Keep business records in Malaysia for at least 7 years. Section 82 of the Income Tax Act 1967 requires this, and section 245 of the Companies Act 2016 also requires a Sdn Bhd to record entries within 60 days and keep them 7 years after each transaction completes. Electronic records in English or Bahasa Malaysia are acceptable.
- Keep business records for at least 7 years; section 82 of the Income Tax Act 1967 applies to businesses generally.
- A Sdn Bhd must also record entries within 60 days and keep records 7 years after each transaction completes.
- Scanned and digital records are acceptable if they are readable and can be produced when LHDN asks.
- Validated e-Invoices on MyInvois do not replace your own records; keep copies linked to your books.
- An unsupported expense can be disallowed, so fix missing documents early, not when a tax query arrives.
How long must you keep business records in Malaysia?
At least seven years. Two laws set the period, and most businesses fall under at least one of them:
| Law | Who it covers | What it requires |
|---|---|---|
| Income Tax Act 1967, section 82 | Businesses generally: sole proprietors, partnerships and companies | Keep records for 7 years, in English or Bahasa Malaysia; electronic records are acceptable if they can be produced on request |
| Companies Act 2016, section 245 | Companies, including every Sdn Bhd | Keep accounting records that explain the transactions and financial position; make entries within 60 days of a transaction being completed; retain them for 7 years after the transactions are completed |
For a Sdn Bhd the two rules overlap, so the practical answer is simple: record transactions promptly and keep every financial record for at least seven years. A dormant company is not excused either; it still keeps its records and files Form C every year. The rules apply whether you keep paper, digital files or both.
When does the 7-year period start?
Under the Companies Act, the seven years run from the completion of the transaction, so anything still in progress has not started its clock. A simple habit satisfies both laws: treat each financial year as one file and keep it for at least seven full years after that year ends.
| Financial year ended | Keep that year's records until at least |
|---|---|
| 31 December 2024 | 31 December 2031 |
| 31 December 2025 | 31 December 2032 |
| 30 June 2026 | 30 June 2033 |
It is sensible to keep some records longer:
- Loans and hire purchase: keep the agreement and statements until the facility is settled, then for seven more years.
- Assets you still own: keep the purchase invoice for a machine, van or renovation while the asset is in use and capital allowances are being claimed, and for seven years after it is sold or written off.
- Open matters: anything linked to a tax query, a dispute or an insurance claim should stay until the matter is closed, even if seven years have passed.
If you are unsure about a particular document, your tax agent can confirm how long to keep it.
Which records should you keep?
Keep anything that supports a figure in your accounts or tax return. Use this table as a checklist:
| Area | Records to keep | Why they matter |
|---|---|---|
| Sales | Sales invoices, cash bills, receipts issued, credit notes, POS daily reports, e-Invoices | Prove the income you declared |
| Purchases and expenses | Supplier invoices, receipts, delivery orders, payment vouchers, staff claims | Support your deductions and cost of sales |
| Bank and payments | Statements for every bank account, e-wallet and merchant settlement reports, transfer confirmations | Link money in and out to the documents |
| Payroll | Payslips, employment contracts, EPF, SOCSO, EIS and PCB records, Form EA, Form E | Back up salary costs and statutory payments |
| Assets and financing | Asset invoices, hire purchase and loan agreements, loan statements | Support capital allowances and loan balances |
| Contracts | Tenancy agreements, customer and supplier contracts, accepted quotations | Explain recurring charges and terms |
| Accounts and tax | General ledger, trial balance, bank reconciliations, financial statements, tax computations, Form C, CP204, SST returns | Show how your figures were built |
A bank statement alone shows that money moved, not what it paid for or why it was a business cost. Keep the invoice or receipt behind each payment: it is what lets an expense pass the ‘wholly and exclusively’ test explained in our guide to tax-deductible business expenses in Malaysia.
Can you keep records digitally, and in which language?
Yes. Electronic records are acceptable provided you can produce them when LHDN asks, and records must be kept in English or Bahasa Malaysia. In practice, ‘producible’ means someone else could find and read the document years later:
- Scans and photos are legible: date, supplier, amount and description can all be read.
- Thermal-paper receipts are scanned soon after you receive them, before they fade.
- Files sit in folders by financial year and month, matching your accounting periods.
- Each file can be traced to its entry in the books, and each entry back to its file.
- There is a backup in a second location, and access is limited so files cannot be casually edited or deleted.
- Files will still open after a staff member leaves or a subscription changes.
If a supplier issues documents in another language, record the transaction in your books in English or Bahasa Malaysia and keep the original; ask your tax agent how they want such documents handled. Whether to keep paper originals of particular documents after scanning is also worth confirming against LHDN's latest guidance.
