Who is exempt from e-Invoice in Malaysia? 2026 thresholds & phases

If you run a Malaysian company, the two questions that actually matter about e-Invoice are simple: "Am I exempt?" and "If not, when is my deadline?" Both are decided almost entirely by your annual turnover, with a short list of special exemptions on top. This guide answers both precisely, using the Inland Revenue Board of Malaysia's (LHDN / HASiL) own published thresholds, so you can place your business on the timeline in a couple of minutes. It is the exemptions-and-thresholds companion to our fuller e-Invoice employer guide, which walks through the MyInvois workflow itself.

Carriera works with employers across logistics, manufacturing, retail and professional services, and the line we hear most is: "We're not sure we even need to do this yet." The figures below are checked against LHDN's timeline and the IRBM e-Invoice Guideline, with every number sourced inline — never assume a threshold; confirm your own audited turnover.

Is my business exempt from e-Invoice in Malaysia?

Your business is exempt from e-Invoice purely on turnover only if its annual turnover or revenue is below RM1,000,000. The official HASiL e-Invoice Implementation Timeline states plainly that "taxpayers with an annual turnover or revenue of less than RM1,000,000 are exempted from e-Invoice implementation." If you are above that line, you are inside the mandate — the only remaining question is which phase you sit in.

One caution for owners hovering near the line. The RM1 million exemption was raised from the earlier RM500,000 figure, and it is keyed to your real audited turnover — not a rough estimate. If you are a subsidiary or related company within a larger group, take advice on how the group is assessed, because being below RM1 million on your own books does not automatically settle it. For the vocabulary used here — turnover, consolidated e-Invoice, TIN, MyInvois — see our glossary.

When is my e-Invoice phase deadline based on turnover?

Your e-Invoice go-live date is set by the turnover band you fall into under LHDN's four-phase rollout. The largest companies started first (1 August 2024) and the smallest mandated band — above RM1 million up to RM5 million — went live on 1 January 2026. That means every mandated band is already live today; there is no future phase still waiting to begin. Find your row below.

Phases, turnover bands and dates: HASiL e-Invoice Implementation Timeline (revised 7 December 2025). Phase 4 relaxation extension: VATupdate — Specific Guideline v4.7.

Read this as a self-assessment grid: locate your audited annual turnover in the left column and your obligation is on the same row. Because Phase 4 closed the last mandated band on 1 January 2026, a business above RM1 million that has not yet started is already past its go-live date — protected for now only by the relaxation period explained in § 05, not by any remaining grace before the mandate applies.

Which persons are exempt from issuing e-Invoice?

Beyond the turnover threshold, the IRBM e-Invoice Guideline lists specific persons who are exempt from issuing e-Invoices (including self-billed e-Invoices) whatever their turnover. As summarised in EY Malaysia's tax alert on the IRB guidelines, the exempt persons are:

• Ruler and Ruling Chief; Former Ruler and Ruling Chief; and the Consort of a Ruler of a State (Raja Perempuan, Sultanah, Tengku Ampuan, Raja Permaisuri, Tengku Permaisuri or Permaisuri).
• The Government; State government and state authority; Government authority; and Local authority.
• Statutory authority and statutory body — including facilities they operate, such as hospitals, clinics and multipurpose halls.
• Consular offices and diplomatic officers, consular officers and consular employees (foreign diplomatic offices).
• An individual who is not conducting a business.

There is a critical catch for the private sector. A company or limited liability partnership owned by one of these exempt persons is not itself exempt — it must implement e-Invoice like any other business. So the exemption attaches to the office or the non-business individual, not to commercial entities they happen to own. This list is reviewed and updated by the IRB from time to time, so always re-check the current LHDN e-Invoice Guidelines before relying on it.

Which income or expense types are exempt from e-Invoice?

Certain types of income and expense are also exempt — meaning no e-Invoice (or self-billed e-Invoice) is required for them even when a business is otherwise inside the mandate. Per the IRBM guideline as reported by EY and BDO Malaysia, these include:

Exempt persons and income/expense types: IRBM e-Invoice Guideline, via EY Malaysia and BDO Malaysia. Always confirm against the live LHDN guideline, as the list is updated periodically.

The practical point: even an exempt employer still issues normal e-Invoices for its ordinary sales — the exemption only removes the listed income and expense items (like payroll and pensions) from the e-Invoice net, not the business as a whole.

Can I still consolidate small transactions into one e-Invoice in 2026?

You can still issue a single monthly consolidated e-Invoice for low-value sales where the buyer does not ask for an individual e-Invoice — but there is now a hard ceiling. From 1 January 2026, any single transaction of RM10,000 or more can no longer be lumped into a consolidated e-Invoice; it must be issued as its own validated e-Invoice. This is one of the most consequential 2026 changes for high-ticket sellers, and it is confirmed by ClearTax's phase guidance: "effective 1 January 2026, individual e-invoices are mandatory for transactions above RM10,000; consolidated invoices are not allowed."

Two things to note. First, the RM10,000 rule applies even during the Phase 4 relaxation period — the relaxation does not soften it. Second, it bites hardest in sectors with frequent large single sales: construction, wholesale, manufacturing, professional services and high-value retail. If your average ticket sits around or above RM10,000, your consolidation habit needs to change first, before anything else.

Does the relaxation period mean a Phase 4 business can ignore e-Invoice?

No. The relaxation period postpones penalties; it does not postpone the obligation to start. Phase 4 businesses (turnover above RM1 million up to RM5 million) were still required to implement e-Invoice from 1 January 2026. The interim relaxation simply removes penalties for certain gaps and allows consolidated e-Invoices for most transactions while teams find their feet.

That interim relaxation for Phase 4 was extended to 31 December 2027, announced by the Prime Minister and reflected in e-Invoice Specific Guideline version 4.7, as reported by BusinessToday and VATupdate. Full enforcement begins on 1 January 2028. But the RM10,000 individual-invoice rule still applies right through the relaxation — so treat the window as time to train and test your process, not a reason to defer.

How do I get my finance team ready — and can I claim the training?

Once you know your phase and which transactions need individual e-Invoices, the last step is making sure your finance and accounts staff can actually do it — and that cost can be funded from training levy you already pay. Under the PSMB Act 2001, employers register with HRD Corp and can use the levy, via the SBL-Khas scheme, to fund approved training. Verify your exact levy position on the official HRD Corp portal; our HRD Corp levy guide and claim guide walk through the mechanics.

Carriera Academy is an HRD Corp Approved Training Provider, and our tax-and-finance programmes — covering e-Invoice, SST and LHDN obligations — are delivered by experienced trainers and are SBL-Khas claimable. We have supported 50+ companies across Malaysia with their people and compliance needs. Because live sessions are pulled in real time rather than fixed on a page, browse current dates on our training page, or read more about the tax, SST & e-Invoice training cluster.

This guide is general information, not tax or legal advice. Always verify your specific obligations against the latest LHDN / HASiL e-Invoice guideline or your tax agent. Figures here are current as of 18 June 2026.