Many businesses issue invoices in advance—but with LHDN’s MyInvois system, this brings up a crucial question:
“If we bill on 25 June for July’s services, should the e-Invoice date be 25 June or 1 July?”
Let’s break it down.
🔄 The Real-World Scenario
Imagine your business issues an invoice on 25 June for:
- June incidental charges
- July monthly fee (e.g. tuition, subscription, or care home services)
You submit it to MyInvois on 25 June. Now the questions are:
- Will LHDN treat this as June revenue?
- Is this invoice date compliant?
📌 What LHDN e-Invoice Requires
LHDN’s MyInvois system requires:
- A valid invoice date (date of issuance)
- A clear description of the goods/services
👉 You are responsible for proper revenue recognition—even if you bill in advance.
🟢 Key point: LHDN uses the invoice date to determine the reporting month, but this doesn’t override your accounting treatment (e.g. SST or deferred income).
📅 Accounting and Tax Implications
Proper recognition (accounting view):
- June expenses → Recognized in June
- July service fee → Deferred, recognized in July
💡 Deferred income is posted to your balance sheet first, then transferred to profit/loss when earned.
⚠️ What Happens If You Invoice Early?
If you issue the full invoice on 25 June:
- LHDN will treat the entire amount as June revenue
- You may end up paying tax early on July’s income
✅ Recommended Options
Option 1: Split the Invoice
- 25 June – Invoice A: Covers June expenses
- 1 July – Invoice B: Covers July fees
➡️ Clear, clean, and compliant
Option 2: Delay the Invoice
- Prepare it in June, but date and submit it on 1 July
➡️ Matches service delivery month
Option 3: Use Clear Descriptions
- One invoice dated 25 June
- Line items should clearly show:
- “June incidental charges”
- “July monthly fee (advance billing)”
➡️ Then adjust in your internal accounts for proper recognition
🚫 What to Avoid
- Don’t backdate invoices to match accounting periods
- Don’t combine multi-month charges under vague line items
- Don’t issue invoices far in advance without clear breakdowns
📊 Example Breakdown
| Item | Amount (RM) | Service Period | Recommended Invoice Date |
|---|---|---|---|
| Medication reimbursement | 250.00 | June | 25 June |
| Monthly fee (advance) | 2,000.00 | July | 1 July (preferred) |
📥 Best solution: Split into two e-Invoices.
🧾 How This Affects MyInvois Submission
Every e-Invoice includes:
- Document date
- Supply description
- Submission timestamp
💡 The invoice date determines LHDN’s reporting period—even if your accounting defers the income.
🧠 Expert Tip
“Use the invoice date that matches the start of your service period. This aligns your e-Invoice, revenue recognition, and tax compliance—reducing audit risks.”
📝 Final Thoughts
If you bill in advance, be sure to:
- Align invoice date with service period
- Split invoices when necessary
- Avoid mismatches between billing and accounting
This helps prevent:
- Early tax payment
- Revenue misclassification
- Compliance issues with LHDN
💼 Need Help Structuring Your Billing?
At KinraSoft, we support businesses in:
- Automating recurring e-Invoices
- Setting correct invoice dates
- Syncing billing with tax and accounting systems