PUTRAJAYA (May 23): The implementation of e-Invoice for Micro, Small and Medium Enterprises (MSMEs) will begin on July 1, 2025, and not this Aug 1, according to the Inland Revenue Board (LHDN).

LHDN clarified that the first phase of e-Invoice implementation on Aug 1 is only applicable to companies with annual turnover or revenue exceeding RM100 million.

In a statement, LHDN said there is no requirement now for companies in the first phase to obtain e-Invoices from MSMEs for expense claims purposes.

"Therefore, MSMEs can continue their business as usual and do not need to issue e-Invoices starting this Aug 1.

"Generally, at the initial stage of e-Invoice implementation, there is no need for any taxpayer to obtain e-Invoices as proof for expense claims," the statement said.

The statement was issued following a comment by MCA president Datuk Seri Dr Wee Ka Siong on whether MSMEs need to issue e-Invoices to companies with annual revenue or turnover exceeding RM100 million starting this Aug 1.

To assist and facilitate the submission of e-Invoices, LHDN is providing the MyInvois Portal and Point of Sales (POS) System that can be used free of charge by MSMEs for all transactions, including any amendments.

"At the initial stage of e-Invoice implementation for MSMEs, MSMEs do not need to issue e-Invoices for every sales transaction.

"... but are allowed to issue a consolidated e-Invoice that combines all MSME sales transactions each month, and it only needs to be submitted to LHDN within the first seven days of the following month," the statement said.

Additionally, LHDN said MSMEs only need to fill out six of the 55 data fields to complete the e-Invoice, and other information will be pre-filled automatically.

In the year leading up to the full implementation of e-Invoice on July 1, 2025, LHDN is actively conducting programmes and engagement sessions nationwide for awareness and education purposes.

The implementation of e-Invoice has also taken into account the requirements of the Sales and Service Tax (SST), with all relevant SST information included as e-Invoice data fields.

"Based on this explanation, the implementation of e-Invoice should not result in price increases or increased business costs for MSMEs," the statement said.

LHDN stressed that failure to issue e-Invoices is an offence under the Income Tax Act 1967.

The minimum penalty that can be imposed is RM200 and the maximum is RM20,000, depending on the facts of each case.