Most businesses in Malaysia will need to switch to e-invoicing by 2026, but some are officially exempt. The Inland Revenue Board of Malaysia (IRBM) has been updating who has to comply and who falls outside the mandate since it started. Some entities, such as micro businesses, are permanently exempt, while others were given a temporary exemption.

If you’re wondering whether your business needs to comply, this page breaks down the latest exemption list, plus what’s changed as of August 2025.

Who Is Exempt from E-Invoicing?

As of mid‑2025, IRBM exempts the following entities from issuing e‑invoices via MyInvois:

  • Individuals not running a business
    If you don’t earn business income or operate a commercial entity, you don’t need to issue e‑invoices.

  • Foreign diplomatic offices
    Embassies and foreign missions continue to operate outside the mandate.

  • Statutory bodies & authorities (until 30 June 2025)
    These organisations don’t issue e‑invoices for fees, taxes or levies before 1  July  2025. The exemption ends thereafter.

  • International organisations (until 30 June 2025)
    Operations and commercial transactions must comply by mid‑2025.

  • Micro‑businesses with annual revenue below RM150,000
    Businesses under this threshold remain exempt, and there currently isn’t a start date set by IRBM yet.

  • Original 2025 update raised exemption threshold to RM500,000
    On 5  June  2025, IRBM raised the threshold for certain taxpayers, allowing businesses under RM500,000 to remain exempt from e‑invoicing even beyond mid‑2026.

What Changed in 2025?

There were a few key updates by the IRBM  throughout 2025 to ease the burden on small businesses:

  1. February 2025: IRBM formally extends compliance for businesses earning RM150,000–500,000 up to 1 January 2026, later known as Phase 4.

  2. June 2025: IRBM confirms that businesses with <RM500,000 remain exempt. Meanwhile, businesses earning between RM1 million to RM5 million now must comply from 1 July 2026 (Phase 5).

  3. Government response: Parliamentary committee and SME stakeholders raised concerns about the original RM150,000 threshold being too low and pushed for exemptions or higher thresholds. IRBM responded by granting longer grace periods and raising exemption limits.

These changes reflect government efforts to balance smooth implementation with fairness for micro and small enterprises.

Who Still Needs to Comply?

If your business operates in Malaysia and earns more than RM500,000 annually, you must issue e‑invoices per IRBM’s phased timeline. Required entities include:

  • Corporations

  • Partnerships & Limited Liability Partnerships (LLPs)

  • Co‑operative societies

  • Business Trusts

  • Unit Trusts, Property Trusts & Trust Bodies

  • Real Estate Investment Trusts (REITs)

  • Branches, representative offices

  • Associations & bodies of persons

If you earn between RM150,000 and RM500,000, your mandatory start date is January 2026. If you earn above RM1 million but less than RM5 million, your phase begins in July 2026.

📌 Are you uncertain about your revenue range? See our E‑Invoicing Timeline page for specific start dates by revenue bracket.

In Summary

The IRBM adjusts its e‑invoicing requirements to reflect practical realities on the ground. Current policy gives relief to micro and public sector entities, but most registered businesses need to prepare to comply according to their turnover bands.

If you’re still unsure, consult your tax advisor or stay informed through IRBM and media updates.