(Implementation Date Remains the Same — Only the Grace Period Is Extended)

Following the latest announcement by LHDN, many businesses mistakenly assume that the extension or “relaxation” means e-Invoice is no longer required.

👉 This is incorrect.

Let’s clarify the key points first:

• ✅ e-Invoice implementation still starts on 1 January 2026
  
  

• ✅ The penalty-free transition period has been extended until 1 January 2027
  
  

• ✅ 2026 is a “practice year”, not a year where e-Invoice can be ignored
  
  

When Is Your Company Required to Implement e-Invoice?

e-Invoice implementation is determined by two key factors:

1. Your company’s operation year, and
   
   

2. Your annual sales turnover
   
   

Below is the current applicable framework.

1. Companies That Started Operations in 2022 or Earlier

⚠️ If your company changed its financial year in 2022, annual sales must be adjusted to a 12-month basis.

Scenario A

Annual sales in 2022 exceeded RM1,000,000 (RM1 million)
➡️ Mandatory implementation from 1 January 2026

Scenario B

Annual sales did not exceed RM1,000,000 for every year from 2022 to 2025
➡️ Temporarily exempted

 2. Companies That Started Operations Between 2023 and 2025

Scenario A

Annual sales exceeded RM1,000,000 in any year between 2023 and 2025
➡️ Implementation starts from 1 July 2026

Scenario B

Annual sales did not exceed RM1,000,000 in all those years
➡️ Temporarily exempted

 Key Highlights of the 2026 Relaxation Period 

LHDN has officially introduced several measures in 2026 to ease implementation and allow businesses sufficient time to adjust.

1️⃣ e-Invoice Phase 4 (RM1 million – RM5 million turnover)

• Original penalty-free period: 6 months
  
  

• ✅ Extended to 12 months (no penalties)
  
  

2️⃣ Flexibilities Allowed During 2026

Throughout 2026, businesses are allowed to:

• Issue Consolidated e-Invoices
  
  

• Consolidate Self-Billed e-Invoices
  
  

• Use simplified descriptions such as “Monthly Sales”
  
  

The objective is to allow businesses to stabilise their systems and workflows before full enforcement.

3️⃣ Special Industry Rule: Building Materials & Hardware Suppliers

• Single invoice above RM10,000
  ➝ Must issue an individual e-Invoice
  
  

• Other transactions
  ➝ Allowed to issue Consolidated e-Invoices
  
  

 What Does This Announcement Really Mean?

This announcement does not mean e-Invoice is optional.

Instead, it means:
👉 Businesses are given additional time to prepare, refine processes, and ensure compliance.

Smart business owners are not looking for ways to avoid e-Invoice —
they use the 2026 transition period to organise systems, accounting processes, and internal controls properly, avoiding future penalties or audit risks.