{"id":1484,"date":"2026-09-07T03:14:54","date_gmt":"2026-09-07T03:14:54","guid":{"rendered":"https:\/\/companysecretary.my\/?p=1484"},"modified":"2026-09-07T03:14:54","modified_gmt":"2026-09-07T03:14:54","slug":"e-invoice-exemption-below-rm3-million-malaysia-2026","status":"publish","type":"post","link":"https:\/\/companysecretary.my\/bm\/2026\/09\/07\/e-invoice-exemption-below-rm3-million-malaysia-2026\/","title":{"rendered":"Businesses Below RM3 Million Are Now Exempted from e-Invoice \u2014 Here\u2019s What You Need to Know"},"content":{"rendered":"\t\t
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There is good news for business owners and SMEs in Malaysia.<\/p>\n

On 30 August 2026<\/strong>, the Inland Revenue Board of Malaysia (HASiL) announced an increase in the exemption threshold for e-Invoice implementation.<\/p>\n

Under the latest requirements, taxpayers with annual turnover or revenue of less than RM3 million are exempted from implementing e-Invoice<\/strong>, subject to the eligibility criteria prescribed by HASiL.<\/p>\n

At MSIB, we see this as a positive development, particularly for small and medium-sized businesses that may still be adapting their operations to the e-Invoice system.<\/p>\n

But we also know the question that is probably on the minds of many business owners right now:<\/p>\n

\u201cMy company\u2019s sales are below RM3 million. Does that mean my company is exempted from e-Invoice?\u201d<\/strong><\/p>\n

The short answer is: possibly yes \u2014 but there are a few important things you should check first.<\/strong><\/p>\n

Let us walk you through them in simple terms.<\/p>\n

What Has Actually Changed?<\/strong><\/h5>\n

The implementation of e-Invoice in Malaysia has been introduced progressively based on a business\u2019s annual turnover or revenue.<\/p>\n

Under the latest development announced by HASiL on 30 August 2026<\/strong>, the exemption threshold has been increased.<\/p>\n

Generally:<\/p>\n

\n

Taxpayers with annual turnover or revenue of less than RM3,000,000 are now exempted from implementing e-Invoice.<\/strong><\/p>\n<\/blockquote>\n

This means that a significant number of small businesses in Malaysia may now potentially benefit from this exemption.<\/p>\n

However, there is one important point we want our clients and fellow business owners to understand.<\/p>\n

Don\u2019t look at the RM3 million figure alone.<\/h5>\n

To determine whether a business actually qualifies for the exemption, we may also need to consider its ownership structure and relationship with other companies.<\/strong><\/p>\n

4 Things You Should Check<\/h5>\n

If your company\u2019s sales or revenue are below RM3 million, try answering these four simple questions.<\/p>\n

1. What Is Your Company\u2019s Annual Turnover or Revenue?<\/strong><\/p>\n

Let\u2019s start with the most basic question.<\/p>\n

For example:<\/p>\n

ABC Trading Sdn. Bhd.<\/strong>
Annual Revenue: RM850,000<\/strong><\/p>\n

Since the amount is below RM3 million, ABC Trading falls within the relevant revenue threshold.<\/p>\n

But our assessment doesn\u2019t end there.<\/strong><\/p>\n

We now move to the second question.<\/p>\n

2. Who Are Your Company\u2019s Shareholders?<\/strong><\/p>\n

This is something that some business owners may not immediately think about when considering e-Invoice.<\/p>\n

Let\u2019s say ABC Trading has annual revenue of RM850,000.<\/p>\n

Its shareholders are:<\/p>\n

Ali \u2014 50%<\/strong>
Abu \u2014 50%<\/strong><\/p>\n

Both are individuals.<\/p>\n

From the perspective of this particular criterion, the situation is relatively straightforward.<\/p>\n

