THE Inland Income Board (IRB) is working extraordinarily laborious to make sure that firms with annual turnover exceeding RM100 million will be capable of adjust to the e-invoicing necessities from Aug 1.
There’s an earnest want on the a part of IRB to assist these taxpayers by means of the issuance of tips, steadily requested questions, participation in quite a few occasions and the willingness to answer to as many questions as potential posed by taxpayers.
Underlying rules
The primary day of August is approaching quickly, and companies in every trade have their very own issues; solutions supplied generally paperwork issued by IRB are usually not “one measurement suits all”.
To make sure compliance with IRB’s e-invoicing necessities, the very first thing you must ask is: “Is an e-invoice required for the transaction?”.
For many instances, an e-invoice is required if there’s a transaction involving sale of products or provision of providers (together with curiosity funds, rental funds or royalty funds). Nonetheless, there are transactions the place e-invoicing isn’t required (e.g. refundable deposits) or transactions particularly exempted by IRB (e.g. employment revenue, pensions, distribution of dividends in particular circumstances, transactions in listed securities, and disposal of unlisted shares by people).
Many associated social gathering transactions are at the moment documented by means of journal entries which must be reviewed and documented by means of the e-invoice paperwork.
The method
There are two components to implementing e-invoicing: Mapping your enterprise processes (frontend) and upgrading or customising your software program to hook up with the MyInvois portal (backend).
The frontend is equally essential because the backend. In the midst of mapping the enterprise processes, you’ll need to observe the foundations set out within the e-invoicing tips – comparable to reviewing your employment coverage which permits documentation concessions on workers claims by your workers, figuring out suppliers the place the funds are topic to self-billed e-invoices, reviewing your inside working procedures on onboarding your suppliers and clients to make sure that you’ll be able to receive the mandatory info for the issuance of e-invoice, and creating an motion plan to assemble info for the obligatory knowledge fields.
An essential course of can be to grasp the provision chain and the transactions undertaken by the corporate to determine the varieties of e-invoice paperwork to be issued to IRB (i.e. commonplace e-invoice, consolidated e-invoice, self-billed e-invoice, and so forth.) primarily based on the rules issued by the Board. If there are any gaps or shortfalls which aren’t addressed within the tips, this needs to be resolved with IRB.
The place is the additional assist from IRB?
Along with the paperwork issued and occasions that IRB is collaborating in, there are different avenues so that you can direct your inquiries to it – comparable to by means of buyer suggestions type, dwell chat helpdesk, or a 24-hour phone helpdesk. The tax authority is able to reply your questions and the 24-hour telephone helpdesk is working.
When you will have distinctive transactions, IRB is prepared to hearken to the way in which during which you’re recording the transactions and try to allow you to accommodate these transactions into the e-invoicing system. Every trade could have distinctive necessities and IRB is prepared to pay attention and supply options.
With all the help obtainable from IRB, you can’t anticipate any extension or postponement of the Aug 1 implementation deadline. In case you are unable to implement e-invoicing by then, you possibly can nonetheless problem regular invoices, however you continue to have to convert all invoices into e-invoices inside August, in any other case you would be penalised for non-compliance. Please take this critically.
This text is contributed by Thannees Tax Consulting Providers Sdn Bhd managing director SM Thanneermalai (www.thannees.com).