IRBM Publishes January 2025 Updates to E-Invoice Guidelines

The Inland Revenue Board of Malaysia (IRBM) has released further revisions to Malaysia’s e-invoicing framework, introducing new exemptions and updated rules for self-billed transactions.

On 28 January 2025, IRBM published:

• E-Invoice Guideline Version 4.1
• E-Invoice Specific Guideline Version 4.0

These updates focus on self-billing requirements, consolidation rules, and additional exemptions.

Key Updates in Guideline Version 4.1

Guideline v4.1 introduces an expanded list of international organizations that are exempt from issuing e-invoices, including self-billed e-invoices.

Updates to Self-Billing Rules in Specific Guideline Version 4.0

Consolidation of Self-Billed Transactions

As a general rule, consolidation does not apply to self-billed e-invoices. However, the updated guidelines allow consolidation in limited scenarios:

• Claims, compensation, or benefit payments by insurance companies to:
  • Individuals not conducting a business
  • Government entities
  • State authorities
• Self-billing transactions involving a taxpayer’s overseas branches or offices

New Transactions Requiring Self-Billed E-Invoices

Buyers are now required to issue self-billed e-invoices for payments related to:

• Capital reduction
• Share, capital, or unit redemption
• Share buybacks
• Return of capital
• Liquidation proceeds

Exceptions to Self-Billed Invoice Issuance

While self-billed e-invoices are generally required for interest payments, the guidelines confirm several exceptions.

Existing exceptions include:

• Interest charged by businesses, such as financial institutions, to the public
• Interest payments made by employees to employers
• Interest paid by foreign payors to Malaysian taxpayers

Additional exceptions introduced in this update include:

• Interest paid to a related Malaysian-incorporated company providing centralized treasury services to its affiliates. Mandatory from 1 July 2025
• Late payment interest or charges imposed by Malaysian taxpayers

These clarifications provide greater certainty on when self-billing is required and how consolidation may be applied under Malaysia’s evolving e-invoicing framework.