Which LHDN e-Invoice phase are you in?

This is Table 16.1 of the LHDN e-Invoice Specific Guideline v4.8, published 7 July 2026. The bands are on annual turnover. The third column is the interim relaxation for each band — the period during which the eased rules described further down applied.

Note the two dates against the last band. Businesses up to RM5 million came in on 1 January 2026. A second date of 1 July 2026 applies to businesses that commenced operations in 2023 to 2025 and reach RM1 million or more in turnover, which is the band most people miss when they read a summary.

The 1 July 2026 date is the one that surprises people, because it does not follow the pattern of the others. Every earlier row is a turnover band with a start date. This one adds a condition about when the business started trading: it applies to businesses that commenced operations in 2023, 2024 or 2025 and reach RM1 million or more in annual turnover.

That combination describes a specific and fairly large population — companies incorporated in the last three years that have grown past the exemption threshold. A business incorporated in 2024 that did RM1.4 million last year is in scope from 1 July 2026, and nothing about it looks like the enterprises the phase-in started with. If your company was formed in that window and has crossed a million in turnover, this row is yours, and the general commentary about the January 2026 date does not describe your date.

The practical consequence is that being newer is not a reason to assume you are outside the regime. It used to be, when the bands were purely about size and the smallest one had not started. It is not any more.

The exemption threshold is RM1,000,000 in annual turnover. Below it you are outside the mandate. It was raised from RM500,000 by a Cabinet decision on 6 December 2025, which took a substantial number of the smallest businesses back out of scope after they had already been told to prepare.

That same decision cancelled Phase 5 entirely. Phase 5 was the band that would have brought the businesses between the old and new thresholds in on their own timetable; it no longer exists, and there is no later phase waiting behind it for micro-businesses. If your turnover is under RM1 million, there is currently no phase scheduled that brings you in.

Two things follow. First, if you prepared for a Phase 5 date, that date is gone — check your position against the current threshold rather than against the plan you made in 2025. Second, the threshold is a Cabinet decision rather than a fact of nature, and thresholds get revisited. A business sitting at RM900,000 and growing should build as though it will cross it, because crossing it is a business event with a compliance consequence and not the other way round.

The relaxation for the whole SME band was extended to 31 December 2027 by version 4.7 of the Specific Guideline, published 20 April 2026. It is a genuine easing rather than a delay of the obligation, and it permits four specific things.

One: consolidated e-invoices are permitted for all activities. Outside the relaxation, consolidation is limited to defined situations; during it, the restriction on which activities may be consolidated does not apply. Two: free-text product descriptions are allowed, so a line does not have to be resolved to a precise classification to be submitted. Three: there is no obligation to issue an individual e-invoice even where the buyer requests one. Four: there is no prosecution under section 120 of the Income Tax Act 1967.

Read together, those four turn the obligation into something a business can satisfy with a consolidated monthly document containing plainly described lines. That is a much lower bar than the steady-state regime, and it is why so many businesses believe they are compliant and are not — because they satisfy the relaxed version and have built nothing that satisfies the other one.

The date to plan against is therefore not your band's start date. It is 31 December 2027, when all four of those permissions end at once, on the same day the SVDP window closes.

Full enforcement begins on 1 January 2028. From that date the eased treatment described above is gone: consolidation returns to the defined situations that permit it, descriptions must be properly classified, an individual e-invoice must be issued where the buyer requires one, and prosecution under section 120 is available again.

The gap between now and then is not as generous as it reads. Going from a consolidated monthly document with free-text lines to per-transaction e-invoices with correct buyer identification and correct classification codes is not a switch you turn on in December 2027. It is a data problem: buyer TIN, identification scheme and number, SST registration where one exists, state code, and a classification code per line, held for every customer and every product you sell.

Businesses that collect those fields at the point a customer or product is created spend the intervening period doing nothing dramatic. Businesses that intend to chase them at the end will be chasing several thousand of them at once, from customers who have no particular reason to reply quickly.

The guideline is a living document and the version number is how you tell whether advice you are reading is current. Any page quoting dates without naming a version is quoting something, and you cannot tell what.

Version 4.6 was the version in force before the April 2026 update. Version 4.7, published 20 April 2026, extended the relaxation for the whole SME band to 31 December 2027. Version 4.8, published 7 July 2026, is the current one and carries the Special Voluntary Disclosure Programme at Section 17, along with the SVDP 1.2 and 1.3 document versions and the worked examples covering back-dated consolidated submissions and the RM10,000 transactional threshold.

Find your row, then ignore it. That sounds contrary, but the start date only tells you whether the obligation has begun; it tells you nothing about whether what you are issuing validates, and after 1 January 2026 almost every mandated band has begun.

The two questions that matter are what proportion of your issued invoices LHDN actually holds as validated, and whether your customer and product records carry the fields the steady-state regime requires. The first is a reconciliation. The second is a gap report over your existing data. Both are answerable in days, and neither is answerable by reading a table of dates.

If the reconciliation turns up invoices that were never submitted, that population has a defined route while the disclosure window is open. It closes on 31 December 2027, alongside everything else on this page.