As Malaysia's e-Invoice implementation deadlines approach for businesses of all sizes, one of the most critical decisions organisations face is how they'll connect to the Lembaga Hasil Dalam Negeri's (LHDN) MyInvois System.
With two distinct options available—the MyInvois Portal and API Integration—choosing the right approach based on your business size, transaction volume, and technical capabilities can significantly impact your implementation success.
Understanding Your e-Invoice Transmission Options
The LHDN has developed two primary mechanisms for transmitting e-Invoices:
MyInvois Portal
A web-based platform hosted by LHDN that allows businesses to create, submit, view, and manage e-Invoices directly through a browser interface.
API Integration
A technical solution that enables direct computer-to-computer communication between your business systems and the LHDN's MyInvois System.
Both options successfully deliver e-Invoices to LHDN, but they differ significantly in complexity, cost, efficiency, and suitability for different business sizes and types.
MyInvois Portal: The Accessible Option
How It Works
The MyInvois Portal provides a straightforward web interface where businesses can:
1. Generate individual e-Invoices by completing online forms with all required fields
2. Upload batches of e-Invoices using pre-defined Excel spreadsheet templates
3. View, search, and manage their e-Invoice history
4. Handle rejections and cancellations through simple user interfaces
After logging in to the MyTax Portal, businesses can access the MyInvois Portal and perform all essential e-Invoice functions without additional software development or integration costs.
Ideal For:
Micro and small businesses with limited transaction volumes
Organisations with basic technical capabilities and minimal IT support
Businesses with straightforward invoicing needs and standard transaction types
Companies seeking a low-cost implementation option with minimal upfront investment
Businesses that prefer manual control over their invoicing process
Advantages:
No development costs: The portal is freely available to all registered taxpayers
No technical expertise required: Staff can be trained quickly on the user interface
Immediate availability: Ready to use as soon as you're registered
Built-in validation: The portal ensures all mandatory fields are completed
Low implementation barrier: Minimal change to existing IT infrastructure
Limitations:
Manual data entry: Each invoice requires manual input or spreadsheet preparation
Time-consuming for high volumes: Not efficient for businesses with numerous daily transactions
Limited automation: Cannot integrate directly with your accounting or ERP systems
Basic functionality: Lacks customised workflows or advanced features
Potential for human error: Manual data entry increases error risk
API Integration: The Scalable Solution
How It Works
API integration enables direct system-to-system communication through several methods:
1. Direct integration of your Enterprise Resource Planning (ERP) system with the MyInvois System
2. Connection through Peppol service providers who facilitate e-Invoice transmission
3. Integration via non-Peppol technology providers who offer middleware solutions
This approach allows your existing business systems to automatically generate and submit e-Invoices in the required XML or JSON formats without manual intervention.
Ideal For:
1. Medium and large enterprises with significant transaction volumes
2. Organisations with strong IT capabilities or technology partners
3. Businesses with complex invoicing requirements or specialised transaction types
4. Companies seeking to automate their invoicing processes and reduce manual handling
5. Businesses already using accounting systems or advanced ERP
Advantages:
High efficiency for large volumes: Can handle thousands of transactions with minimal human intervention
Direct integration with existing systems: Seamlessly connects with your accounting or ERP software
Reduced manual errors: Minimizes human data entry mistakes
Process automation: Enables end-to-end digital workflows
Better scalability: Can easily accommodate growing transaction volumes
Real-time validation: Immediate feedback on e-Invoice status
Limitations:
Development costs: Requires technical expertise and possibly external vendors
Implementation complexity: More challenging to set up initially
Longer lead time: Needs thorough testing before going live
Ongoing maintenance: Requires technical support for updates and troubleshooting
Digital certificate management: Additional security requirements for authentication
Decision Factors Based on Business Size
Micro to Small Businesses (Revenue up to RM1,000,000)
For small businesses with limited transaction volumes and basic technical capabilities, the MyInvois Portal typically offers the most practical solution:
Transaction volume: Generally manageable through the portal interface
Cost consideration: Minimal budget for technical implementation
In-house capabilities: Often lack dedicated IT resources
Implementation timeline: Need a simple, quick solution by July 2026
Recommendation: MyInvois Portal, with potential use of batch upload for monthly consolidated e-Invoices. However, it might take a longer time due to manual operations and limited automation. Consider opting for a software solution that integrates with MyInvois to streamline your workflow, reduce repetitive tasks, and ensure smoother compliance as your business grows.
Small to Medium Businesses (Revenue RM1 million to RM5 million)
These businesses face a more nuanced decision based on their specific circumstances:
Transaction volume: May range from dozens to hundreds of transactions daily
Technical sophistication: Varies widely based on industry and business model
Integration potential: Many use accounting software that might offer API integration
Growth trajectory: Need to consider future scaling requirements
Recommendation: Assess based on transaction volume and existing systems. Businesses with higher volumes or growth plans should consider API integration, while those with moderate volumes might find the MyInvois Portal sufficient, especially using batch uploads.
Medium to Larger Enterprises (Revenue over RM5 million)
For businesses with substantial transaction volumes and complex operations, API integration typically provides the only viable option:
Transaction volume: Often hundreds or thousands of transactions daily
System complexity: Usually have established ERP systems
Technical resources: Typically have IT departments or technology partners
Implementation timelines: January 2025/August 2024/July 2025
Recommendation: Implement API integration, considering the most suitable method based on existing systems and technical capabilities.
Hybrid Approaches: The Best of Both Worlds
Some businesses may benefit from a hybrid approach, using both transmission methods for different purposes:
API for high-volume, standard transactions while using the portal for exceptions or adjustments
MyInvois Portal for initial implementation while developing API integration for long-term use
API for customer invoices, but MyInvois Portal for less frequent vendor transactions
MyInvois Portal for the transition period, while technical teams prepare full API integration
This approach can provide immediate compliance while allowing for more sophisticated implementation over time.
Cost-Benefit Analysis
When evaluating options, consider these cost factors:
1. MyInvois Portal Costs:
Staff time for manual entry or spreadsheet preparation
Training expenses
Potential opportunity costs from manual processes
Error correction and management time
2. API Integration Costs:
Initial development or vendor expenses
Ongoing maintenance and support
System updates and testing
Technical staff time
Digital certificate management
Weigh these costs against benefits such as:
Time savings from automation
Reduced error rates
Improved data quality
Enhanced business intelligence
Staff productivity improvements
There's no one-size-fits-all solution for e-Invoice implementation. Your choice between the MyInvois Portal and API Integration should be based on a careful assessment of your business size, transaction volume, technical capabilities, and strategic priorities.
For smaller businesses with limited resources and straightforward needs, the MyInvois Portal offers a practical, accessible option that requires minimal investment. For larger organisations with significant transaction volumes and existing systems, API integration typically provides the efficiency and scalability needed for sustainable compliance.
Which ever approach you choose, begin your implementation planning well before your mandatory deadline to ensure adequate time for setup, testing, and staff training. Remember that the six-month interim relaxation period following your implementation date provides valuable time to refine your approach, but having the basic infrastructure in place by your deadline is essential for compliance.
By matching your e-Invoice transmission method to your business size and needs, you can minimise implementation challenges while maximising the potential benefits of Malaysia's digital transformation initiative.
About the Author
Mr. Chin Chee Seng is the Independent Non-Executive Director of AutoCount and the Founder of CCS Group.
This e-Invoice News series is a collaboration with AutoCount.
