need to provide further guidance on specific areas of e-Invoice, to aid taxpayers in gaining a better understanding of certain e-Invoice treatment and ultimately, to successfully implement e-Invoice.1.3 The IRBM has issued e-Invoice Specific Guideline in response to the need for further guidance on specific areas of e-Invoice, aiming to aid taxpayers in gaining a better understanding of certain e-Invoice treatment and ultimately, to successfully implement e-Invoice.
2.1.4None1.4 The appendices to this document form part and parcel of this e-Invoice Specific Guideline. The information provided in the appendices provide additional guidance to taxpayers on how to complete the requirements for issuance of e-Invoice as well as to enhance taxpayers’ understanding on e-Invoice implementation using general and industry-specific examples.
3.Figure 3.1Diagram
4.3.6.5(a)
3.6.5(c)
3.6.5 Kindly note that consolidation does not apply to self-billed e-Invoice, except for the following self-billed circumstances:
(a) acquisition of goods or services from individual taxpayers (who are not conducting a business)
(b) interest payment to public at large (regardless businesses or individuals)
3.6.5 Kindly note that consolidation does not apply to self-billed e-Invoice, except for the following self-billed circumstances:
(a) transactions with individuals (who are not conducting a business)
(b) interest payment to public at large (regardless businesses or individuals)
(c) claim, compensation or benefit payments from the insurance business of an insurer to individuals (who are not conducting a business)
5.4.3.2Supplier is allowed to aggregate statements/ bills to create and submit consolidated e-Invoice for IRBM’s validation in accordance with the current issuance period for statements/ bills for the respective businesses.Supplier is allowed to aggregate statements/ bills to create and submit consolidated e-Invoice for IRBM’s validation in accordance with the current issuance period for statements/ bills for the respective businesses.
6.4.3.3Upon aggregation of statements/ bills, Supplier is required to create and submit a consolidated e-Invoice to IRBM for validation, within seven (7) calendar days after the end of the billing period (whichever applicable).Upon aggregation of statements/ bills, Supplier is required to create and submit a consolidated e-Invoice to IRBM for validation, within seven (7) calendar days after the end of the billing period (whichever applicable).
7.4.3.4
Step 3
Within seven (7) calendar days after end of the period (according to the issuance period as practice by the Supplier), Supplier will retrieve all the statements/ bills that were issued for the previous billing period and issue a consolidated e-Invoice as proof of Supplier’s income and expense.Within seven (7) calendar days after end of the billing month, Supplier will retrieve all the statements / bills that were issued for the previous billing month and issue a consolidated e-Invoice as proof of Supplier’s income and expense.
8.6.5 (a)Businesses will be allowed to proceed with the use of e-Invoice issued in the name of the employee or existing supporting document issued by the Supplier to support the particular transactions as proof of expense for tax purposesBusinesses will be allowed to proceed with the use of e-Invoice issued in the name of the employee or existing supporting documentation to support the particular transactions as proof of expense for tax purposes.
9.6.5 (b)In the event where payment in relation to perquisite and benefit is made to foreign suppliers, both employer and employee are not required to issue a self-billed e-Invoice. As such, IRBM will accept foreign supplier’s receipts / bills / invoices as a proof of expense.In the event where payment in relation to perquisite and benefit is made to foreign suppliers, both employer and employee are not required to issue a self-billed e-Invoice. As such, IRBM will accept foreign supplier’s receipts / bills / invoices or existing supporting documentation as a proof of expense.
10.7.4 (a)Businesses will be allowed to proceed with the use of e-Invoice issued in the name of the employee or existing supporting document issued by the Supplier to support the particular transactions as proof of expense for tax purposes.Businesses will be allowed to proceed with the use of e-Invoice issued in the name of the employee or existing supporting documentation to support the particular transactions as proof of expense for tax purposes
11.7.4 (b)In the event where employees paid for expenses incurred overseas, both employer and employee are not required to issue a self-billed e-Invoice. As such, IRBM will accept the foreign bills / receipts / invoices as a proof of expense.In the event where employees paid for expenses incurred overseas, both employer and employee are not required to issue a self-billed e-Invoice. As such, IRBM will accept the foreign bills / receipts / invoices or existing supporting documentation as a proof of expense.
12.8.3 (f)Acquisition of goods or services from individual taxpayers (who are not conducting a business) (applicable only if the other self-billed circumstances are not applicable)Transactions with individuals (who are not conducting a business) (applicable only if the other self-billed circumstances are not applicable)
13.8.3 (g) (i)Businesses (e.g., financial institutions, etc.) that charge interest to public at large (regardless businesses or individuals);Businesses (e.g., financial institutions, etc.) that charge interest to public at large (regardless of whether they are businesses or individuals);
14.8.3 (h)NoneClaim, compensation or benefit payments from the insurance business of an insurer
15.Example 15Adi has secured a mortgage loan from Bank Primaras, where he is subjected to a fixed annual interest rate of 3.75%. Adi will make an instalment payment to Bank Primaras on a monthly basis. This instalment is made up of two components: interest and principal.
In view that Adi is an individual making interest payment on loan to bank, Bank Primaras is required to issue e-Invoice (in the visual representation format of statement / bill) to Adi for the instalment in relation to mortgage loan, in accordance with the exception provided under Section 8.3(g)(i) of this e-Invoice Specific Guideline.
Adi has secured a mortgage loan from Bank Primaras, where he is subjected to a fixed annual interest rate of 3.75%. Adi will make an instalment payment to Bank Primaras on a monthly basis. This instalment is made up of two components: interest and principal.

