KUALA LUMPUR: More than 268,000 taxpayers have submitted 1.99 billion e-invoices as of Oct 1, 2026, according to the Inland Revenue Board, which is bringing businesses into the system in stages. The board, known as LHDN, said 196,031 of those taxpayers filed under phase four of the e-invoicing rollout. The figures were released as the government eased the burden on smaller operators by raising the exemption threshold.
LHDN chief executive officer Datuk Dr Abu Tariq Jamaluddin gave the numbers to reporters after launching the Bulan HASiL 2026 programme. He said the staged approach gives businesses time to adjust their accounting and reporting systems. The programme carries the theme Voluntary Disclosure, Shared Responsibility, which frames compliance as a shared task between the authority and taxpayers.
The government recently announced an increase in the e-invoice exemption threshold from RM1 million to RM3 million. Micro, small and medium enterprises with annual turnover below RM3 million are no longer required to implement e-invoicing. The new threshold took effect on Sept 1, 2026. The change gives smaller operators more time to prepare their systems and processes before they are brought into the regime.
A rollout carried out in four phases
E-invoicing has been introduced in stages, starting with the largest taxpayers and widening over time. Each phase brings a new group of businesses into the reporting framework. The fourth phase accounts for the largest number of participants so far, reflecting the broader pool of businesses now covered by the system.
- Phase one involved 5,582 taxpayers
- Phase two involved 14,579 taxpayers
- Phase three involved 51,815 taxpayers
- Phase four accounted for 196,031 taxpayers
As of Aug 31, 2026, LHDN had more than 620,000 active company tax files and more than 7.6 million active individual tax files. The figures give a sense of the scale of the taxpayer base that the board is bringing into the e-invoicing system. The staged approach allows LHDN to manage the transition without overloading the businesses involved.
Higher exemption threshold eases pressure on MSMEs
With the new threshold, micro, small and medium enterprises with annual turnover below RM3 million are no longer required to implement e-invoicing. The measure took effect on Sept 1, 2026. For many small operators, the change removes an immediate compliance cost while leaving the option to adopt the system voluntarily.
The implementation of e-invoicing is being carried out in stages, with the government recently announcing an increase in the exemption threshold from RM1 million to RM3 million.
E-invoicing works by validating invoice data with the tax authority at the point of issuance, rather than only when a return is filed at the end of a reporting period. Businesses within the scope of the mandate must transmit invoice details through an approved channel. The higher threshold means smaller operators can defer investment in the supporting systems for now.
Voluntary disclosure and Bulan HASiL 2026
LHDN introduced several special initiatives under the Bulan HASiL 2026 programme. These include a special voluntary disclosure programme covering e-invoicing and stamp duty, along with a voluntary income tax disclosure campaign. The programme gives taxpayers a route to put their affairs in order while the board steps up enforcement elsewhere.
- PKPS e-Invois focuses on e-invoicing compliance
- PKPS Duti Setem allows taxpayers to regularise stamp duty matters without penalties
- A voluntary income tax disclosure campaign runs alongside both programmes
- A tax knowledge tour is being held nationwide in October 2026
The tax knowledge tour is one of the highlights of Bulan HASiL 2026 and is being held nationwide during October 2026. The theme of the programme, Voluntary Disclosure, Shared Responsibility, reflects the board's push for taxpayers to take responsibility for their own compliance. The voluntary disclosure route is intended to make it easier for taxpayers to correct their records before other action is taken.
Its chief executive officer Datuk Dr Abu Tariq Jamaluddin said 196,031 taxpayers accounted for submissions under phase four of the e-invoicing rollout.
What it means for Malaysia's cloud and data centre market
For cloud providers and data centre operators in Malaysia, the e-invoicing mandate is a driver of demand for software and integration work. Businesses within scope need to transmit invoice data to the tax authority through approved channels, which usually means connecting their accounting platforms to external services. That work supports hosting, integration and managed services around the country.
The higher threshold also changes the shape of that demand. Smaller businesses may postpone full implementation, while larger taxpayers continue to invest in systems and compliance controls. Providers offering packaged e-invoicing integration for mid-sized firms are likely to find a receptive market as the remaining phases proceed.
LHDN said it will continue to monitor compliance as the rollout progresses. For businesses below the threshold, the reprieve offers breathing room, but e-invoicing remains the direction of travel for tax administration in Malaysia, and operators should plan for it rather than wait for the next deadline.
Source: Bernama
