E-Invoice Generation Becomes Mandatory
Businesses having a turnover of more than Rs.20 Cr will now have to generate E-Invoices or Electronic Invoices for B2B transactions. This rule has now become mandatory from April 1, as said by the Central Board of Indirect Taxes and Customs.
Under the Goods and Service Tax (GST) law generating e-invoices for B2B transactions became mandatory for businesses having turnover more than 500 crores from October 1, 200. After that, this rule was made applicable for businesses having a turnover of more than Rs.100 crore from January 1, 2021.
Further, under the GST law, businesses with a turnover of more than Rs.50 crore were advised to generate e-invoices.
Simplifying The Process
Tax Partner, EY India, Bipin Sapra said, “By making it mandatory for all assesses whose turnover is more than ₹20 crores to issue e-invoice, the Government has taken the compliance automation to a larger set of taxpayers, which will not only simplify compliance but also further plug revenue leakages on account of input tax credit frauds.”
Generating e-invoices has many benefits which simplify the GST system. Electronic invoicing provides a standard format that makes online systems check them easily. With this B2B invoices can be examined and authenticated electronically on the GST portal. To manage GSTN, Invoice Registration Portal (IRP) provides each B2B invoice with a unique identification number.
What If Businesses Don’t Generate E-Invoices?
If e-invoices are not generated by a business, then it may result in attracting penalties. The heavy penalty of Rs.10000 per invoice will be applicable for non-compliant businesses. And inaccurate invoices will attract the penalty of Rs.25000 per invoice.
Results Of Delay In Generating E-Invoices
- GST returns will not be able to be auto-filled.
- You cannot claim eligible ITC.