e-Invoice | TimeTec Parking

E-Invoicing Malaysia


(Guide to Car Parking Industry)
E-Invoicing has been integrated into Malaysia's tax system, transforming the way businesses operate in the country. Instead of relying on paper or electronic documents for invoices, credit notes, and debit notes, e-Invoicing with centralized Continuous Transaction Control (CTC) is becoming the norm, streamlining financial operations and increasing accuracy.
What is e-Invoice?

An e-Invoice is a digital representation of a transaction between a supplier and a buyer. E-Invoice replaces paper or electronic documents such as invoices, credit notes, debit notes and refunds.

It is a file created either in the Extensible Markup Language (XML) or JavaScript Object Notation (JSON) formats that can be automatically processed by relevant systems.

It is not invoice data in PDF or Word formats, or images of the invoice as JPG or TIFF, or HTML on a webpage.

Generally, an e-Invoice contains the same essential details as traditional invoices, including information about the supplier and buyer, item descriptions, quantities, pre-tax prices, tax amounts, and total costs. This data is used to monitor daily business transactions.
E-Invoicing Timeline

Targeted Taxpayers Implementation Date
Taxpayers with an annual turnover or revenue of more than RM100 million 1 August 2024
Taxpayers with an annual turnover or revenue of more than RM25 million and up to RM100 million 1 January 2025
All taxpayers 1 July 2025


The annual turnover is based on:-

  1. Taxpayers with audited financial statements: Use turnover from 2022 audited statements.
  2. Taxpayers without audited statements: Use revenue from 2022 tax return.
  3. If accounting year end changes in 2022, turnover is pro-rated for e-Invoice date.

Benefits of E-Invoicing for Business
  Streamlined Invoicing Process
Enhance your business's efficiency by integrating your invoicing procedures and process from end to end which reduce manual efforts and human errors. E-Invoices facilitate smooth transactions through streamlined document creation, submission, and automated data entry.

  Simplified Tax Reporting
Experience the benefits of a fully integrated system, ensuring accurate and efficient tax reporting with seamless operation for your business.
  Optimized Operation
E-Invoicing transforms operations, empowering large businesses with streamlined processes that drive efficiency, delivering significant time and cost savings.

  Real-Time Digital Financial Reporting
By adopting e-Invoicing in Malaysia, you can synchronize your financial reporting and processes with industry standards tailored for micro, small, and medium-sized enterprises (MSMEs).
E-Invoicing Submission Methods

a. MyInvois Portal
• A portal hosted by LHDN
• Login to MyInvois Portal and generate e-Invoice individually by completing the form
• For businesses without ERP systems

b. Direct Application Programming Interface (API) Integration
• Using API that is a set of programming code that enables direct data transmission between the TimeTec System and MyInvois system
• Login from TimeTec System via Access Token generated by API and generate e-Invoices and submission easily in TimeTec System
• Ideal for large taxpayers or businesses with substantial transaction volumes
Data fields required to issue an e-Invoice

There are 55 data fields (based on LHDN’s e-Invoice Guideline Appendix 1) required to issue an e-Invoice. These fields are grouped into eight (8) categories as below:

IRB Categories Example of Fields
1. Parties Supplier and buyer’s name.
2. Supplier’s Details Supplier’s Tax Identification Number (TIN), email address, 5-digit MSIC code, MSIC description, company registration number/ individual MyKad number/ passport, SST registration number.
3. Buyer’s Details Buyer’s TIN, email address, company registration number/ individual MyKad number/ passport, SST registration number.
4. Address Supplier and buyer’s address.
5. Contact Number Supplier and buyer’s contact number.
6. Invoice Details Including the e-Invoice version, e-Invoice type, e-Invoice code / number, issuer’s digital signature, e-Invoice date and time and etc.
7. Products/ Services Including the description, quantity, unit of measurement (UoM), unit price, discount rate, discount amount, tax type, tax rate, and tax amount and etc.
8. Payment Information Including payment mode, supplier bank account, payment terms and etc.
Individual e-Invoice

Upon the implementation of e-Invoice, especially B2B transactions, suppliers are supposed to issue e-Invoices which require the clearance from LHDN to all their buyers individually, which we called individual e-Invoice.
Consolidated e-Invoice

Normally applies to B2C transactions (e.g. retail and F&B) where e-Invoices are not required by the individual end consumers, then suppliers will be allowed to consolidate all transactions together in a single consolidated e-Invoice to submit to LHDN.
Self-Billed e-Invoice

There are certain circumstances where taxpayers would have to issue self-billed e-Invoice to document an expense such as foreign transactions. For example, if the taxpayer acquired goods and/or services from foreign supplier and received an invoice from the foreign supplier who does not use Malaysia’s MyInvois System, the taxpayer would be required to issue a self-billed e-Invoice to document the expense.

