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E-invoice GST limit has been a hot topic in the GST world. The government is attempting to accommodate MSMEs through e-invoicing. Finance department issues several circulars and GST notices for the smooth implementation of electronic billing in the country. So if you’re wondering if your business has crossed the e-invoicing threshold, you’ve come to the right page.

What is the limit for e-invoice?

Any GST-registered taxpayer whose turnover in any of the financial years from 2017-2018 exceeds INR 500 crores must implement an electronic invoicing mechanism from 1 October 2020. 

In addition, any taxpayer with a turnover exceeding Rs 100 crore in any financial year 2017-2018 will have to implement this new invoicing system from 1 January 2021. The electronic invoicing system requires taxpayers to create invoices in their internal system and submit them to the Invoice Registration Portal (IRP).

Who is exempted from e-invoicing?

E-invoice does not apply to the following category of persons irrespective of turnover:

  • Special Economic Zone units
  • An issuer
  • An NBFC
  • A Goods Transport Agency
  • A banking company 
  • A financial institution
  • A person supplying passenger transportation services
  • A person who provides admission services to the cinematographic films exhibitions in multiplex services.

What is the minimum amount for an invoice?

A tax invoice is not required when the value of the goods or services supplied is less than INR 200, if –  

  • Recipient is not registered and 
  • Recipient does not request an invoice, however, if the recipient requests one, one should be issued.

What is the penalty if an e-invoice is not generated?

The penalties for failing to generate an e-invoice are as follows:

Penalty for non-issuance of invoice: Each instance of non-compliance will result in a fine of 100% of the tax due or INR 10,000 (whichever is greater).

Penalty for incorrect invoice: The e-invoice penalty will be INR.25,000.

For transportation of goods without a valid invoice, the department has the authority to seize both the goods and the vehicle. A penalty may be imposed in this case.

E-Way Bill (EWB) generation will be impossible without a valid IRN. This may result in additional penalties (related to EWBs).

However, by taking the following precautions, you can avoid the penalties for a second e-invoice.

  • Once the IRN is generated, the e-invoice cannot be changed. You can only cancel the wrong e-invoice.
  • If you exceed this limit, you must create credit and cancel your e-invoice.

How can I modify my e-bill after 72 hours?

After 24 hours, the recipient of the consignment can cancel an e-Way Bill at the request of the consignor. After 72-hour window, there is no procedure for cancelling an e-Way Bill.

FAQ

Is e-invoicing mandatory for turnover above 5 crores?

E-invoicing is mandatory for taxpayers with turnover between Rs. 5 Cr. and Rs. 20 Cr.

Is e-invoice mandatory for B2B?

For all B2B transactions, businesses with a turnover of Rs 20 crore or more must mandatorily generate an electronic invoice.

Is e-invoice mandatory for B2C?

B2C invoices are exempt from electronic invoicing.

Can we cancel the e-invoice after 24 hours?

There is no provision for the cancellation of Electronic invoices after 24 hours.

Can I generate an e-invoice after the invoice date?

There is no time limit for making electronic invoices under the law. You can create an e-invoice within days of your B2B invoice date.

Is a Signature mandatory on an e-invoice?

Supplier or its authorized representative must sign/digitally sign e-invoices

Can the e-invoice be edited?

If an electronic invoice contains errors, inaccuracies, or incorrect entries, then is no option for edition or correction. Your only option is to cancel this invoice/IRN, upload a new invoice (with a new number) and generate a new IRN.

Is e way bill required for an invoice value less than 50000?

No requirement for an e-way bill if the invoice value is less than Rs.50,000.

Wrapping UP

Electronic invoices are an important aspect of India’s GST rules for B2B businesses.

The agency responsible for e-invoicing is the GST Council accompanying the Central Indirect Taxes and Customs Council. E-invoicing can be a laborious process. If you need assistance with e-invoice to enable GST compliance features, contact InstaFiling right away.

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