Unlike the traditional method of e-invoicing where the supplier creates and issues the e-Invoices to the buyer, a self-billed e-Invoice is a type of e-Invoice that is created and issued by the buyer on behalf of the supplier. In a self-billed e-Invoice scenario, the buyer will assume the role of the supplier, acting as the issuer of the e-Invoice to create the e-Invoice, which is then submitted to the Inland Revenue Board of Malaysia (IRBM) for validation. Once validated, the buyer can use the validated e-Invoice as proof of expense for tax purposes.  

E-invoicing goes beyond converting an invoice to a PDF. One of the basic requirements for issuing an e-Invoice is the completion of 51 required fields. The IRBM has provided a list specifying the details to be included by the buyer in a self-billed e-Invoice. Buyers play a crucial role in the self-billed e-invoicing process, as they are responsible for obtaining necessary information from the supplier to ensure the accuracy and completeness of e-Invoice details. The required fields for e-Invoice will include the buyer's and seller's names, addresses, tax identification numbers (TIN), a description of the products or services, quantities, pricing, etc. 

According to IRBM’s guidelines, there are certain circumstances where another party (other than the Supplier) will be allowed to issue a self-billed e-Invoice on behalf of the Supplier, which include: 

• Payment to agents, dealers, distributors 

• Goods sold or services rendered by foreign suppliers 

• Profit distribution (e.g., dividend distribution) 

• e-Commerce transactions 

• Pay-out to all betting and gaming winners 

• Acquisition of goods or services from individual taxpayers who are not conducting a business 

Let's look at the following example to have a better understanding of a self-billed e-Invoice: 

A property agent successfully sells a house and receives a commission from the property development company. However, since the property agent is unable to issue an e-Invoice for the service rendered, the property development company (buyer) would need to assume the role of the supplier, acting as the issuer to generate a self-billed e-Invoice as proof of expense for tax purposes.