Hence, in the scenario above, the Buyer will assume the role of the Supplier to be the issuer of e-Invoice and submits it to LHDN for validation. Upon validation, Buyer would be able to use the validated e-Invoice as a proof of expense for tax purposes.
The Importance of Automated e-Invoicing Solution

1. Simplified Issuance of Self-Billed e-Invoices
Easily issue self-billed e-Invoices for various purposes such as commissions to agents, overseas purchases, e-commerce, dividends, taxes, or gaming payouts.

2. Seamless Reconciliation between LHDN and Your Accounts
Identify discrepancies between LHDN server and your system, making it easier than ever to reconcile the accounts.

3. Comprehensive Compliance Solution
Ensure tax compliance through efficient e-invoice issuance, insightful dashboards, role-based access, alert systems, and over 7 years of data archiving.

4. Penalty for Non-Compliance
According to the Income Tax Act 1967, business owners may face fines ranging from RM200 to RM20,000, or imprisonment for up to 6 months, or both for non-compliance!
How e-Invoicing Works

1. E-Invoice Creation
Suppliers create e-Invoices for sales, either automatically through TimeTec systems or manually at the MyInvois Portal.
   
2. E-Invoice Validation
LHDN validates e-Invoices in real-time to meet standards. Suppliers get a Unique Identifier Number and validation link for traceability.
   
3. Notification of Validated E-Invoice
LHDN notifies both supplier and buyer upon successful validation.
4. Sharing of E-Invoice
Suppliers send the validated e-Invoices to buyers which are embedded with a QR code for verification.
   
5. Review of e-Invoices
Suppliers and buyers review e-Invoices via MyInvois Portal.
   
6. Rejection or Cancellation of e-invoices
Buyers can request rejection, and suppliers can request cancellation, with valid justifications within 72 hours. Any subsequent adjustments will not be allowed to the e-invoice; the supplier and buyer would be required to issue a new e-invoice (e.g., credit note, debit note, or refund note e-invoice) to make an adjustment.
For TimeTec Parking Solution
TimeTec Parking Management System (PMS) is not an accounting system, but it helps Parking Operators manage casual, seasonal, valet, and other parking methods, and issue invoices or parking receipts for customers. Therefore, it must comply with LHDN’s e-Invoice Policy when issuing individual e-Invoices for season parking and furnishing adequate information, including all parking collections, to the backend accounting system of the Parking Operator. The Parking Operator must ensure that its accounting system complies with LHDN requirements.

TimeTec provides four options for Parking Operators to comply with the e-Invoice policy:

i. Exporting parking information and transactions in CSV format
The parking operator can download a CSV file from the PMS and import it into their accounting system. This process doesn't require programming skills but relies on the accounting system having an import feature. This solution is free of charge from TimeTec.

ii. Provide API for accounting system to retrieve parking information and transactions
The parking operator can use TimeTec PMS API to retrieve information and update it in their accounting system. This process requires your Accounting System developer to create and manage our API calls. TimeTec will provide PMS API free of charge to parking operator, but Accounting System provider may charge parking operator for integration fee.

iii. Integrating with the Parking Operator’s accounting system via API for real time activity
This involves a two-way integration, where the parking operator needs to provide the Accounting System API for TimeTec PMS integration and vice versa. TimeTec is required to work on the API integration with the accounting system, incurring additional costs charged by TimeTec and Accounting System provider respectively.

iv. Full set TimeTec PMS comes with TimeTec i-Account (e-Invoice Compliance)
This is the perfect solution for parking industry, TimeTec PMS (Parking Management System) seamlessly integrated with our TimeTec i-Account Accounting System that fully compliance with the e-Invoice requirement.

