6-Month Grace Period For E-Invoicing Implementation Has Announced
Businesses are given additional time to smooth out the transition to e-invoice.
On July 26, 2024, the Inland Revenue Board of Malaysia (IRBM) announced a six-month grace period to allow businesses to adjust to the new e-invoicing system and requirements. At the time of publication, the 1st phase of e-invoicing has officially commenced for companies with an annual turnover of more than RM100 million.
What is the purpose of the grace period?
1. This allows businesses to transition to the new e-invoicing requirements without being prosecuted under Section 120 of the Income Tax Act 1967 for failure to comply with the e-invoicing provisions.
2. It is expected that this grace period will allow taxpayers sufficient time to ensure a complete transition to an electronic invoicing system. It addresses all aspects, including system availability, seamless business operations and management changes in businesses.
3. This allow IRBM to stabilize and optimize its system as it has received an overwhelming e-invoice submissions during the first day. It is clear that it needs more time for a stable e-invoice system throughout the country.
What’s Next?
1. All activities or transactions can issue consolidated e-invoices, including self-billed e-invoices.
2. Any transaction description must be included in the "Product or Service Description" area, and if the buyer requests an e-invoice, the seller can only issue a consolidated e-invoice instead of an e-invoice for each transaction.
3. While this provides more breathing space for e-invoicing implementation, taxpayers who successfully implement e-invoicing within the specified timeframe will be able to reduce their capital allowance claim period from 3 years to 2 years for the purchase of ICT equipment and computer software packages, effective from Assessment Year (AY) 2024 to 2025.
Conclusion
The implementation of e-invoicing in Malaysia is a significant step forward in modernizing the tax system and improving business transactions. The 6-month grace period is a valuable and necessary time to allow businesses to adjust to these changes and ensure they can comfortably comply with the new regulations. As the e-invoice system starting to implement across the country, companies are urged to prepare for the switch to e-invoicing to fully capitalize on the advantages it brings.
Sources:
https://assets.kpmg.com/content/dam/kpmg/my/pdf/e-invoicing-irb-media-release-29-july-2024.pdf
https://www.bernama.com/tv/news.php?id=2322309
How Goldsoft can help you:
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Option 1: Malaysia e-Invoice Ready ERP SolutionList Item 1
This solution direct integration of Goldsoft ERP with MyInvois System:
1. e-Invoices are generated in Goldsoft's ERP system and sent directly to the LHDN MyInvois System for validation. Once validated, embedded with a QR code containing the validation link, send to the client company.
2. This integration streamlines invoicing, reduces manual effort, minimizes errors, and ensures smoother transactions with the same vendor.
3. Client company is able to track and monitor e-invoice submissions, validation, and statuses in real-time.
4. Ideal for Malaysian retail and trading distribution companies needing e-invoice compliance system.
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Option 2: Malaysia e-Invoice Middleware Solution
This solution uses Goldsoft as middleware to connect client's existing software to the e-Invoicing network:
1. Clients can continue using their existing ERP/accounting system.
2. Enable client company to send e-invoices, using your existing ERP/accounting software, Goldsoft as a service provider to convert documents to standard specifications (XML/JSON) and send it to LHDN for validation. Once validated, embedded with a QR code containing the validation link, send to client company.
3. Client company is able to track and monitor e-invoice submissions, validations, and statuses in real-time.
4. Ideal for all Malaysian industries needing e-invoice compliance via API.
For more information about Goldsoft e-invoice Ready ERP/ e-invoice middleware, please do not hesitate to contact Goldsoft's sales team at 03-2732 8833 or fill up the form below for enquiry.
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