In Malaysia, e-invoicing is a convenient digital payment method used to request payment for goods or services. It is organized in a standardized electronic format, allowing accounting systems to process it automatically. E-invoicing in Malaysia complies with the regulations set by the LHDN (Lembaga Hasil Dalam Negeri). It is part of the government’s push for digital transformation and increased efficiency in the business sector. These invoices are sent electronically between contractors, eliminating the need for paper-based documentation and making the process more convenient for all parties involved. company formation in Malaysia
Critical features of e-invoicing in Malaysia:
- Digital Format: E-invoices are generated in a structured digital format such as XML or UBL, making them easily integrated into accounting and ERP systems. For more info, please visit https://gosenang.com/
- LHDN compliance: E-invoices comply with Malaysian tax laws, including SST (Sales and Services Tax), to ensure compliance and accuracy in tax reporting
- Secure shipping: E-invoices are delivered via secure, confidential channels, protecting sensitive data and reducing the risk of fraud.
- 4. Automation: Structured systems enable data entry automation, reducing manual effort and processing errors, thereby increasing productivity and efficiency.
Each company establishes the design of its invoices. Still, all must have certain mandatory information to comply with the standards of the tax agency that governs the area where they are located. In this sense, the invoice functions as a commercial document that proves that a transaction was carried out satisfactorily and has legal and fiscal validity for both parties involved.
Importance of invoices in commercial transactions
Companies must issue invoices when carrying out any commercial transaction, while customers have the right and duty to demand such a document. This is mainly to protect the legal rights of both parties.
As a business, issuing a complete invoice for every transaction you make allows you to keep track of the money you receive (and the money you spend if you take into account supplier invoices). In addition, invoices are essential for your business’s accounting.
On the other hand, keeping a record of all invoices issued is essential for paying the taxes established in the laws of each region, especially if you are entitled to receive a deduction for the VAT included.
Mandatory elements of an invoice
As mentioned above, an invoice offers legal protection to merchants and customers in a dispute between the parties. However, this is only true if the document contains all the required information to be considered valid before the competent authorities.
Below, we will tell you which elements cannot be missing from your invoice, regardless of its type:
- Number: Every invoice must have a number that identifies it and allows tracking of the products or services sold if necessary.
- Invoice Issued: Indicates the date on which the invoice was issued.
- Operation or accrual refers to the date the invoice was paid if it differs from the issue date.
- Tax information: requires the tax information of both parties, that is, the company providing the service and the client receiving it.
- Concept: Here, you place a list with a brief description of the traded products and their respective prices.
- Tax base: the total price of all goods or services before adding taxes.
- The tax rate applied refers to the taxes that must be added as applicable for each country.
- Total amount: the total price of the products once taxes and withholdings are considered according to current laws.
Whether it’s an online invoice or a paper invoice, the document must include this information to be valid. If you want to avoid legal problems, make sure that the format of your invoices includes all of this information.…
Ordinary invoice: This is the most common invoice and presents detailed information about a commercial transaction.
