Micro SMEs earning below RM150,000 annually exempted from e-invoicing, says Amir Hamzah

Micro SMEs earning below RM150,000 annually exempted from e-invoicing, says Amir Hamzah

KUALA LUMPUR: Micro, small and medium enterprises (MSMEs) that are earning less than RM150,000 annually are not required to issue e-invoices, says Finance Minister II Datuk Seri Amir Hamzah Azizan (pic).

“For now, traders with annual sales below RM150,000 are not required to issue e-invoices.

“But the government encourages the participation of small traders in the e-invoicing initiative which is in line with the national aspiration of digitalising businesses,” said Amir Hamzah during Question Time in Parliament on Tuesday (July 2).

He said the government is aware of challenges that MSMEs will face in implementing the e-invoicing mechanism, such as higher operating costs, information technology system upgrade and lack of knowledge regarding e-invoicing.

Therefore, Amir Hamzah said the government decided to allow MSMEs to issue consolidated e-invoices, which is a form of digital receipts that combines all sales transactions on a monthly basis.

“It (e-invoice) only has to be given to the Inland Revenue Board (LHDN) within the first seven days of the month,” he added.

Amir Hamzah said MSMEs could use the MyInvois portal for e-invoicing purposes without any extra charges.

He also said that for dealers who chose to develop their own system or use a solutions provider, tax incentives will be provided, such as reduction of capital allowance claim period from four years to three years for the purchase of devices and computer software beginning in the 2024 assessment year.

“A tax break of up to RM50,000 for each assessment year will be given for consultation fee expenses borne by MSMEs from the 2024 assessment year till 2027,” he said.

Amir Hamzah said the government will ensure that the transition period to e-invoicing can be successfully implemented by taking the “educate and correct” approach.

“The government remains committed to helping all companies, including MSMEs in implementing e-invoicing,” added Amir.

Beginning Aug 1 this year, taxpayers with annual turnover exceeding RM100mil are required to implement e-invoicing.

Businesses with revenue between RM25mil and up to RM100mil must implement e-invoicing by Jan 1 next year.

By July 1 next year, all other businesses, including SMEs, hawkers and traders are required to adopt e-invoicing.