In view that Adi is an individual making interest payment on loan to bank, Bank Primaras is required to issue e-Invoice to Adi for the instalment in relation to mortgage loan, in accordance with the exception provided under Section 8.3(g)(i) of this e-Invoice Specific Guideline.

Bank Primaras is required to issue the e-Invoice in XML / JSON format for the purposes of IRBM validation. Thereafter, Bank Primaras may E-INVOICE SPECIFIC GUIDELINE (VERSION 2.2) 63 generate a visual representation of the validated e-Invoice (in the form of statements / bills) for the purpose of sharing the e-Invoice with Adi.
16.8.5As the Buyer is required to assume the role of Supplier and issue self-billed e-Invoice, the Buyer is obliged to share validated self-billed e-Invoice with the Supplier upon validation.

Where the Buyer submits the self-billed e-Invoice for IRBM’s validation via MyInvois Portal, the visual representation of the self-billed e-Invoice generated from the MyInvois Portal will include a QR code, which can be used to validate the existence and status of the e-Invoice via the MyInvois Portal.

Where the Buyer submits the self-billed e-Invoice for IRBM’s validation via API transmission, in the event the Buyer shares the visual representation of the self-billed e-Invoice to the Supplier, the Buyer is required to ensure that the QR code is embedded accordingly prior to sharing it with the Supplier.
As the Buyer is required to assume the role of Supplier and issue self-billed e-Invoice, the Buyer is obliged to share validated self-billed e-Invoice with the Supplier upon validation.

Where the Buyer submits the self-billed e-Invoice for IRBM’s validation via MyInvois Portal, the visual representation of the self-billed e-Invoice generated from the MyInvois Portal will include a QR code, which can be used to validate the existence and status of the e-Invoice via the MyInvois Portal.

Where the Buyer submits the self-billed e-Invoice for IRBM’s validation via API transmission, in the event the Buyer shares the visual representation of the self-billed e-Invoice to the Supplier, the Buyer is required to ensure that the QR code is embedded accordingly prior to sharing it with the Supplier.

However, the IRBM acknowledges that there may be practical challenges in sharing the validated self-billed e-Invoice with the Supplier. Therefore, until further notice, the IRBM provides a concession allowing the Buyer to share either the validated self-billed e-Invoice or a visual representation of the validated self-billed e-Invoice with the Supplier.
17.8.6
Table 8.1 – No.8
NoneTransaction: Claim, compensation or benefit payments from the insurance business of an insurer

