E-Invoicing Malaysia - The workflow

Introduction

An e-Invoice is a digital representation of a transaction between a supplier and a buyer. e-Invoice replaces paper or electronic documents such as invoices, credit notes, and debit notes.

An e-Invoice contains the same essential information as a traditional document, for example, supplier’s and buyer’s details, item description, quantity, price excluding tax, tax, and total amount, which records transaction data for daily business operations.

Is e-invoicing mandatory in Malaysia?

Malaysia will introduce a countrywide e-invoicing mandate from June 2024.

The Malaysian government plans to introduce a Centralized Pre-Clearance CTC model on all transactions to increase efficiency and strengthen the tax administration. A gradual introduction of the obligation will commence in June 2024 and end in 2027.

An Overview of Workflow of E-Invoicing

Today we will highlight the workflow of e-invoicing in general.

1. Issuance of e-Invoice

When a sale or transaction is made (including e-Invoice adjustments), the supplier creates an e-Invoice and shares it to IRBM via MyInvois Portal or API for validation.

2. Validation of e-Invoice

IRBM validation is performed in real-time, ensuring that the e-Invoice meets the necessary standards and criteria.

Once validated, the supplier will receive a Unique Identifier Number from IRBM via MyInvois Portal or API.

The Unique Identifier Number will allow traceability by IRBM and will reduce instances of tempering with the e-Invoice.

3. Notification of validated e-Invoice

IRBM will inform both the supplier and buyer once e-Invoice has been validated via MyInvois Portal or APIs.

4. Sharing of e-Invoice

Upon validation, the supplier is obliged to share the cleared e-Invoice (embedded with a QR code) with the buyer.

The QR code can be used to validate the existence and status of the e-Invoice via IRBM’s official portal.

5. Rejection or cancellation of e-Invoice

Upon issuance of e-Invoice, a stipulated period of time is given to:

• Buyer to request for rejection of the e-Invoice

• Supplier to perform cancellation of e-Invoice

Rejection requests or cancellations must be accompanied by justification.

6. MyInvois Portal

Supplier and buyer will able to obtain a summary of the e-Invoice transactions via MyInvois Portal.

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