What LHDN expects each month — transcript

Play this as a presentation — one slide per step, with the same narration. Every word of every step is on this page.

This lesson is for you if you run the books at GadgetSphere and the first week of every month is yours. In about eight minutes you will be able to say what the Inland Revenue Board, LHDN, expects to have validated by the 7th, what a consolidated e-invoice is, which of last month’s sales are inside one and which are not, and what becomes of a receipt that gets left behind. There is nothing to click yet; this is the map you need before the next four lessons.

Step 1 — Recognise what an e-invoice is

An e-invoice is the tax record of a sale, in the form the Inland Revenue Board of Malaysia, LHDN, asks for. Instead of a paper or PDF invoice being the record, a structured digital document goes to LHDN’s MyInvois system, where LHDN checks it and answers Valid or Invalid. Your customer may still receive a PDF that looks as it always did, but the version LHDN holds is the one that matters, and it only exists once LHDN has said Valid. That changes three habits. An invoice is not finished when you print it; it is finished when LHDN validates it. The data has to be right before it goes, because the correction path afterwards is narrow and time-limited. And someone has to check, every month, that everything got there. In BigLedger the sending is done for you: you authorised BigLedger once as your intermediary on the MyInvois portal, and your documents go straight from BigLedger to LHDN.

Reference: What Malaysia Requires: E-Invoicing Explained — What e-invoicing is

Step 2 — Name the deadline

After this step you can say the one date the whole cycle turns on. Almost everything GadgetSphere sold to walk-in shoppers last month is reported to LHDN inside consolidated e-invoices, and those must be validated by the 7th of the following month. The exceptions are Step 5. Notice the word: validated, not sent. Do not plan to send on the 7th: validation has to finish by then, not start. That is why BigLedger runs the consolidation and submission for your company on a scheduled day a few days before the 7th, leaving room to fix whatever comes back Invalid. The day is set per company. If you do not know yours, ask support before the 1st, not on the 6th. So your working window is the 1st to the 7th: budget about two hours on the 1st or 2nd, then a few short check-ins until the list is clean.

Reference: The Month-End E-Invoice Cycle (1st to 7th) — Before you start

Step 3 — Describe a consolidated e-invoice

After this step you can explain a consolidated e-invoice in one breath. It is one e-invoice that reports many small sales at once. Instead of sending LHDN a separate e-invoice for every till receipt, you send a single document covering a month of them, with the buyer recorded as General Public rather than a named person. It is a tax document in its own right, validated by LHDN like any other, not a summary or a report. And the receipts inside it stay traceable: each one is linked back to the consolidated e-invoice that reported it, so you can always answer which e-invoice reported this sale. The scale is the point. GadgetSphere’s 22 branches ring up roughly 38,000 receipts a month. Reported one by one, that is 38,000 buyer identities to collect and 38,000 chances to get one wrong. Consolidated, it is a small set of documents a person can actually check before the 7th.

Reference: Consolidated e-invoices — How it behaves in BigLedger

Step 4 — Pick out the sales that are consolidated

After this step you can look at a GadgetSphere sale and say whether it will be consolidated. The shape is simple: a walk-in sale under RM 10,000 where the buyer did not give their details. At the counter these are point-of-sale cash bills, and during setup they were given the submission type Consolidated, which you can see on the document’s E-Invoice tab. The moment one is finalised, BigLedger drops it into the Batch Pool, where it waits for the monthly run. Nothing is consolidated at the moment of sale. A shopper paying RM 189 for wireless earbuds, RM 2,400 for a tablet or RM 4,999 for a laptop goes the same way, at every one of the 22 branches. Almost all of GadgetSphere’s 38,000 monthly receipts are this shape, and that is exactly what the Batch Pool is for. A Batch Pool full of receipts is a healthy retailer.

Reference: E-Invoice Pools & Submission Routing — Submission types

Step 5 — Pick out the sales that go out on their own

After this step you can name the exceptions. First, size. A sales invoice or cash bill of RM 10,000 or more must be reported individually, with the buyer’s real tax identification number, their TIN. The line is inclusive, so RM 10,000 exactly is over it, and BigLedger diverts these away from the Batch Pool for you. Last month GadgetSphere had 112 of them, one a RM 24,600 laptop fleet order. Second, foreign buyers. A tourist paying on a passport can never sit inside a consolidated e-invoice; that sale is keyed with identity type Passport and goes out on its own. Third, choice. A shopper who asks for their own e-invoice gets one, as long as you pull the receipt out before the run. One catch: the divert covers sales invoices and cash bills only. A credit note, debit note, refund note or return of RM 10,000 or more marked Consolidated is not diverted, so check those yourself.

Reference: E-Invoice Pools & Submission Routing — The RM 10,000 rule

Step 6 — Know where a sale waits

After this step you can tell a pool that empties itself from one that waits for you. Between finalising and LHDN, a document that cannot be sent yet sits in one of three pools. The Batch Pool holds receipts waiting to be consolidated; if you do nothing, the monthly run sweeps them up. The Individual Pool holds documents meant to go out on their own that are missing something mandatory, usually the buyer’s TIN, identity type or address. If you do nothing, nothing happens; it waits for you indefinitely. The Single General Pool is the same shape: documents given one individual attempt before falling back to consolidation, and they wait too. Only the Batch Pool empties itself. There is no ageing alert, so nothing tells you a RM 24,600 invoice has sat in the Individual Pool since March. That is why the first job of every cycle is to open those two pools and look.

Reference: My E-Invoice Admin Applet — 3. Pools — what the buttons do

Step 7 — Understand what a late receipt costs you

After this step you know what happens, inside BigLedger, to a sale that misses its month. Two things, and neither comes with a warning. A receipt still unprocessed in the Batch Pool after the run is not skipped: the next run takes every unprocessed row, whatever its date, and dates anything older than the current month to the last day of the previous month. Right while that is still its month; wrong once the calendar has moved on, because the sale is now reported under the wrong period. A document left in the Individual Pool is simpler and worse: it stays unreported until someone acts, and the next person to notice may be whoever reconciles months later. One thing the 7th is not: it has nothing to do with the 72 hours. Seventy-two hours, counted from validation, is the window for cancelling a validated e-invoice. It is not a submission deadline.

Reference: E-Invoice Pools & Submission Routing — Backdated documents

Step 8 — Know what the rules require, as opposed to what BigLedger does

Everything so far has been BigLedger. This step is the rule book. LHDN’s Specific Guideline gives you seven calendar days after a month ends to submit a consolidated e-invoice. An individual e-invoice gets no window of its own: in the guideline’s retail examples it is generated at the point of purchase, when the buyer asks; no separate deadline is written down. Not issuing a required e-invoice is non-compliance LHDN can prosecute under section one hundred and twenty of the Income Tax Act; the guideline says so by suspending that prosecution during a relaxation period, running to the end of twenty twenty-seven for turnover up to five million ringgit and already over for larger taxpayers. The fine is set by the Act, so this course does not quote it. Those are LHDN’s rules, not BigLedger behaviours, checked against Specific Guideline version four point nine of seven September twenty twenty-six; the page recording that version shows whether LHDN has moved on.

Reference: Which LHDN Guideline Version This Wiki Cites — The rules this wiki states, and where each one sits

Check yourself

Three to five questions on what you just heard. Every correct answer links to the page that makes it correct, so you can check the source, not just the mark.

Next: Consolidate the cash bills · Back to the series · Play this as a presentation