Is your business worth more than Rs 5 crore a year? You need to know this. As of January 1, all businesses with a turnover exceeding Rs 5 crore must use e-invoicing under the goods and services tax (GST).
Businesses with turnover over Rs 1 crore will be brought under GST by the next fiscal year, according to the GST Council. In addition to improving compliance, the move aims to plug revenue leaks.
E-Invoicing: What Is It?
In e-Invoices, B2B invoices are authenticated electronically by GSTN for further use on the common GST portal. The GST Network (GSTN) will manage the Invoice Registration Portal (IRP) that will issue identification numbers against each invoice under the electronic invoicing system.
The benefits of e-invoicing
- Streamlines invoice processing for organizations
- Reduces the time needed to process invoices, approve them, track them, and chase them
- Prevents human error-related mistakes
To handle the increased traffic, the Council has asked the technology providers to ensure the portal is ready by December. Electronic invoices will be phased in by the GST Council.Small businesses are to be brought under the formal economy.
On October 1, all businesses with aggregate annual turnover of Rs 10 crore and above will be required to use e-invoicing for business-to-business (B2B) transactions.