Malaysia’s 2025 E-Invoicing Deadline: Xero Peppol Compliance Playbook
A Complete Guide to Malaysia’s 2025 E-Invoicing Law and How Xero Makes Peppol Compliance Easy
Malaysia’s E-Invoicing Requirements: What’s Changing in 2025
Overview:
Beginning 1 July 2025, all Malaysian businesses with annual revenue exceeding RM500,000 must adopt Peppol-compliant e-Invoicing via the Inland Revenue Board (IRBM). Businesses earning below that threshold must comply by 1 January 2026.
E-Invoicing Rollout Schedule
| Phase | Annual Turnover | Mandatory From | Key Details |
|---|---|---|---|
| Wave 1 | Over RM100 million | 1 August 2024 | Initial rollout with soft launch period |
| Wave 2 | RM25M – RM100 M | 1 January 2025 | Validation required for every invoice |
| Wave 3 | RM500K – RM25 M | 1 July 2025 | Applies to most small and medium businesses |
| Wave 4 | RM150K – RM500 K | 1 January 2026 | Final phase of mandatory compliance |
Businesses not issuing line-by-line e-Invoices must submit a monthly consolidated e-Invoice to IRBM within 7 days after each month ends.
What Is Peppol and Why It Matters
Summary:
Peppol is an international e-Invoicing standard designed for secure, structured, and interoperable invoice exchange. Malaysia adopted Peppol to ensure e-Invoices are efficiently validated and submitted through the MyInvois platform.
Key Features of Peppol:
- Standardized, machine-readable invoice data
- Validation by IRBM with a unique Document Identification Number (DIN)
- Monthly summary submissions allowed for buyers not requesting individual e-Invoices
How Xero Simplifies Peppol Compliance
Good news for Xero users:
Xero is an IRBM-recognized Peppol Service Provider via its Tickstar integration. This means you can issue fully compliant e-Invoices directly from Xero—without relying on third-party platforms or manual uploads.
Key Xero Features for E-Invoicing:
- Peppol access included in all subscription plans
- Direct integration with MyInvois (IRBM’s e-Invoicing portal)
- Auto-generated tracking categories aligned with IRBM classification codes
- One-click creation and submission of consolidated monthly e-Invoices
Step-by-Step Guide: Sending Your First Peppol E-Invoice in Xero
Follow these steps to begin:
- Register on MyInvois and designate Xero (Tickstar) as your Peppol Service Provider.
- In Xero, go to Settings → E-Invoicing and connect your MyInvois account using the QR code or login credentials.
- Make sure all customer and supplier records include valid Tax Identification Numbers (TINs).
- Activate the MyInvois Classification tracking category in Xero.
- When creating invoices or bills, assign the correct IRBM classification code to each line item.
- At month-end, Xero generates a draft consolidated e-Invoice for review. Submit it once verified.
- IRBM validates the submission and issues a DIN for compliance records.
After the initial setup, monthly submissions typically take under 15 minutes.
Why Businesses Choose Xero for E-Invoicing in Malaysia
1. Faster Payment Processing
E-Invoices are validated in real time, reducing delays and improving cash flow.
2. Reduced Errors and Manual Input
Xero automates the reporting process to IRBM, minimizing human error and manual entry.
3. Audit-Ready Records
Every invoice includes a DIN and is traceable, supporting full audit compliance.
4. Cross-Border Invoice Support
Peppol is globally accepted. Xero ensures your invoices align with both local and international standards.
5. All-in-One Compliance Platform
From invoice creation to IRBM submission, Xero handles everything within a single interface.
E-Invoicing Compliance Checklist for Malaysian Businesses
Stay compliant with this quick checklist:
- Register with IRBM’s MyInvois platform
- Choose Xero as your Peppol Service Provider
- Ensure customer and supplier TINs are complete in your records
- Enable tracking for IRBM classification codes in Xero
- Review and submit consolidated invoices monthly
- Retain IRBM-issued DINs for audit purposes
Frequently Asked Questions
1. Is there a grace period after 1 July 2025?
No. Grace periods only applied to large corporations in Wave 1. All SMEs must meet their designated deadlines.
2. Do I still need to issue traditional invoices?
You may issue standard receipts for transactions where the buyer does not request an e-Invoice. However, all transactions must be reported via a monthly consolidated e-Invoice.
3. Can Xero manage international invoices?
Yes. Xero supports cross-border e-Invoicing for Peppol-enabled buyers and generates compliant records for international clients.
4. Is Peppol access in Xero an additional cost?
No. All Xero Malaysia subscription plans include Peppol functionality at no extra charge.
5. How long does IRBM validation take?
Usually within a few seconds. Xero displays the DIN immediately after IRBM approval.
Start Your E-Invoicing Journey with Xero
Avoid last-minute compliance issues by preparing today. With Xero, you can:
- Automate Peppol submissions to IRBM
- Minimize reporting errors and penalties
- Speed up payment cycles
- Simplify monthly e-Invoicing workflows
Start your free 30-day Xero trial today and get ready for Malaysia’s 1 July 2025 e-Invoicing mandate.