There There have been several articles in the media in the last two weeks complaining about the difficulties faced by taxpayers in implementing the e-invoice system. Currently, the implementation of e-invoicing is in the second phase, covering taxpayers with annual revenues from RM25 million to RM100 million.
Phase 1 began on 1 August 2024, while Phase 2 began on 1 January 2025. The Inland Revenue Board (IRB) has relaxed the implementation for all categories to allow six months to taxpayers to issue a single consolidated e-challan to record all transactions. Instead of issuing e-challan for each transaction made during that month.
What problems are impossible?
Most of the problems have arisen because taxpayers may not have spent enough time understanding the basic rules announced by the authorities.
It may be true that some of the rules may not be easy for taxpayers to interpret and hence, some confusion may arise among taxpayers in implementing e-invoices. Another reason for difficulty is that taxpayers are very busy in running their business and do not have enough time to understand the e-invoice rules. Many taxpayers are not accustomed to the concept of self-billing, which is new, and do not understand when to issue a self-bill e-challan.
Other common problems are employee claims, reimbursements and disbursements, intercompany transactions, providing goods and services for free, foreign payments, foreign receipts, payments on behalf of related companies and third parties, e-commerce transactions, payments and receipts. Through agents, interest payments to non-financial institutions, transactions with government bodies and government agencies.
Taxpayers also face problems in extracting relevant information from their databases to meet e-invoice compliance requirements. Here, 55 fields are required to submit e-challan to IRB. There are some issues in completing the fields such as the enterprise resource plan or the taxpayer’s accounting system may need to be updated or adapted to accommodate the 55 fields. Secondly, this information may not be readily available within the organization and may need to be collected from suppliers and customers, who may not be readily available.
There has been an issue about whether company representatives would have access to the organization’s confidential data or the personal information of directors appointed to represent the company.
This problem can be overcome if the director does not delegate this responsibility to another person in the organization and is personally involved in the appointment of the representative in the MyTax system. Once a representative is appointed, that person cannot have access to the director’s personal information. For company information, the IRB needs to put in place more security measures to ensure that directors can only appoint representatives for e-invoicing purposes which will not allow them to view the organization’s information.
While implementing the e-invoicing system, taxpayers are concerned about the tax implications of various operations such as self-billing and increased transparency of the data provided.
Essentially, this will happen because the intention of e-invoice is to surface any hidden transactions and hence prevent leakages in the tax system. If this is a matter of concern to you as a taxpayer, you should seek appropriate advice from your general professionals who advise you on tax matters and how to deal with it.
IRB has an excellent team to solve your problems. The e-Challan Helpdesk can be reached by emailing or calling 03-8682 8000, which is operational 24/7. myinvois@hasil.gov.myOr chatting live with IRB officials through their website. You can also find guidelines and FAQs on the IRB website (https://www.hasil.gov.my/en/e-invoice/,
This article is contributed by SM Thanneeramalai, Managing Director of Thannees Tax Consulting Services Sdn Bhd (www.thannees.com).
