Malaysia’s e-Invoicing rollout has entered a new phase and for many micro, small and medium enterprises, this is a significant and welcome update.
The Ministry of Finance and LHDN have officially revised the implementation timelines for businesses earning below RM5 million annually. Alongside extended deadlines, the government has also increased the exemption threshold, giving smaller businesses more time and flexibility to prepare.
Here is what has changed and what it means for your business.
Revised e-Invoicing Phases for MSMEs
The government has introduced new implementation phases for businesses earning under RM5 million annually:
| Business Annual Revenue | New Mandatory Start Date |
| RM5 million – RM25 million | 1 July 2025 |
| RM1 million – RM5 million | 1 January 2026 |
| Up to RM1 million | 1 July 2026 |
| Below RM500,000 | Temporarily exempted |
This replaces the earlier plan to implement mandatory e-Invoicing for all MSMEs by July 2025.
Exemption Threshold Increased to RM500,000
One of the most impactful changes is the increase in the exemption threshold:
- Businesses with annual revenue below RM500,000 are currently not required to implement e-Invoicing
- This is a significant jump from the previous RM150,000 threshold
- It offers relief to micro-businesses that may not yet be operationally ready
Grace Period and Consolidated e-Invoice Flexibility
To ensure a smoother transition, LHDN has introduced several practical flexibilities during the initial adoption phase.
Businesses may issue consolidated e-Invoices instead of generating an individual e-Invoice for every transaction.
Self-billed consolidated e-Invoices are also permitted.
If a buyer requests an e-Invoice, the seller may provide a consolidated e-Invoice rather than issuing separate invoices for each transaction.
No prosecution will be initiated under Section 120 of the Income Tax Act 1967 during the grace period, provided consolidated e-Invoice requirements are met.
These measures are designed to help MSMEs maintain business continuity while transitioning to digital tax processes.
What This Means for Malaysian Businesses
The revised timelines provide more than regulatory relief. They represent a shift towards a more practical, readiness-based implementation approach.
Businesses now have additional time to evaluate system compatibility, plan internal workflows, integrate accounting platforms and train teams. At the same time, the mandatory nature of e-Invoicing remains unchanged. Once the respective phase becomes active, compliance will be required.
Early preparation allows businesses to avoid last-minute system changes, operational disruptions and compliance risks.
How Advintek Supports MSMEs in This Transition
Advintek helps businesses across Malaysia implement compliant, scalable e-Invoicing without operational complexity.
With Advintek, businesses can:
- Automate invoice generation and submission
- Integrate directly with accounting and ERP systems
- Issue consolidated and self-billed e-Invoices easily
- Stay compliant as regulations evolve
- Prepare early, avoiding last-minute system changes
Whether your business is required to comply in 2025, 2026, or is currently exempt early preparation puts you in control.