Note: The first option is the simplest and most cost-effective, as it comes with TimeTec PMS. For the second option, integration with the Parking Operator’s accounting system is required but in one-way communication. The third option is a two-way interaction solution for better automation and user experience. The second and third option integration may take up to a month or two, depending on the complexity of the accounting system and the readiness of the third party’s API. The fourth option is a total solution (Parking Management + Accounting) TimeTec can offer.
Potential E-Invoicing work flow for Parking Industry:
• For season parking customer

  1. Require to update customer information (e.g. Name, TIN, ID number, address, contact number and etc) via mobile app
  2. Can request E-invoice via mobile app
  3. Can view E-invoice via mobile app
  4. Can reject E-invoice via mobile app
  5. This requires close integration (option 3 & 4) with the accounting system.
• For casual parking customer
(including valet and event parker)

  1. As the parking operator uses consolidated e-Invoices, customers need to contact the operator for their e-Invoices
• For Parking Operator

  1. Parking operators are required to register as a Tax Payer.
  2. Provide API and integrate with backend accounting system.
  3. Operator is allowed to submit consolidated e-Invoices on a monthly basis to LHDN by the 7th day of the following month.
  4. However, the operator has to generate an e-Invoice for the specific parking customer that requires an individual e-Invoice and submited a request.
TimeTec Parking Options for the compliance of e-Invoice and Delivery Timeline:
Item OPTION 1
PMS linked		 OPTION 2
PMS linked 		OPTION 3
Accounting linked		 OPTION 4
i-Account linked
Method Provide CSV file TimeTec provides API TimeTec & ASP/Middleware (Peppol etc) provides APIs Fully Integrated System
Delivery date 1 July 2024 (Season) 1 Aug 2024 (Casual, Valet etc) 1 July 2024 (Season) 1 Aug 2024 (Casual, Valet etc) Unknown (depend on ASP/Middleware) 2Q 2025
Cost FOC FOC from TimeTec, Chargeable from ASP/Middleware Chargeable from both parties TimeTec i-Account subscription
Integration Timeline N/A Depend on ASP/Middleware Estimate 1 mth from TimeTec
+ Depend on ASP/Middleware 		N/A
TT development cost N/A N/A RM1K per man day (from TT) N/A
Pros
  1. Cost Effective
  2. If season parker requires e-Invoice, can generate almost instantly by TimeTec PMS
  3. Casual parker can download TimeTec app to retrieve e-Invoice
  1. Cost Effective
  2. Operator can automate the import of e-invoice direct from TimeTec PMS
  3. If season parker requires e-Invoice, can generate almost instantly by TimeTec PMS
  4. Casual parker can download TimeTec app to retrieve e-Invoice
  1. Seamless integration, TimeTec PMS as part of operator’s AS invoicing module, ease consolidation, CN & Refund process
  2. If season parker requires e-Invoice, can generate almost instantly by TimeTec PMS
  3. Casual parker can download TimeTec app to retrieve e-Invoice
 Same as Option 3
Cons
  1. Accounting system needs to import e-invoice CSV files from TimeTec PMS
  1. ASP/Middleware needs to integrate with TimeTec PMS and normally with a cost and time
  1. ASP/Middleware needs to provide API to integrate with TimeTec system and normally with a cost and time
  2. TimeTec needs to integrate with AS/Middleware and normally with a cost and time
  1. Subscription fee for TimeTec i-Account Software (RM500 per mth) that compliance to e-Invoicing.
FOC: Free of Charge, N/A: Not Applicable, ASP: Accounting Software Provider, AS: Accounting System, PMS: Parking Management System, API: Application Programming Interface

Disclaimer : Due to e-invoice is new, and government still constantly updating its guideline and SDK, the above options or content of the options may revise from time to time.
Frequently Asked Questions:
1. Prior to full implementation, there may be suppliers who do not issue e-Invoice as they have not reached the mandatory implementation phase/date. In this situation, will LHDN accept normal invoices issued by these suppliers?

During the transitional period, allowed to provide normal bill / receipt / invoice from suppliers who are not reached mandatory implementation until full implementation of e-Invoice.

2. Does the MyInvois Portal allow for e-Invoice to be created and stored in draft form prior to finalization and issuance?

Yes, the supplier will be able to create e-Invoice in draft or proforma. e-Invoice will only be accepted once the validation is successful.

3. To save cost and time, can I use my accounting system instead of TimeTec PMS to generate e-invoices for season parking customers if they require e-invoices?

Yes, you can. But since TimeTec PMS is e-invoice complied before 1 August 2024, and direct link to LHDN’s MyInvois Portal, you can make use of your TimeTec PMS to generate e-Invoice. And, the good news is, it’s FOC for TimeTec e-Invoice module.

4. How about casual parkers? Do I need to generate e-invoices for them?

If casual parkers require e-invoices to claim their parking expenses, then yes, operators must generate e-invoices for them, but they have to provide the required TIN info for e-Invoicing.

