E-invoicing for businesses having turnover more than INR 5 crore from next year
E-invoicing for businesses with aggregate turnover exceeding INR 5 crore will be mandatory from next year. At present, the threshold is INR 20 crore, which is going to come down to INR 10 crore from October 1.
“The system is ready to facilitate e-invoicing for threshold of over INR10 crore. Our effort is to lower the threshold to INR 5 crore from next year for which a notification prescribing the exact date is to be issued later,” a senior Government official told BusinessLine.
E-invoicing prescribes a standardised format of an invoice that a machine can be read. Here, an identification number is issued against every invoice by the invoice registration portal (IRP) to be managed by the GSTN. Businesses for which e-invoicing is mandated and if they do not, their invoice will not be valid. In such a situation, input tax credit (ITC) on the same cannot be availed by the recipient, besides attracting applicable penalties.
Tax officials say businesses use various accounting/billing software, generating and storing invoices in their electronic formats. These different formats are neither understood by the GST system nor among the systems of suppliers and receivers. For example, an invoice generated by the SAP system cannot be read by a machine using the ‘Tally’ system, unless a connector is used. With more than 300 accounting/billing software products, there is no way to have connectors for all. In this scenario, ‘e-invoicing’ aims at machine-readability and uniform interpretation.
