The RM10,000 rule: what changed for Malaysian expense claims on 1 January 2026
Since January, any single transaction above RM10,000 can no longer go into a consolidated e-Invoice. That pushes work onto the buyer, and onto whoever is holding the receipt. Here is what the LHDN guidelines actually say.
Most e-invoicing coverage in Malaysia has been written for the seller. Which phase are you in, how do you connect to MyInvois, how do you validate a document. That is half the picture, and for a lot of businesses it is the easier half.
The other half is what arrives at your finance team. Someone on your staff pays for something, and now they need a document that names your company as the buyer. On 1 January 2026 a rule took effect that makes this considerably more common, and it has had much less attention than it deserves.
What changed in January
Suppliers have always had a fallback. If a buyer did not ask for an e-Invoice, the supplier could bundle the day's or the month's sales into a single consolidated e-Invoice and submit that instead. Convenient for the seller, and invisible to the buyer.
That fallback now has a ceiling. LHDN's e-Invoice Specific Guideline lists the activities where consolidation is not permitted, and as of 1 January 2026 the list includes a line that applies to everyone:
Any single transaction with a value exceeding RM10,000.
It sits in Table 3.6, under "All industries". The guideline is direct about what follows for the supplier:
such taxpayers will be required to obtain the Buyer's details for the issuance of e-Invoice and will not be allowed to issue consolidated e-Invoice.
Read that from your side of the counter. Above RM10,000, the seller has to collect your company's details before they can issue anything, so your business cannot stay anonymous in that transaction even if you would rather not deal with it that day.
The sentence that puts this on your staff
Section 7 of the same guideline deals with employees claiming expenses. It says:
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.
And it sets out the first step plainly: the employee "should first seek confirmation with the Supplier if the e-Invoice can be issued in the name of the employer (as Buyer)".
So the obligation lands at the point of sale, on whoever is holding the company card, and not on the finance team at month end where you would probably want it. The person who has to remember is usually the one least equipped to, because their job is not accounting.
There is relief in the guideline, and it is worth knowing precisely. Section 7.4 allows a business to use an e-Invoice issued in the employee's own name, or existing supporting documents, as proof of expense. It comes with a condition: the expenses must be "clearly stated in the employer's policy". If your expense policy does not say anything on the subject, you are relying on a concession you have not actually met the terms of.
The nine activities where consolidation is off the table
The RM10,000 line is one entry in Table 3.6. The full list, as of Version 4.8 of the guideline:
| Industry or activity | Where consolidation is not allowed |
|---|---|
| Automotive | Sale of any motor vehicle |
| Aviation | Flight tickets, private charter |
| Luxury goods and jewellery | On hold, details pending |
| Construction | Contracts under the Income Tax (Construction Contracts) Regulations 2007 |
| Licensed betting and gaming | Pay-outs to winners |
| Payments to agents, dealers, distributors | Per Section 83A(4), Income Tax Act 1967 |
| All industries | Any single transaction above RM10,000, from 1 January 2026 |
| Electricity service providers | Distribution, supply or sale of electricity, from 1 January 2026 |
| Telecommunications | Postpaid and internet subscriptions, sale of electronic devices, from 1 January 2026 |
Three of the nine started this year. If your team buys laptops and phones, pays utility bills, or spends over RM10,000 in one go, you are in scope for something that was not there in 2025.
Whether this applies to you at all
Two thresholds decide it, and they are frequently conflated.
The implementation timeline runs by annual turnover. More than RM100 million from 1 August 2024. More than RM25 million from 1 January 2025. More than RM5 million from 1 July 2025. Up to RM5 million from 1 January 2026.
Separately, the guideline exempts businesses below a revenue floor. Section 1.6.1 lists taxpayers "with an annual turnover or revenue of less than RM1,000,000" among those not required to issue e-Invoices, and Section 1.6.2 confirms that for those businesses, ordinary receipts still serve as proof of expense.
If you are under RM1 million in revenue, the urgency you are being sold is largely someone else's. If you are above it, the January change already applies to you.
What actually happens if you ignore it
It is worth being accurate here, because there is a lot of loose talk about penalties.
We could not find a provision that penalises a buyer for failing to request an e-Invoice. The duty to issue sits with the supplier. What a buyer risks is weaker documentation: a validated e-Invoice is what substantiates an expense for tax purposes, and without one your deduction rests on whatever you did keep.
On enforcement, the guideline says LHDN "will not undertake any prosecution action under Section 120 of the Income Tax Act 1967 during the interim relaxation period", provided the taxpayer meets the conditions set out for that period.
The more interesting signal is what came next. LHDN has opened an e-Invoice Special Voluntary Disclosure Programme running from 7 July 2026 to 31 December 2027. It covers taxpayers who never submitted, taxpayers who submitted with errors, and, notably, taxpayers "currently undergoing or... notified by the IRBM that they will be undergoing an e-Invoice compliance review". Disclosures made under the programme are not subject to penalties or prosecution.
You do not usually open a disclosure window unless you intend to start checking, and the wording above says compliance reviews are already happening. That strikes us as a better reason to sort this out than a penalty nobody can point to.
The operational shape of the problem
Strip away the legislation and the daily reality is small and repetitive.
Someone buys something. They have to ask the merchant for an e-Invoice in the company's name. That might mean a QR code on the receipt, a portal, a form asking for a TIN and a registered address they do not have memorised. They are standing at a counter. The document, if it arrives, comes by email, days later, to whichever inbox they gave.
Then it has to find its way back to the right expense claim.
None of this is difficult. It is just constant, and it is spread across everyone in the company rather than concentrated where the accounting expertise sits. That is the awkward part: the obligation was placed at the point of sale, but the consequence lands at month-end.
Where Groot fits
We built for the inbound side of this, because it is the side nobody was automating.
When a receipt is captured in Groot, the system reads the QR code on it and resolves the merchant's e-Invoice portal. An agent completes the merchant's request form using the business's registered details, so the person who made the purchase does not have to. The resulting e-Invoice is received by email and matched back to the originating expense claim automatically, using the buyer reference, the merchant's own invoice number, or the supplier TIN with amount and date.
That is the whole loop, and it runs without the employee doing the asking.
We are not going to tell you this makes you compliant. Compliance is a property of your business and your records, not of any software. What we can say is that the mechanical work in the paragraph above is work your team should not be doing by hand, and since January there is a good deal more of it.
Sources
All quotations are from the Inland Revenue Board of Malaysia's published guidelines. Section and table numbers refer to the versions current at the time of writing.
- e-Invoice Specific Guideline (Version 4.8), IRBM. Table 3.6 and Section 3.7 on activities excluded from consolidation. Section 7 on employee expense claims. Section 16 on the interim relaxation period. Section 17 on the Special Voluntary Disclosure Programme.
- e-Invoice implementation timeline, IRBM. Current phased dates and the exemption for taxpayers with annual turnover or revenue below RM1 million.
- e-Invoice guidelines index, IRBM, for the current published versions.
This article is general information about published tax guidelines. It is not tax advice, and Groot is not a licensed tax agent. For how these rules apply to your business, speak to your tax agent or accountant.