Small traders have leeway

MICRO-SMEs earning less than RM150,000 annually are not required to issue e-invoices, says Finance Minister II Datuk Seri Amir Hamzah Azizan.

“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,” he said during Question Time yesterday.

Amir said the government is aware of challenges that mSMEs will face in implementing the e-invoicing mechanism, such as higher operating costs, technology application and a lack of knowledge regarding e-invoicing.

Therefore, he said the government decided to allow mSMEs to issue consolidated e-invoices, which is a form of digital receipts that combines all sales transactions in a monthly manner.

“It only has to be given to the Inland Revenue Board (LHDN) within the first seven days of the month,” said Amir.

“The mSMEs can use the MyInvois portal for e-invoicing purposes without any extra charges.”

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

“(There is also) a tax break of up to RM50,000 for each assessment year for the expenses of consulting fees borne by mSMEs from the 2024 assessment year till 2027,” added Amir.

The government will ensure the transition period to e-invoicing can be implemented by taking the “educate and correct” approach.

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

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

Businesses with revenue between RM25mil and 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.