E-Invoicing Turnover Limit is the base criteria on the basis of which a company falls under the E-Invoice Mandate. Recently, the government has further reduced the e-invoicing turnover limit covering companies with Annual Aggregate Turnover of Rs. 5 Cr. and above.
As per the GST notification 10/2023, from August 1, 2023 companies having AATO of Rs 5 Cr and above need to register their B2B invoices and other specific documents on IRP and get Invoice Registration Number in return. This is an attempt to accommodate MSMEs under e-invoicing and streamline the process while bringing in transparency and reducing tax evasion.
This article will help you to know if you have crossed the e-invoicing turnover limit and if you have recently crossed or are about to cross the e-invoicing threshold limit, then what are the next steps you need to carry from here on…
What is the turnover limit for e-invoicing?
Introduced in a phased manner, e-invoice under GST is based on the Aggregate Annual Turnover (AATO) of companies and businesses in India.
The first phase addressed companies with a turnover of over INR 500 crores. This went live from 1st October 2020. The next was for the ones that turned a revenue over of more than INR 100 crores. This went live from 1st January 2021. The third phase, which went live in April 2021, was for the companies with a revenue of over INR 50 crores. Earlier this year, the fourth phase, launched in April 2022, was effective for companies that have turnover over INR 20 crores. Finally, the fifth phase was for companies with a turnover of over INR 10 crores going live from 1st October 2022.
Here is a table for your reference, describing the GST notification number, the date applicable and the turnover criteria for e-invoicing under GST.
For a thorough update, take a look at the table below:
Steps to take after your business crosses the e-invoice turnover limit
1. Familiarize your Accounts Department with E-invoicing
Prior to the e-invoice applicability, all your B2B and B2C invoices may have had a similar common format that is followed by Indian businesses across the country with the required data fields. However, after crossing the e-invoicing turnover limit, you cannot carry out generating invoices in your usual manner. There is a standard procedure that needs to be followed. There are rules regarding the data fields and most importantly the IRN (Invoice Reference Number) and QR Code.
So, the first step will be to familiarize your accounts department with the e-invoicing mandate, its rules and regulations, about e-invoice printing, data fields etc. The change is massive and thus, a dynamic implementation will be made possible by having a thorough understanding of the e-invoice issuance, e-way bill production, and GST return filing processes.
2. Register yourself on the Invoice Registration Portal
Once your business crosses the e-invoicing threshold, you will automatically get enabled on the official GSTN portal. After the enablement, you need to register yourself on an IRP (Invoice Registration Portal) like IRIS IRP.
Note: In some cases, your business may not get automatically enabled on the official GSTN website. In that case, you need to create an account and enable yourself on the GSTN portal if your business falls under the e-invoicing threshold.
3. Verify and Prepare your Systems
Now that you have registered yourself on the invoice registration portal, it is also super important to check if your accounting and billing systems are ready for e-invoicing under GST. Before sending your invoice data to the IRP, you need to check if all the data is correct in order to avoid errors.
So, make sure your tax rates, HSN code etc. are updated in your systems. All the mandatory e-invoice data fields should be filled appropriately. Another major activity is that you will have to have a separate set-up for your B2B and B2C invoices. This is because e-invoicing is applicable to only B2B and export invoices so you must segregate your B2B and B2C invoices in your billing systems so as to avoid confusion.
4. Inform your Vendors and Customers about E-invoice Applicability
Once your business is applicable for e-invoicing, you need to also inform your customers and vendors about the same. From now on they will receive e-invoices from your end because your business has crossed the e-invoice turnover limit. This is an important change that will reflect on all your B2B invoices along with debit and credit notes. They also need to know in case of IRN cancellations if any. Your customers and vendors can verify if your e-invoice is valid by using apps like IRIS Peridot.
5. Find an E-invoicing Solution Provider
Now that you are all geared up and ready to initiate your e-invoicing journey, it is extremely important that you choose an efficient, ethical and transparent e-invoicing solution provider like IRIS IRP. IRIS IRP is an authorised Invoice Registration Portal by the government of India.
We at IRIS IRP operate at all levels. Not only will we take away all your hassle but will also ensure that you have an error-free IRN generation every single time. IRIS IRP will save you a lot of time, effort and resources without disturbing your current business flow.
With IRIS IRP, you can prepare a single e-invoice via our tool or bulk generate IRN through the excel utility, pull IRN in your ERP via API Integration or custom print invoices using an awesome cloud platform!
If you are a small business owner (MSME/SME): IRIS IRP helps you to jumpstart your e-invoicing using the offline excel utility tool i.e. MS Excel interface. You can send Invoice Data to IRP in bulk and generate e-invoices real-time! Also, get to generate e-invoices and e-way bills on a single platform.
If you are a large business owner: IRIS IRP E-invoicing is the best option for you - It is the fastest and easiest way to generate e-invoice. There are multiple options to generate IRN via IRIS IRP. You can integrate IRIS IRP APIs to get IRNs directly into your accounting system.
If you are a solution provider yourself: IRIS IRP calls all ERP providers and system integrators to design a seamless user journey for your customers using IRIS IRP to build a robust and error-proof e-invoice compliance. We offer Core and Enhanced APIs for e-invoice generation.