On 10th May 2023, the Central Board of Indirect Taxes and Customs (CBIC) notified the 6th phase of e-invoicing implementation. Which notified that all taxpayers with a turnover of ₹5 crore or more in any financial year from 2017-18 will be required to issue e-invoices from August 1, 2023.
As per the e invoice limit latest notification no. 17/2022 – Central tax from Government of India, dated 1st August 2022, the fifth phase of e invoice under GST is implemented with effect from 1st October 2022, where the GST taxpayers with aggregate turnover more than INR 10 crores should mandatorily generate e invoice for all their transactions.
Currently, under einvoice applicability 2022, businesses whose aggregate turnover is INR 20 crores and above should generate e invoice. With this reduction of aggregate turnover limit from INR 20 crores to INR 10 crores, it is evident that the government is taking steps to curb tax evasion by bringing transparency in the transactions that happen inside the business, avoiding manual errors, and automating filing processes to make businesses more compliant with the regulations.
Is e-Invoicing mandatory?
Yes, as per the e invoice turnover limit from April 2022 notification, e-Invoicing is already mandatory for the business exceeding a turnover of INR 20 crores from 1st April 2022. But, as per e invoice latest notification 2022, the turnover threshold has been minimized to INR 10 crores; indicating that e-invoicing will apply to businesses exceeding the turnover threshold of e invoice limit from Oct 2022. If the business falls under any of the above-said limits, the respective taxpayer must generate an e-Invoice by uploading all the invoices created in his ERP to the GST e-Invoice portal or generate an e-Invoice directly from the ERP if it’s capable of doing so.
What is the turnover limit for mandatory e-invoices?
Initially, when the e invoice was implemented on 1st October 2020, the e invoice limit to the GST taxpayer for the mandatory e-invoice generation was INR 500 Crores and above. After several phases of e-Invoice implementations, presently, as per einvoice applicability 2022, Notification No. 17/2022-Central Taxes dated 01-08-2022, E-Invoicing is mandatory for GST taxpayers whose aggregate turnover is more than INR 10 crores with effect from 1st October 2022.
Aggregate turnover includes all types of outward supplies (sales or services), whether it is B2B or B2C, SEZ or Exports, Taxable or Exempted, everything put together needs to be accumulated to check the turnover limit for applicability.
History of e-invoicing
E invoicing in GST was first implemented on 1st October 2020 for businesses with a turnover of more than INR 500 crore, then in the second phase, it was reduced to INR 100 crore from 1st January 2021, followed by the third phase where it was reduced to INR 50 crore from 1st April 2021 and, in the fourth phase, it stood at INR 20 crore starting from 1st April 2022. Further as per the e invoice limit latest notification, the fifth phase has been implemented for businesses whose turnover exceeds INR 10 crore with effect from 1st October 2022.
|Phase||With effect date||Turnover criteria (INR)|
|1||1st October 2020||500 crores|
|2||1st January 2021||100 crores|
|3||1st April 2021||50 crores|
|4||1st April 2022||20 crores|
|5||1st October 2022||10 crores|
What happens if businesses exceeding 10 crores (e invoice limit from Oct 2022) don’t comply with the E-Invoice rule from 1st October 2022?
If the business whose aggregate turnover crosses INR 10 crores (e invoice limit from Oct 2022) and fails to generate the e-Invoices, then they will be penalized with 100% of the tax due or INR 10,000 whichever is higher.
Falling under the GST e-invoice mandatory rule and abiding by the regulation safeguards you from such a penalty. You can easily abide by these regulations and automate your e-Invoice generation with an ERP capable of generating e-Invoice right when an invoice is created.
Don’t google for the best e-invoice ERP. You will anyway see Gofrugal ERP there. Save your time and click below to get onboarded instantly and start generating e invoicing GST before it becomes mandatory for your business.
How to choose your e-invoicing software?
Before choosing the e-Invoicing software for your business, make sure it meets these benefits that help in easing your e-invoice generation process.
- Generate e-invoice instantly when a new invoice is created
- Maintain a complete record of IRNs generated to track anytime
- Smart validation of basic GST disclosures in the POS to avoid getting rejected from the e-Invoice portal
- Live tracking dashboard to track the entire journey of your transaction from invoice to E-Invoice along with the pending and failed updates
Why is Gofrugal the best e-invoicing software for all business types/sizes?
Gofrugal provides end-to-end solutions from POS Billing, E-invoicing, Inventory management, GST filing, and Accounting, all under one roof. Gofrugal e-Invoicing software has the ability to directly integrate with the GST E-Invoice portal, making your business easily abide by the e-Invoice regulation. Whether you are a small-scale or an enterprise business, Gofrugal’s e-invoice solution gives you the capability to perform all kinds of GST-related activities, from filing to e-invoicing without any restrictions.
Interested in knowing whether Gofrugal can assist you in complying your business with the e invoicing in GST mandatory regulation? Try our e-invoice software trial free for 30 days and experience it yourself!