In Malaysia, e-invoicing is a mandatory system for businesses to ensure tax compliance and promote transparency. However, there are some nuances when it comes to the timing of e-invoice submission. While it’s important to stay compliant, businesses may wonder whether they need to submit an e-invoice on the same day a transaction occurs.
Understanding E-Invoice Submission Deadlines in Malaysia
Here’s a breakdown of the timing requirements for various types of e-invoices:
- Consolidated E-Invoice:
Suppliers are required to submit consolidated e-invoices within seven (7) calendar days after the end of the month. This rule applies to B2C transactions, helping businesses streamline their reporting.
- Self-Billed E-Invoice for Imported Goods:
For Malaysian purchasers, the self-billed e-invoice must be issued by the end of the month following the customs clearance. This means businesses have a little more time to prepare and submit the e-invoice.
- Self-Billed E-Invoice for Imported Services:
The e-invoice for imported services must be submitted by the end of the month following the payment or the receipt of the invoice from the foreign supplier—whichever comes first.
- E-Invoice for Foreign Income:
In cases where foreign income is involved, the e-invoice must be submitted by the end of the month following the receipt of income. This ensures that businesses keep track of their foreign transactions accurately for tax purposes.
While these guidelines outline specific deadlines for certain scenarios, businesses are generally not required to issue e-invoices on the same day as the transaction unless otherwise specified.
Can Businesses Issue Consolidated E-Invoices Without Buyer Requests?
In Malaysia, businesses must follow specific rules for issuing e-Invoices depending on the type of transaction. Let’s break down the key points:
1. B2B (Business-to-Business) and B2G (Business-to-Government) Transactions:
- B2B and B2G transactions follow real-time transaction compliance. This means that businesses must issue e-Invoices as soon as a transaction occurs.
2. B2C (Business-to-Consumer) Transactions:
- For B2C transactions (where the buyer is a consumer without a TIN no.), the rules are more relaxed.
- Consolidated e-Invoices can be issued even if the buyer does not request an e-invoice. There are no strict requirements for real-time compliance or TIN validation in B2C transactions provided buyer does not request an e-invoice.
- This means businesses have more flexibility and can issue a single, consolidated invoice for multiple consumer transactions, making the process simpler.
Key Differences:
- B2B and B2G: Real-time compliance is required, and a valid TIN is needed. If the TIN is missing, a consolidated e-Invoice can still be issued.
- B2C: Real-time invoicing is not mandatory unless the buyer specifically requests an e-invoice. For all other B2C transactions, businesses have the option to issue consolidated e-invoices.
Consequences for Failing to Issue an E-Invoice
Failure to comply with the e-invoicing requirements in Malaysia can result in severe penalties. According to Section 120(1)(d) of the Income Tax Act 1967, businesses that fail to issue e-invoices when required can face a fine of not less than RM200 and not more than RM20,000 or imprisonment for up to 6 months—or both. This highlights the importance of adhering to the deadlines and rules related to e-invoicing to avoid costly consequences.
Key Takeaways
- B2B and B2G Transactions: Real-time e-Invoice submission is followed for B2B and B2G transactions, and a valid TIN is required. If no request for an e-invoice is made, businesses can issue a consolidated e-Invoice instead of individual invoices.
- B2C Transactions: Businesses have more flexibility for B2C transactions. Consolidated e-Invoices can be issued provided the buyer does not request an e-invoice.
- Compliance is Crucial: Failing to comply with e-invoicing regulations can result in fines or imprisonment. Ensure that e-invoices are submitted within the specified deadlines to avoid penalties.
For businesses in Malaysia, understanding these e-invoice submission rules and deadlines is essential for maintaining tax compliance and avoiding penalties. Make sure to stay informed about the specific guidelines and always submit your e-invoices within the stipulated timelines.
Frequently Asked Questions
Do businesses need to submit an e-Invoice the same day as the transaction?
For B2B and B2G transactions, real-time e-invoice submission is required with a valid TIN, though businesses can issue consolidated e-invoices if no request for an e-invoice is made. For B2C transactions, businesses can issue consolidated e-invoices unless the buyer specifically requests an e-invoice.
What is the deadline for submitting a consolidated e-Invoice?
For consolidated e-Invoices, suppliers must issue the invoice within seven (7) calendar days after the end of the month.
When should a self-billed e-Invoice for imported goods be issued?
For imported goods, Malaysian purchasers must issue a self-billed e-Invoice by the end of the month following the month of customs clearance.
What is the deadline for self-billed e-Invoice for imported services?
For imported services, the self-billed e-Invoice must be issued by the end of the month following either the payment date or the receipt of the invoice from the foreign supplier, whichever comes first.
When should an e-Invoice for foreign income be issued?
For foreign income, the e-Invoice must be issued by the end of the month following the receipt of the foreign income.
Can businesses issue consolidated e-Invoices for transactions where the buyer does not request one?
Yes, businesses can issue consolidated e-Invoices for transactions when, no request for e-invoice has been made by the buyer, whether B2B, B2C, or B2G, unless restricted by specific legislation.
