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e Invoicing applicability

Latest update on e-Invoicing applicability


e-Invoicing applicability update : Recently, the e-Invoice portal of the Government of India has enabled an option for sandbox testing for businesses whose turnover falls in the bracket of 50 Cr. – 100 Cr.

e-invoicing


This move indicates that the GST Council may soon start applying e-Invoicing system to the businesses falling under this turnover bracket.

It is most likely that the applicability date of the same will be 1st April 2021 however, there has been no official notification released by the Government about it.

Now generate e-Invoices from your ERP with just 1-click!

Introduction to e-Invoicing applicability

e Invoicing under GST has rolled out for all businesses having an annual aggregated turnover of INR 500 Crores & above.

The government has also released the notification that e Invoicing will expand to businesses with an annual aggregated turnover of INR 100 Crores & above from January 2021.

e-Invoicing applicability will mainly apply to B2B Invoices, but the applicability of this new provision is variable.

 In this article, we have explained in detail, as to which businesses and documents are exempted & eligible from e Invoicing under GST.

Watch our exclusive video on e-Invoice generation

What is e Invoicing under GST?

e invoicing software

e Invoicing under GST is the practice of generating invoices in a specified format given by the government- SCHEMA.

These invoices then need to be uploaded to the IRP, which will validate the GST e invoicing means for errors & duplicity.

Mentioned below are the documents & Businesses that are liable to e Invoicing GST applicability limit.

Upon successful validation, the IRP will generate unique IRNs & QR codes for the invoices & store them for 24 hours.

The IRP will share the e-Invoice data with the e-Way Bill Portal & the GST Portal to auto-populate the e-Way Bills & GST Returns.

e invoicing in GST is limited to B2B Invoices, for now, however, businesses will also have to create QR Codes for B2C Invoices.

e-Invoicing applicability is variable to different types of documents & businesses.

e-Invoicing Applicability- Documents & Businesses

e Invoicing is applicable to all businesses that have an annual aggregated turnover of Rs. 500 Crores & above, unless the government exempts them specifically.

These businesses will have to declare the following documents on the IRP, without fail-

  1. B2B Invoices
  2. B2G Invoices
  3. RCM invoices
  4. Export Invoices
  5. Credit Notes
  6. Debit Notes
  7. QR Codes for B2C Invoices (Not in function currently)

Recently, the government has rolled out a notification that states that   gst invoicing rules or  gst e Invoicing  will apply to all businesses with an annual aggregate turnover of Rs. 100 Crore+ from January 1st, 2020.

As per sources, this is around the same time, when B2C Invoices & QR Codes will also be included in e invoice under GST, mandatorily.

Businesses exempted from e-Invoicing applicability

Since e Invoicing is a B2B based process most companies dealing in B2C transactions and minimum turnover for GST as a prime portion of the nature of their business are exempted from e-Invoicing applicability.

Banks, Financial Institutes, Airlines, Telecommunication companies, & other institutes that deal with customers directly, irrespective of the size of the enterprise, are exempted from e Invoicing.

Additionally,

  1. The SEZ (Special Economic Zone) & FTWZ (Free Trade & Warehousing Zones) Units are also exempted from e Invoicing.
  2. All registered persons providing services of – admission to an exhibition of cinematograph films in multiplex screens are also exempted from e Invoicing applicability of GST as per the CBIC Notification.
  3. Goods Transport & Agency (GTA) transporting goods by road in a goods carriage.
  4. Transport service providers, providing passenger transportation services are also exempted from generating e-Invoices.

Here are other cases that are exempted from e Invoicing under GST  (GST exempted category )as per CBIC notification-

Input Service Providers

Supplies Received from unregistered person

Supplies Received through the import of services

Bills of Supplies

Import Bills of Entry

B2C Invoices

Small & Medium Businesses- applicability of GST e Invoicing, for now, will only apply to large enterprises having an annual aggregated turnover of Rs. 50 crores and above (until stated otherwise)

Conclusion:

On a conclusive note e-Invoicing will benefit businesses in more than one ways, and make e invoicing GST India simpler for more than one provisions of GST.

However, e invoice GST itself is an additional compliance burden that may increase the work of accountants of a company.

The Government has offered many alternative solutions to make e-Invoicing simpler for businesses to comply with such as APIs, GSPs & ASPs.

GSP being the most reliable solution for e-Invoicing, businesses must choose the best & most relevant one for their business.

GSTHero is one of the best & most recommended GSPs in the market for its reliability & ever-updating features.

Here is why GSTHero is the best e-Invoicing Solution for your Business-

  1. Simple integration
  2. Data Security
  3. Direct integration with the IRP
  4. Scalable for high data volume
  5. Highly Automated- requires minimal human input
  6. Reduced Errors with automation
  7. Enhanced productivity of your accounts team
  8. Compliance in real-time
  9. Bulk Operations- Generate, cancel, print, validate & edit e-Invoice in bulk within the ERP
  10. Achieve 100% Compliance with e-Invoicing
  11. Cost-effective

About the author

Gaurav is an Engineer by training with a deep interest in Economics & Finance. He has been associated with the Fin-Tech industry for quite some time now. He writes for GSTHero for topics including GST Compliance, GST Structure, etc & aims to break down complicated technical jargon into simple terms for the taxpayers. His expertise includes GST Laws, Corporate Finance & Macro-Economics.

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  1. Dear sir,

    1- is it necessary to post RCM invoice also through irp?
    2- Export Invoice – It is informed that from e invoice the data's will be uploaded to GSTR1 for export too. Assume that i am clearing an export invoice with current exchange rate, being routed through IRP that details will come and sit under GSTR1. But the actual clearance may happen after a couple of days or aftera week. in such situation the Exchange rate may got changed and the shipping bill value and tax will be different from that of invoice. for rebate purpose the actual igstv tax rate and value of shipping bill should match with gstr1 else the rebate will be denied. how to overcome this? pl mail to me

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