In an effort to enhance tax compliance, minimize errors, and combat shadow economies, many nations have transitioned to e-invoicing systems. Following this global trend, Malaysia has now mandated e-invoicing. An e-invoice in Malaysia is a structured document in a specific format that can be automatically processed. The regime aligns with the interoperable Peppol e-invoicing framework, for which MDEC acts as the Peppol Authority for Malaysia. The framework further requires all e-invoices to be validated by Malaysia’s tax authority.
Malaysia’s e-invoicing framework distinctly outlines requirements for B2B, and B2G (Business to Government) transactions, and B2C entities.
Malaysia will follow two models for implementation of their e-invoicing mandate – the 3-corner model and the Peppol-based 4-corner model. e-Invoices, e-debit notes, e-credit notes, and e-refund notes can all be generated in the prescribed XML or JSON formats.
Small businesses with comparatively less transactions can register on the MyInvois portal hosted by the Inland Revenue Board of Malaysia (IRBM) and upload their e-invoices there. Other organizations must use APIs to integrate with the MyInvois system.
The Peppol-based 4 corner model requires both the buyer and the seller to work with Peppol service providers as direct integration is not permitted.
Regardless of the implementation model followed, disputes or errors in the e-invoices must be raised by the buyer and addressed by the supplier within 72 hours after it has been verified by the tax authorities and notification sent to the buyer.
SunTec e-Invoicing Solution ensures that Malaysian banks not only meet the compliance requirements efficiently but also optimize their invoicing processes. Our solution is equipped to meet the requirements of both the 3 corner and the Peppol-based 4 corner models that Malaysia is following.