But what if ABC Trading is instead owned by:<\/p>\n

ABC Holdings Sdn. Bhd. \u2014 100%<\/strong><\/p>\n

and ABC Holdings has annual revenue of RM8 million<\/strong>?<\/p>\n

This is where we need to look a little closer.<\/p>\n

The HASiL Guideline also takes into account situations where a taxpayer has a non-individual shareholder<\/strong> with annual turnover or revenue of at least RM3 million.<\/p>\n

In simple terms: Don\u2019t just look at how much your company earns. Look at who owns the company as well.<\/p>\n

3. Is Your Company a Subsidiary?<\/strong><\/p>\n

As a business grows, its corporate structure often grows with it. Perhaps when you first started, the structure was simply:<\/p>\n

Ali<\/strong>
\u2193
ABC Trading Sdn. Bhd.<\/strong><\/p>\n

A few years later, the business expands and the group is reorganised into something like this:<\/p>\n

ABC Holdings Sdn. Bhd.<\/strong>
\u2193
ABC Trading Sdn. Bhd.<\/strong>
\u2193
ABC Manufacturing Sdn. Bhd.<\/strong><\/p>\n

There is nothing unusual about this in the corporate world.<\/p>\n

However, this also means that each company may not necessarily be considered entirely in isolation when determining eligibility for the e-Invoice exemption.<\/p>\n

For example:<\/p>\n

ABC Trading Sdn. Bhd.<\/strong>
Revenue: RM700,000<\/p>\n

ABC Holdings Sdn. Bhd.<\/strong>
Revenue: RM6 million<\/p>\n

Although ABC Trading itself has revenue below RM3 million, its position needs to be reviewed because it is a subsidiary of a holding company<\/strong> with annual turnover or revenue of at least RM3 million.<\/p>\n

So if your company has a holding company, check the overall structure before determining its exemption status.<\/strong><\/p>\n

4. Do You Have a Related Company or Joint Venture?<\/strong><\/p>\n

This is another important consideration, particularly for entrepreneurs who own or operate several companies.<\/p>\n

For example, you may have:<\/p>\n

Company A<\/strong> \u2014 Trading
Company B<\/strong> \u2014 Manufacturing
Company C<\/strong> \u2014 Property<\/p>\n

Or perhaps your business is involved in a joint venture (JV)<\/strong> with another business partner.<\/p>\n

If one of these entities has annual turnover or revenue of RM3 million or more, you should not automatically determine the e-Invoice status of the other companies based solely on their respective revenue figures.<\/p>\n

The HASiL Guideline also contains criteria relating to related companies and joint ventures<\/strong>.<\/p>\n

In its e-Invoice FAQ, HASiL provides examples where companies with a common corporate shareholder<\/strong> may be regarded as related companies where direct or indirect control exists.<\/p>\n

So, if your business structure involves several corporate entities, it may be necessary to look at the bigger picture.<\/p>\n

\u201cI Own Two Companies Personally. What Happens Then?\u201d<\/h5>\n

This is a good question.<\/p>\n

For example:<\/p>\n

Mr Ali<\/strong> owns 100% of:<\/p>\n

ABC Trading Sdn. Bhd.<\/strong><\/p>\n

and at the same time owns 100% of:<\/p>\n

XYZ Services Sdn. Bhd.<\/strong><\/p>\n

Are the two companies automatically regarded as related companies simply because they have the same individual shareholder?<\/p>\n

Based on an example provided by HASiL in its e-Invoice FAQ, having a common individual shareholder alone does not cause the two companies to be regarded as related companies for this particular purpose.<\/strong><\/p>\n

This is an important distinction.<\/p>\n

That is why we do not encourage business owners to make conclusions simply because:<\/p>\n

\u201cI own several companies.\u201d<\/strong><\/p>\n

Owning several companies does not necessarily mean that all of them automatically lose their exemption.<\/p>\n

