A figure announced at the 26th National Tax Conference in Kuala Lumpur on 4 August 2026 should be on every Malaysian business owner’s radar: LHDN raised RM4.4 billion in additional tax assessments as of 30 June 2026 following its audit and compliance efforts.
These are additional tax assessments arising from LHDN’s audit and compliance activities. LHDN has also expanded its use of technology and artificial intelligence in tax administration, including analysing more than 1.6 billion e-Invoices to strengthen compliance and risk detection.
Source: LHDN CEO Datuk Dr Abu Tariq Jamaluddin, speaking at the 26th National Tax Conference, as reported by The Star.
What e-Invoicing Has Changed About Compliance
e-Invoicing is giving LHDN access to more structured digital transaction information, allowing the agency to strengthen its compliance and risk-assessment processes.
In April 2026, LHDN conducted a nationwide e-Invoice compliance review operation from 20 to 24 April. During the operation, 108 taxpayers were identified as having failed to implement e-Invoicing under Phase 1 and Phase 2 despite being required to do so.
LHDN also reported that its review of e-Invoice data and subsequent compliance efforts resulted in 38,906 taxpayers submitting income tax returns declaring RM3.5 billion in previously unreported income, involving RM760.7 million in tax payable.
By June 2026, the same e-Invoice compliance programme had expanded to 52,540 taxpayers, who had reported RM4.07 billion in previously unreported income. This represents the subsequent overall figure from the programme and includes the earlier 38,906 taxpayers and RM3.5 billion reported in April.
This illustrates how e-Invoicing is becoming an increasingly important part of Malaysia’s digital tax administration and compliance framework.
What Phase 4 Means for Your Business Right Now
For businesses with annual revenue or sales above RM1 million and up to RM5 million, the Phase 4 e-Invoice implementation date is 1 January 2026.
Businesses with annual revenue or sales up to RM1 million are exempt from e-Invoice implementation.
HASiL has provided an interim relaxation period until 31 December 2027 for taxpayers with a 1 January 2026 or 1 July 2026 implementation date. During this period, taxpayers are allowed to issue consolidated e-Invoices for transactions, subject to the requirements set out by HASiL, and no penalties will be imposed during the transition period where the stipulated requirements are met.
The implementation date itself remains important: businesses should use the relaxation period to complete their e-Invoice implementation and ensure their systems and records are ready.
For certain transactions, HASiL also requires an individual e-Invoice rather than a consolidated e-Invoice. For example, HASiL’s guidance states that from 1 January 2026, a single transaction exceeding RM10,000 requires an individual e-Invoice.
What Audit-Ready Accounting Looks Like in 2026
Businesses should maintain accurate financial records throughout the year and ensure their accounting records are properly supported by their invoices and transaction documentation.
With e-Invoicing becoming an increasingly important part of Malaysia’s tax administration, businesses should ensure their bookkeeping, invoicing, SST records, and supporting documents are properly maintained and ready for compliance reviews.
Emspaced Accounting helps Malaysian businesses maintain organised accounting records, navigate e-Invoicing setup and MyInvois registration, and keep their books audit-ready throughout the year.
Reach us now or visit emspaced.com to book a free consultation.
