Brief about E-invoicing under GST

Last updated: 02 April 2021

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Quick Summary

GST e-invoicing is a system where registered persons upload invoice details to the Invoice Registration Portal (IRP) to obtain an Invoice Reference Number (IRN) and QR code. This IRN is mandatory for a GST invoice to be valid. E-invoicing applies to businesses with an annual turnover exceeding certain thresholds, which have been progressively lowered since October 2020. Certain entities, such as SEZ units, insurers, and financial institutions, are exempt, as are B2C supplies, nil-rated, and exempt supplies.

As per Rule 48(4) of CGST Rules, notified class of registered persons have to prepare invoice by uploading specified details of invoice (in FORM GST INV-01) on IRP and obtain an IRN. The Invoice containing IRN (with QR Code) is commonly referred to as ‘e-invoice’ in GST

Note: A GST invoice will be valid only with a valid IRN.

1. Applicability: E-invoicing is applicable to the assessee having an aggregate Annual turnover above the limits mentioned below in any year since 2017-18.

Notification	Aggregate Annual Turnover	Effective Date
61/2020-CT 30-7-2020	Above 500 Cr.	1-10-2020
88/2020-CT 10-11-2020	Above 100 Cr.	1-01-2021
05/2021-CT 08-03-2021	Above 50 Cr.	1-04-2021

E-invoicing under GST: Rules, Applicability and Penalties

Note: SEZ units/Insurer/Banking Company /financial institution, including a NBFC/ GTA/ passenger transport service/services by way of admission to exhibition of cinematograph films in multiplex screens is exempted from GST e-invoicing mandate.

E-Invoice is not applicable for ISD invoices issued.

2, Who can issue GST Invoice – Supplier / E-commerce

3. Documents are covered under e-invoicing -Invoices/Debit Note /Credit Note

Note: Financial Debit Note / Credit Note / having no GST impact shall not be reported on IRP.

4. Supplies Presently covered under E-invoice-B2B/Supplies to SEZ/Exports/Deemed Exports.

Note: B2C/Nil rate/Exempt Supply is not covered under e-invoicing.

5. The column of other charges is not considered for Taxable turnover Therefore same can be used to show TCS/TDS. However other charges like Freight/Insurance/Packing & forwarding charges on which GST is applicable.

6. Minimum Penallty of Rs.10,000 for not issuing invoice in accordance with GST Law/rules (Sec.122 of CGST Act, 2017)

7. Amendments in E-invoice is not possible any changes if any can be carried out only in GSTR-1.

8. E-invoice can be cancelled within 24 hours from the time of reporting e-invoice. However if connected e-way bill is active or verified by officer during transit, cancellation of IRN will not be permitted. Further invoice needs cancelled toto partial cancellation is not possible in E-invoicing.