Do e-Invoices on MyInvois replace your own records?
No. A validated e-Invoice is held on IRBM's MyInvois system and carries a QR code or validation link, but it does not replace your own records. For every e-Invoice you issue or receive, keep:
- your own copy of the validated e-Invoice, with its QR code or validation link;
- the documents behind it, such as delivery orders, credit notes and the receipts behind a monthly consolidated e-Invoice;
- a link to the entry in your books, so the e-Invoice, the payment and the accounts agree.
A PDF invoice emailed to a customer is not an e-Invoice by itself; only the validated version is. Businesses exempt from e-Invoice (as of October 2026, those with annual turnover below RM3 million, subject to the related-company exclusions in our RM3 million exemption guide) still issue normal invoices and receipts and keep them for the full seven years. If you find e-Invoices that were missed or submitted wrongly since your mandatory date, review the e-Invoice voluntary disclosure programme (SVDP), open from 7 July 2026 to 31 December 2027, with your tax adviser.
What does a missing receipt cost? A worked example
Missing documents become extra tax when a deduction cannot be supported. Example: a Penang hardware trader, a Sdn Bhd paying the SME tax rates, claims RM36,000 of transport and repair costs for the year but can only find invoices for RM21,000.
| Item | Amount |
|---|---|
| Expenses claimed | RM36,000 |
| Supported by invoices | RM21,000 |
| Unsupported | RM15,000 |
| Extra tax if the RM15,000 is disallowed in the 17% band | RM2,550 |
| Extra tax if the income falls in the 24% band | RM3,600 |
That is before any penalty, and the same gap can repeat in every year under review. Fixing it at the time is much cheaper: ask the supplier for a copy invoice, keep the bank or e-wallet record of the payment, and fill in a payment voucher signed by whoever approved the spend. Be realistic, though: a self-prepared voucher may not be accepted as proof for tax, so treat it as a stopgap. Our guide to missing receipts and petty cash covers the details.
What should you do if your records are incomplete or behind?
Start now, before anyone asks, and work in this order:
- Download statements for every business bank account, e-wallet and merchant account for the periods you need to rebuild.
- Request copies of missing supplier invoices and statements of account; most suppliers can reissue them.
- Rebuild sales from invoices, POS reports and payment platform reports, and match them to deposits.
- Update the books month by month, oldest first, reconciling each bank account as you go.
- From then on, record each month's transactions well within the 60-day window and file documents as they arrive.
Mixing personal and business money makes this much harder, because every unexplained deposit has to be traced. If you are months or years behind, our guide to catching up a bookkeeping backlog sets out the full process, and our list of documents to give your bookkeeper shows what to collect each month.
How WeCount helps
WeCount records your transactions every month, reconciles each bank account and organises the supporting documents by period, so every entry can be traced to its invoice or receipt. Gaps are raised while suppliers can still reissue copies, and your year-end file is handed over in order to your accountant, tax agent or auditor. Regulated audit, tax-agent and professional accountancy services are delivered through appropriately authorised partners where required. See our monthly bookkeeping service or contact us to talk through your records.
Frequently asked questions
Can I throw away business records after 7 years?
Generally yes, once seven years have passed for that year's records and nothing is still open. Keep anything linked to a running loan, an asset you still own, a tax query or a dispute until the matter is closed. If in doubt, ask your tax agent before shredding or deleting anything.
Do I need to keep the original paper receipts after scanning them?
Electronic records are acceptable as long as they can be produced when LHDN asks, so clear, complete scans filed by month are generally fine. Scan thermal receipts quickly before they fade. For particular documents, such as signed contracts, check LHDN's latest guidance or your tax agent's preference before discarding the paper.
Do sole proprietors also have to keep records for 7 years?
Yes. The seven-year rule in section 82 of the Income Tax Act 1967 applies to businesses generally, not only to companies. A sole proprietor filing Form B needs the same invoices, receipts and bank statements to support the business income and expenses declared.
Is a bank statement enough proof of a business expense?
Usually not. A bank statement shows that money left the account, but not what was bought or why it was a business cost. Keep the supplier's invoice or receipt as well, and note the purpose where it is not obvious, so the expense can be supported if LHDN questions it.
How long should I keep e-Invoices?
Treat them like any other business record and keep them for at least seven years. Validated e-Invoices are on MyInvois, but save your own copy with the QR code or validation link, together with the receipts behind any consolidated e-Invoice, so you can produce everything from your own files.
Official sources
This guide is general information for Malaysian businesses as at the date shown. It is not tax, legal or audit advice. LHDN, SSM and JKDM rules change — check the latest official guidance or a licensed tax agent or auditor before acting. Regulated audit, tax-agent and professional accountancy services are delivered through appropriately authorised partners where required.