Supplier: Policyholder / Beneficiary

Buyer: Insurer
18.9.4.1Upon concluding a sale or transaction, the Agent / Dealer / Distributor is eligible to receive a payment or any other incentive (whether in monetary form or otherwise) from the Seller (e.g., commission).Upon concluding a sale or transaction, the Agent / Dealer / Distributor is eligible to receive a payment or any other incentive (whether in monetary form or otherwise) from the Seller (e.g., commission). The Seller is required to issue self-billed e-Invoice for the payment or any other incentive (whether in monetary form or otherwise), pursuant to Section 83A of the Income Tax Act 1967, made to Agent / Dealer / Distributor.
19.10.4.6The validated self-billed e-Invoice will serve as proof of expense for Malaysian Purchaser. Hence, the self-billed e-Invoice is not required to be shared with Foreign Seller and there would not be any request for rejection from Foreign Seller.The validated self-billed e-Invoice will serve as proof of expense for Malaysian Purchaser. The Malaysian Purchaser is not obliged to share the self-billed e-Invoice with the Foreign Seller.
20.14.5.2Upon implementation of e-Invoice, e-commerce platform provider is required to issue self-billed e-Invoice to Merchant and/or Service Provider for all transactions concluded on the e-commerce platform.Upon implementation of e-Invoice, e-commerce platform provider is required to issue self-billed e-Invoice to Merchant and/or Service Provider for all transactions concluded on the e-commerce platform.

Kindly note that the issuance of self-billed e-Invoice is for the purposes of complying with relevant tax legislation (e.g., Income Tax Act 1967, Labuan Business Activity Tax Act 1990, Petroleum (Income Tax) Act 1967) only and does not change the nature of transaction nor the commercial liability associated with the transaction.
21.Appendix 1
No.1
Genral TIN: “EI00000000010” as General Public’s TIN

Applicable to the following transaction:
i. Individual’s (i.e., Supplier, Buyer, Shipping Recipient) TIN in the e-Invoice for Malaysian individual where the individual only provides MyKad / MyTentera identification number
ii. Buyer’s TIN in the consolidated e-Invoice
Genral TIN: “EI00000000010” as General Public’s TIN
Applicable to the following transaction:
i. Individual’s (i.e., Supplier, Buyer, Shipping Recipient) TIN in the e-Invoice for Malaysian individual where the individual only provides MyKad / MyTentera identification number
ii. Buyer’s TIN in the consolidated e-Invoice
iii. Supplier’s TIN in the consolidated self-billed e-Invoice
22.Appendix 1
No.2
Genral TIN: “EI00000000020” as Foreign Buyer’s TIN

Applicable to the following transaction:
i. Buyer’s TIN in the e-Invoice for non-Malaysian individual where the individual buyer only provides passport number / MyPR / MyKAS identification number
ii. Buyer’s TIN for export transactions where foreign buyer’s TIN is not available or not provided
Genral TIN: “EI00000000020” as Foreign Buyer’s / Foreign Shipping Recipient’s TIN

Applicable to the following transaction:
i. Buyer’s TIN in the e-Invoice for non-Malaysian individual where the individual buyer only provides passport number / MyPR / MyKAS identification number
ii. Buyer’s TIN for export transactions where foreign buyer’s TIN is not available or not provided
iii. Shipping Recipient’s TIN for where foreign shipping recipient’s TIN is not available or not provided
23.Appendix 3
No. 6
Transaction: Acquisition of goods orservices from individual taxpayers who are not conducting a business

Supplier: Individual taxpayer providing goods or services

Buyer(assumes the role of Supplier and issue self-billed e-Invoice): Person acquiring goods or services
Transaction: Transactions with individuals who are not conducting a business

Supplier: Individual not conducting a business

Buyer(assumes the role of Supplier and issue self-billed e-Invoice): Person transacting with the individual not conducting a business
24.Appendix 3
No. 8
NoneTransaction: Claim, compensation or benefit payments from the insurance business of an insurer

Supplier: Policyholder / Beneficiary

Buyer(assumes the role of Supplier and issue self-billed e-Invoice): Insurer
25.Appendix 5NoneAPPENDIX 5 – GENERAL AND INDUSTRY-SPECIFIC FREQUENTLY ASKED QUESTIONS (FAQ)

The FAQ documents provided below, both general and industry-specific, are organised in a question-and-answer format to facilitate taxpayers’ understanding of e-Invoice. Note that these FAQs may be reviewed and updated from time to time and taxpayers should refer to IRBM e-Invoice microsite for the latest guidance.

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