Pawnshop Owners, Here's What LHDN's Latest E-Invoice Update Means for You

Malaysia's Inland Revenue Board, has added new guidance on how e-Invoices apply to pawnbroking transactions. This forms a new section in the e-Invoice FAQ for financial services, updated on 26 August 2026.

Pawnbrokers do not need to issue an e-Invoice for the loan principal itself. An e-Invoice is required, however, for the ticket fee charged and for interest charged when a pledge is redeemed or renewed.

If a pledged item worth RM200 or below is not redeemed in time, ownership passes automatically to the pawnbroker without an auction. The pawnbroker must then issue a self billed e-Invoice for taking ownership of that item.

For items worth more than RM200, unredeemed goods are sold through auction. If the pawnbroker buys the item itself, it must issue a self billed e-Invoice for the purchase, plus a separate e-Invoice for any interest and other charges. If a third party wins the auction instead, that bidder issues the self billed e-Invoice, while the pawnbroker still issues the e-Invoice for interest and charges.

Where an auction raises more money than what is owed, the surplus is held in trust for the borrower. No e-Invoice is needed while holding this surplus, returning it to the borrower, or handing unclaimed surplus to the Accountant General's Department.

When a pawnbroker later resells an item it had taken ownership of, it must issue an e-Invoice on request, or a receipt if none is requested, following the usual consolidated e-Invoice process.

Lastly, no e-Invoice is required for year end accrued interest recognised on unredeemed pawn loans, since this is only an accounting entry and not an actual transaction.

If you wish to focus on running and growing your business, our CFO advisory team can take care of your accounting, payroll, tax planning, e-stamping, corporate secretarial and compliance matters for you. Feel free to WhatsApp us at 010-246 2151.