If you run an e-commerce business, you’re probably already stretched thin. Between delayed payouts from marketplaces, high return rates, refund disputes, and constant restocking costs, it can feel like your cash flow never catches up.
Now, there’s one more thing to prepare for: mandatory e-invoicing.
Starting in 2024, online sellers and platforms will be required to issue e-invoices for sales, commissions, fees, and even refunds. It’s meant to streamline tax compliance, but in reality, it could disrupt your current processes if you’re not ready.
In this guide, we break down how e-invoicing applies to e-commerce, common transaction types to look out for, and what you can do to manage the transition without hurting your cash flow. We also share financing options from Funding Societies that can help if your business needs a buffer.
For a comprehensive guide to the e-invoicing initiative by the Inland Revenue Board of Malaysia (IRBM), including the latest timelines and regulations, Read our e-invoicing Malaysia guide here.
What E-Invoicing Means for E-Commerce Businesses
From 1 August 2024, businesses with RM100 million or more in annual turnover must start issuing e-invoices. Others will follow in later phases, based on their income bracket. Review the official e-invoicing rollout schedule to determine when your business needs to comply.
For e-commerce businesses, this means:
- Every online sale must be properly recorded with an e-invoice
- Fees and commissions charged to merchants must be invoiced
- Refunds need to be tracked with official credit notes
- All income and expenses must match digital records submitted to IRBM
It’s no longer enough to rely on backend sales reports or third-party dashboards. You’ll need clear invoicing processes across every channel — whether you’re selling through Shopee, Lazada, TikTok Shop, or your own website.
Which E-Commerce Transactions Require E-Invoicing
According to IRBM’s official guide, here’s what falls under the e-invoicing scope:
Sales and Income:
- Sale of goods or services through e-commerce platforms
- Commissions and fees charged to merchants
- Advertising or promotional services offered to merchants
Expenses:
- Payments to delivery partners or 3PL services
- Software tools or platform subscriptions
- Warehouse or storage fees
- Influencer and paid marketing spend
- Customer service outsourcing or agency work
Keeping track of both income and expenses in e-invoice format helps prevent tax issues and audit risks down the line.
For detailed information, refer to IRBM’s official guidelines for the e-commerce industry here.
Who Issues the E-Invoice in Online Sales
Here’s how invoicing responsibilities are split:
- If you sell through a platform (e.g. Shopee, Lazada): The platform issues the e-invoice to the buyer.
- If you sell directly (via your own website or WhatsApp): You must issue the e-invoice to your customer.
- If you’re the platform charging fees to sellers: You must issue an e-invoice to the merchant for those charges.
You’ll also need to issue credit notes for cancelled orders, returns, and refunds to keep your tax records aligned. Learn how the e-invoicing process works, including validation and rejection timelines.
E-Invoicing Challenges for E-Commerce Sellers
For many SMEs, e-invoicing won’t just be a simple plug-and-play:
- Payout delays remain — Marketplaces may still take 14 to 30 days to release funds, even if you invoice immediately.
- Cash flow timing is tricky — You still need to pay for ads, restocks, and delivery while waiting to get paid.
- High volume, low margin — Selling hundreds of small-ticket items makes invoice tracking harder.
- Return and refund headaches — You’ll need to issue credit notes for each return to stay compliant.
- System upgrades cost money — Some sellers may need new software or third-party solutions to integrate with MyInvois.
How to Get Started with E-Invoicing
Here’s a simple step-by-step for SMEs in e-commerce:
Step 1: Check your system
Make sure your website, POS, or accounting system can generate and store e-invoices. Some platforms like Shopify or WooCommerce may need plugin integration. See what fields and formats your e-invoice must follow to stay compliant.
Step 2: Pick a MyInvois-compliant provider
Choose a solution that connects with IRBM’s validation system, can handle credit notes, and stores records securely for seven years.
Step 3: Standardise your workflows
Map out how your team handles refunds, fees, and multi-channel sales. Ensure you’re not duplicating or missing invoices.
Step 4: Train your team
Your ops, finance, and customer service teams need to understand who issues what, and when.
Step 5: Test before full rollout
Try it with one channel or one product line first. Sort out kinks before expanding across your store.
How Funding Societies Helps You Stay Liquid During the Transition
While e-invoicing offers long-term benefits like better compliance and financial visibility, the transition isn’t always easy for e-commerce businesses — especially those managing thin margins, high return rates, and unpredictable cash flow.
Many sellers and platforms will face:
- Software upgrades and integration costs to connect sales systems to the MyInvois platform
- Training expenses to get finance, ops, and support teams up to speed
- Payout delays from platforms or B2B customers, which still stretch up to 30–90 days even after invoicing
- Ongoing expenses like ad spend, restocking, warehousing, and fulfilment
- Limited working capital during a time when you’re also investing in compliance and digital tools
This financial pressure can stall growth or force sellers to hold back on marketing, inventory, or platform expansion.
That’s where Funding Societies can support your e-commerce business with flexible, fast, and Shariah-compliant financing solutions.
Invoice Financing
Convert your issued e-invoices into upfront working capital.
With a credit line of up to RM1 million and tenure up to 120 days, this is ideal for managing supplier payments, shipping costs, and ads while waiting for marketplace or customer payouts.
Micro Financing
Fast, collateral-free financing of up to RM200,000 tailored for growing e-commerce sellers.
Use it to fund digital tool upgrades, staff onboarding, or seasonal inventory restocks — especially useful when you need to invest before the revenue kicks in.
Islamic Financing Options
Shariah-compliant financing is available across select products.
Ideal for entrepreneurs looking for ethical funding solutions that align with their business values while still meeting working capital needs.
Remember, don’t wait until cash flow becomes a problem. Plan ahead and use financing to stay competitive, fulfil orders smoothly, and grow confidently during the e-invoicing transition.
Final Thoughts: Make E-Invoicing Work for You
E-invoicing isn’t just about staying compliant — it’s a chance to professionalise your operations, reduce manual admin, and improve financial visibility.
If you prepare early and manage your cash flow well, you’ll not only stay ahead of the regulation but also position your business for smarter growth.
