Explore how e-invoicing solutions are transforming Malaysia’s retail industry, ensuring compliance, enhancing efficiency, and boosting economic contributions.
The retail industry in Malaysia is on the brink of a significant digital transformation with the upcoming implementation of the e-Invoice system. E-invoicing is set to reshape the way transactions are recorded, making processes smoother and more transparent. In simple terms, an e-invoice is a digital version of a traditional invoice, replacing paper invoices and credit or debit notes with an electronic format that meets regulatory requirements. Here’s a deep dive into how this implementation is set to unfold and why it matters to the retail industry in Malaysia.
An e-Invoice is a digital document that represents a transaction between a supplier and a buyer. It contains essential details, including:
While e-Invoices carry the same information as traditional paper documents, the advantage lies in their digital nature, making them easier to manage, store, and submit to tax authorities like the Inland Revenue Board of Malaysia (IRBM).
To ensure a smooth transition for businesses, the implementation of e-invoices is being rolled out in phases. The timeline takes into consideration the annual turnover of businesses, giving them sufficient time to adapt to the new system. Below is the timeline:
The Targeted Taxpayers for e-Invoicing implementation in Malaysia are divided into three groups, with specific Implementation Dates. Taxpayers with an annual turnover exceeding RM100 million will be required to comply by 1 August 2024. The next group, taxpayers with an annual turnover between RM25 million and RM100 million, must comply by 1 January 2025. Finally, all other taxpayers will need to adopt the e-Invoicing system by 1 July 2025.
Retailers need to prepare their systems in advance of these deadlines to ensure compliance with the new regulations.
The retail sector often deals with both types of customers: those who need e-invoices for tax purposes, and those who do not. Here’s how e-invoicing works for both:
For customers who require e-invoices, usually for commercial purposes or tax deductions, the process is as follows:
Step 1: Customer Request
When a customer requests an e-invoice, the retailer collects essential information such as the customer’s Tax Identification Number (TIN) or IC number.
Step 2: Real-time Validation
The retailer enters the customer’s data into their Point of Sale (POS) system and sends it to IRBM for validation.
Step 3: Notification
If IRBM finds no issues, both the supplier (retailer) and the buyer (customer) receive a notification of the validated e-invoice.
Step 4: E-Invoice Issuance
The retailer then sends the e-invoice, embedded with a QR code, to the customer. This code links to the validation on the MyInvois portal.
Step 5: View on MyInvois Portal
The customer can view their validated e-invoice on the portal, using it for tax purposes as proof of expense.
Many customers, especially those making purchases for personal use, do not require an e-invoice. For these transactions, retailers follow a different process:
Once an e-invoice is issued, there are additional processes retailers must handle:
The retail industry is a vital component of Malaysia's economy, consistently contributing a significant portion to the nation's Gross Domestic Product (GDP). Despite global economic fluctuations and local challenges such as the COVID-19 pandemic, Malaysia’s retail market has remained resilient and is expected to continue its upward trajectory.
Retail Industry E-Invoicing Implementation Solutions in Malaysia
To ensure seamless compliance with Malaysia’s e-invoice mandate, retail businesses can use platforms like Complyance, which offer the following benefits:
By utilising a solution like Complyance, retail businesses can enhance efficiency, ensure compliance with LHDN e-invoice requirements, and foster trust in their transactions.
As the retail industry in Malaysia moves toward full e-invoicing compliance, businesses need to embrace this digital transformation. Whether dealing with customers who request e-invoices or those who do not, following structured processes ensures seamless transactions and tax compliance. The growing retail industry in Malaysia, coupled with efficient e-invoice solutions, positions retailers to improve operational efficiency and contribute to the economy's continued growth. Retailers who adopt platforms like Complyance will be better equipped to stay ahead in this evolving market and ensure a smooth transition into the e-invoice era.
Im a skilled content writer and SEO expert crafting engaging articles that rank. Passionate about making complex topics clear, discoverable, and valuable to readers.Dedicated to driving organic growth through high-quality, search-optimized content
Get the latest compliance updates, e-invoicing news, and expert tips delivered to your inbox.
Empowering businesses to automate e-invoicing and stay compliant in 100+ countries. Our platform simplifies regulatory complexity for enterprises and fast-growing companies.
Complyance makes it easy for your dev team to integrate once and automate E-Invoicing across 50+ countries. Built for fast deployment, field-level validation, and indirect tax accuracy—no delays, no rework.