What matters is how those companies are owned and controlled.<\/strong><\/p>\n

So, Who May Qualify for the Exemption?<\/h5>\n

Here are a few simplified examples:<\/p>\n\n\n\n\n\n\n\n\n\n
Situation<\/th>\nWhat You Should Know<\/th>\n<\/tr>\n
Revenue RM800,000 and all shareholders are individuals<\/td>\n\u2705 Potentially eligible for the exemption<\/td>\n<\/tr>\n
Revenue RM1.5 million and all shareholders are individuals<\/td>\n\u2705 Potentially eligible for the exemption<\/td>\n<\/tr>\n
Revenue RM500,000 but the shareholder is a company with revenue exceeding RM3 million<\/td>\n\ud83d\udd0e Further review required<\/td>\n<\/tr>\n
Revenue RM900,000 but the company is a subsidiary of a holding company with revenue exceeding RM3 million<\/td>\n\ud83d\udd0e Further review required<\/td>\n<\/tr>\n
Revenue below RM3 million but there is a related company\/JV with revenue of at least RM3 million<\/td>\n\ud83d\udd0e Further review required<\/td>\n<\/tr>\n
Revenue RM3 million or above<\/td>\nNot covered by the below-RM3-million exemption<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

Important:<\/strong> The table above has been simplified for general understanding and should not be treated as a final determination of any particular taxpayer\u2019s e-Invoice status.<\/p>\n

What If You Have Just Incorporated a New Sdn. Bhd.?<\/h5>\n

This is particularly relevant to many MSIB clients. Let\u2019s say you have just incorporated a Sdn. Bhd. in 2026.<\/p>\n

The business is new.<\/p>\n

You may not even have generated any sales yet. Does that mean the company is automatically exempted?<\/p>\n

For businesses commencing operations from YA2026 onwards, HASiL has provided specific rules for determining when e-Invoice implementation begins.<\/p>\n

One important point to understand is:<\/p>\n

The date your company is incorporated and the date it commences business operations are not necessarily the same.<\/em><\/strong><\/p>\n

For example, you may incorporate your company in January but only commence actual business operations in March. Therefore, for a newly incorporated company, we should not look at the incorporation date alone.<\/p>\n

We also need to consider when business operations commenced, the relevant turnover or revenue, and whether the company satisfies the applicable exemption criteria.<\/strong><\/p>\n

If My Company Is Exempted, Can I Forget About e-Invoice Completely?<\/h5>\n

Not quite.<\/p>\n

This is another point we want business owners to understand.<\/p>\n

Being exempted from implementing e-Invoice does not mean e-Invoice will have nothing to do with your business.<\/strong><\/p>\n

Your suppliers or vendors may already be required to implement e-Invoice.<\/p>\n

When you purchase goods or obtain services from them, you may therefore still receive e-Invoices for those transactions. So even if your company qualifies for the exemption, we still encourage business owners to understand at least the basics of the e-Invoice system.<\/p>\n

Your business may be generating RM500,000 in revenue today.<\/p>\n

But who knows?<\/p>\n

A few years from now, it could be RM3 million, RM5 million or even RM10 million. That\u2019s the kind of problem every business owner would like to have, right?<\/strong><\/p>\n

What Does MSIB Recommend You Do Now?<\/h5>\n

If your business has annual sales or revenue below RM3 million, first of all:<\/p>\n

THIS IS GOOD NEWS!<\/strong><\/p>\n

There is no need to make this change more complicated than it needs to be. Before determining that your company qualifies for the exemption, however, carry out these four simple checks:<\/p>\n

\u2460 <\/span>Check your company\u2019s annual turnover or revenue
\u2461<\/span> Check who the shareholders of the company are
\u2462<\/span> Check whether the company has a holding company or is a subsidiary
\u2463<\/span> Check whether there are any related companies or joint ventures<\/p>\n

For many SMEs with a simple corporate structure, this assessment may be relatively straightforward.<\/p>\n

However, if you operate several Sdn. Bhd. companies or your structure involves corporate shareholders, holding companies, subsidiaries or joint ventures, it may be worthwhile carrying out a more detailed review.<\/p>\n

