Key Areas to look out for that SME must be in compliance via Self Billing
1. Payment in relation to capital reduction, share / capital / unit redemption, share buyback, return of capital or liquidation proceeds
There are situation on approval needed and no approval needed from the government
2. E-Invoice Compliance
Self-billed invoices must be reported to LHDN in within the required timeframe.
Ensure invoices follow LHDN’s e-invoicing format
3. Supplier Agreement and SST Compliance
Suppliers must not issue their own invoices if self-billing applies on buyer side.
Which Business Areas Are Affected?
1. Procurement & Accounts Payable
Businesses using self-billing need to generate invoices on behalf of suppliers.
They must ensure supplier data is accurate to avoid tax issues or errors in submitting e-Invoice.
2. Tax & Compliance
Self-billing errors can lead to non-compliance with LHDN should the error resulted in late submission of e-Invoice. You may need to refer to your Tax Agents to verify that input tax claims are valid and justified.
Example 1: Manufacturer Engaging Local Raw Material Suppliers
Issue
A factory purchases raw materials from small suppliers who don’t have structured invoicing systems. To streamline payments, they implement self-billing for these suppliers.
Plan & Solution
In this case the local suppliers should issue e-Invoice/ normal issue depends on their phase.
Example 2: Logistics Company Hiring Freelance Drivers
Logistics Company should get Invoice/ receipts from the Freelance Drivers.
How InTune Outsourcing Can Support SME Business Owners?
InTune Outsourcing is one of the Malaysia’s Most Advanced and Top Outsourced Accounting, Finance, HR and Payroll services providers.
We have served more than 400 clients todate and InTune offer full-range services from start up to small to medium-sized companies.
InTune takes away the stress and pains from managing Accounting, Finance, Payroll and HR, including Bookkeeping, Payment Services, Accounts Payable, Accounts Receivable, Payroll and more, by providing an expert team of CPAs and other accounting professionals who understand the special accounting needs of growing businesses.