5. Can you explain how the e-invoice process works in such cases?

In general, different parking methods (e.g., cash, cashless, LPR, TnG Card, EMV card, unattended kiosk) may have different e-invoice processes, with varying levels of complexity. For TimeTec, customers can use the TimeTec Parking App or scan the QR code posted at the parking sites to fill out required information After an e-invoice is generated, they can obtain via our app or receive via email.

6. As a parking operator, how do I submit e-invoices for casual parking to LHDN?

For casual parking, you may submit a consolidated e-invoice once before the 7th day of each month for the previous month’s casual parking transactions. However, if individual casual parkers request an e-invoice to claim the parking fee from their company, you must generate individual e-invoices for them, and remember to deduct the individual e-invoices when submitting the consolidated e-invoice.

7. How about valet parking? How should I provide an e-invoice if a customer asks for it?

Almost the same process, operators can submit consolidated e-invoice. But if individual valet parkers request an e-invoice, operators have to comply.

8. Do businesses need to submit an e-Invoice within the same day the transaction is being made?

For parking industry, there is no specific requirement on the timing for individual season or casual parking e-Invoice issuance, except in consolidated e-Invoice for both casual and season parking, operators have to submit before 7th on every month.

9. Is there any adjustment allowed for the operators to cancel an invoice submitted to LHDN?

Yes, there is a limited 72-hour timeframe for the e-Invoice to be cancelled by the operators.

Any changes after 72 hours from time of validation would require the operators to issue a new e-Invoice (i.e., debit note, credit note, refund note e-Invoice) to adjust the original e-Invoice issued. Thereafter, a new e-Invoice would be required to be issued accordingly.

10. What is the timeframe to issue e-Invoice adjustments (i.e., debit note, credit note and refund note) after the 72-hours validation period?

There is no timeframe restriction for operators to issue e-Invoice adjustments. Taxpayers may follow their respective company policy for any e-Invoice adjustments.

11. Does the MyInvois Portal allow for editing of information after the e-Invoice has been verified by LHDN?

No, the supplier would need to cancel the e-Invoice within 72 hours from time of validation and reissue a new e-Invoice.

12. What are the consequences for failure to issue e-Invoice?

Failure to issue e-Invoice is an offence under Section 120 (1) (d) of Income Tax Act 1967, a fine of not less than RM200 – RM20,000 or imprisonment not more than 6 months or both, for each not compliance.

We extracted the clause 7.1 to 7.6 from the LHDN e-Invoice Specific Guideline version 2.1, published on April 6, 2024, in relation to parking fee claims by employees, which is a concern of the parking industry:


CERTAIN EXPENSES INCURRED BY EMPLOYEE ON BEHALF OF THE EMPLOYER

7.1 An individual under a contract of service (i.e., employment) may incur certain expenses on behalf of the employer. Such expenses include, but not limited to, accommodation, toll, mileage, parking, telecommunication expenses, expenses incurred in a foreign country.

7.2 Currently, employees are required to submit their expense claims to their employers by proving the authenticity of such expense with supporting documents (e.g., bills, receipts, invoices, statements, payment slips, etc.).

7.3 Upon implementation of e-Invoice, when a sale or transaction is concluded, employees are required to request for the e-Invoices to be issued to their employer for proof of expense, to the extent possible.

7.4 However, LHDN acknowledges that there may be difficulties in getting the e-Invoice to be issued in the name of the employer (as Buyer) for certain expenses. In this regard, the LHDN provides the following concession:

1. (a) Businesses will be allowed to proceed with the use of e-Invoice issued in the name of the employee or existing supporting document issued by the Supplier to support the particular transactions as proof of expense for tax purposes.

2. (b) In the event where employees paid for expenses incurred overseas, both employer and employee are not required to issue a self-billed e-Invoice. As such, LHDN will accept the foreign bills/ receipts/ invoices as a proof of expense.


7.5 Note that this exception will only be applicable if the employer is able to prove that the employee is acting on the employer’s behalf in incurring the expenses.

7.6 The steps involved for the scenario above are as follows:

Step 1: For any expense claim to be made by employees, employees should first seek confirmation with the Supplier if the e-Invoice can be issued in the name of the employer (as Buyer).

Step2: Where an e-Invoice can be issued to the employer, the employees should provide the details of the employer in order for the e-Invoice to be issued to the employer. Where Step 1 is not possible, the employees should provide their individual details to the Supplier for issuance of e-Invoice to the employee (as Buyer).

Step 3: Payment will be made by the employees upon receiving the validated e-Invoice from the Supplier.

Step4: Employees submit their expense claim by submitting the validated e-Invoice (be it issued in the name of the employer or employee) as supporting document to the employer.