A Final Word from Us<\/h5>\n

At MSIB, we see the increase of the e-Invoice exemption threshold to RM3 million<\/strong> as a positive development for Malaysia\u2019s SME community. It gives smaller businesses more room to focus on running and growing their businesses.<\/p>\n

At the same time, as business owners and company directors, it is important that we understand the conditions that come with an exemption.<\/strong><\/p>\n

Not because we want to make compliance complicated.<\/p>\n

Quite the opposite.<\/p>\n

We believe compliance becomes much easier when business owners understand what needs to be done from the beginning.<\/strong><\/p>\n

So, if your company\u2019s sales are below RM3 million, you may have some good news.<\/p>\n

Carry out the four checks above, understand where your company stands, and then get back to focusing on growing your business.<\/strong><\/p>\n

Hopefully, one day your question will no longer be:<\/p>\n

\u201cMy company is below RM3 million. Am I exempted from e-Invoice?\u201d<\/strong><\/p>\n

Instead, it will be:<\/p>\n

\u201cOur sales have exceeded RM3 million. What does the company need to do next?\u201d<\/strong><\/p>\n

And when that day comes, congratulations.<\/p>\n

Your business is growing.

<\/strong><\/p>\n

<\/div>\n
MSIB \u2014 Where Business Meets Compliance<\/h5>\n

We help entrepreneurs and business owners manage their corporate requirements through company incorporation, company secretarial, accounting, tax and audit coordination services<\/strong>, allowing you to spend more time on what matters most \u2014 building and growing your business.<\/strong><\/p>\n

This article has been prepared by MSIB for general educational and informational purposes based on the e-Invoice information and guidelines issued by HASiL and available as at the date of publication. It does not constitute specific tax advice or a definitive determination of any taxpayer\u2019s e-Invoice eligibility. Each business should be assessed based on its own circumstances, corporate structure and the applicable HASiL guidelines in force at the relevant time.<\/em><\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t

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Good news for Malaysian SMEs! Businesses with annual turnover or revenue below RM3 million may now qualify for e-Invoice exemption. However, there are several important eligibility criteria business owners should understand. MSIB explains what you need to know in simple terms.<\/p>\n","protected":false},"author":1,"featured_media":1533,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"default","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","ast-disable-related-posts":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"default","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"ast-content-background-meta":{"desktop":{"background-color":"var(--ast-global-color-4)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"var(--ast-global-color-4)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"var(--ast-global-color-4)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"footnotes":""},"categories":[34],"tags":[22,23,24,25,26,27,28,29,30,31,32,33,35],"class_list":["post-1484","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-tax","tag-e-invoice-exemption-below-rm3-million","tag-e-invoice-exemption-criteria","tag-e-invoice-exemption-for-smes","tag-e-invoice-exemption-malaysia","tag-e-invoice-for-new-companies","tag-e-invoice-for-sdn-bhd","tag-e-invoice-malaysia-2026","tag-e-invoice-requirements-malaysia","tag-e-invoice-threshold-malaysia","tag-hasil-e-invoice","tag-lhdn-e-invoice","tag-rm3-million-e-invoice-threshold","tag-who-is-exempted-from-e-invoice-malaysia"],"_links":{"self":[{"href":"https:\/\/companysecretary.my\/bm\/wp-json\/wp\/v2\/posts\/1484","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/companysecretary.my\/bm\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/companysecretary.my\/bm\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/companysecretary.my\/bm\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/companysecretary.my\/bm\/wp-json\/wp\/v2\/comments?post=1484"}],"version-history":[{"count":0,"href":"https:\/\/companysecretary.my\/bm\/wp-json\/wp\/v2\/posts\/1484\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/companysecretary.my\/bm\/wp-json\/wp\/v2\/media\/1533"}],"wp:attachment":[{"href":"https:\/\/companysecretary.my\/bm\/wp-json\/wp\/v2\/media?parent=1484"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/companysecretary.my\/bm\/wp-json\/wp\/v2\/categories?post=1484"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/companysecretary.my\/bm\/wp-json\/wp\/v2\/tags?post=1484"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}