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The Central Board of Direct taxes and Customs (CBIC) has made the e-invoicing system mandatory for taxpayers with a turnover higher than Rs.50 crore from 1st April 2021.
The government extended the e-invoicing applicability to businesses having more than Rs.20 crore turnover w.e.f 1st April 2022. From 1st October 2022, the limit has been revised to Rs.10 crore. The GST Council plans to implement the sixth phase of e-invoicing for businesses with an annual turnover of Rs.5 crore or more from 1st January 2023. It may also be extended to those with a turnover of more than Rs.1 crore in the next fiscal year.
26th December 2022
The CBIC has clarified that there is no proposal before the GST Council and no plans of the government to implement the next phase of e-invoicing for those businesses with turnover over Rs.5 crore from 1st January 2023.
11th October 2022
The GST Council may implement the next phase of e-invoicing for businesses with an annual turnover of more than Rs.5 crore from 1st January 2023. The system may get extended to businesses with a turnover of over Rs.1 crore by the end of the next fiscal year.
1st August 2022
The e-Invoicing system for B2B transactions has now been extended to those with an annual aggregate turnover of more than Rs.10 crore up to Rs.20 crore starting from 1st October 2022, vide notification no. 17/2022.
The government-mandated e-invoicing to avoid GST tax evasion. The first Committee was set up in May 2019 to discuss the usability of e-invoicing and its implementation plan in India, considering global implementations. Since then, several drafts were issued, and finally, the e-invoice schema was introduced in January 2020. E-invoicing was supposed to be mandatory from 1st April 2020 but was later pushed by the GST Council, and finally, it became live from 1st October 2020 in a phased manner.
In the first phase, companies with turnover higher than Rs.500 crore had to issue e-invoices from 1st October 2020. In the second phase, companies with turnover greater than Rs.100 crore had to issue e-invoices from 1st January 2021. In the third phase, companies with turnover higher than Rs.50 crore must issue e-invoices from 1st April 2021.
In the fourth phase, the government mandated that companies with a turnover of more than Rs 20 crore to issue e-invoices from 1st April 2022. In the fifth phase, the system applies to those businesses with a turnover of more than Rs.10 crore to begin e-invoice generation from 1st October 2022.
|Notification No. 13/2020 dated 21st Mar 2020||E-invoicing was made mandatory for businesses with turnover higher than Rs.100 crore in a year.|
This was put to effect from 1st October 2020.
|Notification No. 60/2020 dated 30th Jul 2020||A new e-invoice format was notified with 20 new fields, and 13 fields were removed.|
|Notification No. 61/2020 dated 30th Jul 2020||The turnover limit was increased from Rs.100 crore to Rs.500 crore to restrict the applicability.|
|Notification No. 70/2020 dated 30th Sep 2020||Amendment in original notification 13/2020 by changing the determination of turnover from current FY to turnover of any preceding FY from 2017-2018.|
|Notification No. 88/2020 dated 10th Nov 2020||Change in original notification 13/2020 to restore the turnover limit to Rs.100 crores from Rs.500 crore.|
|Notification No. 05/2021 dated 08th Mar 2021||Change in original notification 13/2020 to decrease the turnover limit to Rs.50 crore from Rs. 100 crore to extend the applicability to more taxpayers.|
|Notification 23/2021 on 1st June 2021||Extension of exemption to government departments and local authorities.|
|Notification 01/2022 on 24th February 2022||Change in original notification 13/2020 to further reduce the turnover limit to Rs.20 crore from Rs.50 crore to extend the applicability to more taxpayers.|
|Notification 17/2022 on 1st August 2022||Change in original notification 13/2020 to further reduce the turnover limit to Rs.10 crore from Rs.20 crore to extend the applicability to more taxpayers.|
Businesses will now have to get their systems integrated with the government’s invoice registration portal for a seamless generation of Invoice Reference Number (IRN) for every B2B invoice. They will also have to make changes in their accounting software to comply with the e-invoice schema. Generating e-invoices will impact the business processes as follows-
Non-generation of e-invoice is an offence and attracts penal provisions. It attracts heavy penal provisions of up to Rs.10,000 per invoice. Further, incorrect invoicing can lead to a penalty of Rs.25,000 per invoice.
Other than penal provisions, if a taxpayer delays in generation of e-invoice-
NIC has issued the below guidelines for the taxpayers whose turnover exceeds Rs.50 crore:
There are several ways in which the taxpayer’s system can interact with the IRP for IRN generation:
E-invoice is a new concept in India. Thus, businesses will have to take certain steps for the smooth implementation of e-invoicing: