Phase 3 Of e-Invoicing Delayed To 2026

The Ministry of Finance has released a recent update to their phase 3 e-invoicing plans. SMEs and micro SMEs may breathe a sigh of relief for now as it has been decided to delay the implementation of the third phase of e-invoicing by six months. Phase 3 will now begin on 1 January 2026, instead of the previous 1 July 2025.

The postponement is well received by businesses and industry players in general. The extra six months allows MSMEs more time to better allocate resources and realign their strategies, improve training, and adapt their organisations to fit the new system.

Phase 3 of the e-invoicing implementation would have involved all types of businesses, including MSMEs. The first phase began on 1 August 2024, but only for companies with annual sales that exceed RM100 million.

The second phase began on 1 January 2025. This phase involved e-invoicing for companies with annual sales between RM25 million and RM100 million.

The government has allowed an exemption of the e-invoice issuance to small businesses with annual sales below RM150,000. Finance Minister II Datuk Seri Amir Hamzah Azizan said this will benefit over 700,000 small traders as they no longer need to issue e-invoices.

In order to continue supporting MSMEs with e-invoicing implementation, the next phase will be postponed for MSMEs with annual sales between RM150,000 and RM500,000 to 1 January next year.

Overall, this new period of flexibility is expected to give sufficient time for taxpayers to ensure the implementation of e-Invoicing smoothly and fully.

Read More: Guide To e-Invoice In Malaysia