Self-Billed Invoices in Malaysia — When Do You Need Them?

What is a self-billed invoice?

Normally, the supplier (the business selling goods or services) issues the invoice to the buyer. But in certain situations, LHDN requires the buyer to issue the invoice instead. This is called a self-billed invoice or self-billing.

In technical terms, the buyer creates an e-invoice where they are listed as the issuer, and the supplier is listed as the recipient. The UBL document has the buyer and supplier parties swapped compared to a normal invoice.

When do you need to self-bill?

LHDN requires self-billed e-invoices in these scenarios:

1. Purchases from foreign suppliers

If your Malaysian business purchases goods or services from a foreign supplier (a company or individual outside Malaysia), you must issue a self-billed e-invoice for that transaction.

Example: You hire a freelance designer from Singapore to create marketing materials. You (the Malaysian buyer) issue the self-billed e-invoice.

2. Purchases from individuals

When buying from individuals who are not running a business, self-billing is required. Common scenarios include:

• Agricultural purchases — Buying produce from individual farmers
• Scrap material purchases — Buying recyclables from individuals
• Second-hand goods — Purchasing used equipment from private sellers

3. Specific insurance and agency transactions

Certain transactions in the insurance industry and agency arrangements require self-billing under LHDN guidelines.

4. Betting and gaming payouts

Operators in the betting and gaming industry must self-bill for certain payout transactions.

How self-billing works in MyInvois

The key difference in a self-billed e-invoice is the party swap in the UBL 2.1 document:

The UBL document structure remains the same — 55 mandatory fields — but the supplier and customer blocks are swapped.

Important: The issuer TIN must be yours

Even though the supplier party in the document is the foreign supplier or individual, the issuer TIN (the business submitting to MyInvois) must be your Malaysian business TIN. This is because only Malaysian TIN holders can submit to MyInvois.

Common mistakes with self-billing

1. Not swapping the parties correctly

The most common error is filling in a self-billed invoice like a normal invoice. The supplier and customer blocks must be swapped, or LHDN will reject the submission.

2. Using the wrong document type code

Self-billed invoices use specific document type codes in MyInvois:

• Self-billed invoice: Document type 02
• Self-billed credit note: Document type 03
• Self-billed debit note: Document type 04

Using the standard invoice type code (01) for a self-billed transaction will result in rejection.

3. Missing supplier details for foreign parties

Even though the supplier is foreign, you still need to provide as many details as possible:

• Supplier name
• Country code
• Address (if available)
• Tax identification number (if the foreign country has one)

For individuals, you may use a general identification number or passport number.

Do you need self-billing?

Ask yourself these questions:

1. Do you buy from overseas suppliers? → Yes, you need self-billing
2. Do you purchase from individuals (not businesses)? → Yes, you need self-billing
3. Do you only sell to Malaysian businesses? → No self-billing needed for those transactions

If you're a restaurant buying imported ingredients, a manufacturer sourcing raw materials from foreign suppliers, or a company hiring international freelancers — you need self-billing capability.