New Delhi: Do you own a business that has an annual turnover exceeding Rs 5 crore? This news is for you. The GST Council has now made it mandatory for all businesses with turnover exceeding Rs 5 crore to move to e-invoicing under goods and services tax (GST) from January 1.
The GST Council is planning to bring all the businesses with turnover exceeding Rs 1 crore by the next fiscal year. The move aims at plugging the revenue leakage and improving compliance.
What Is E-Invoicing?
e-Invoice is a system in which B2B invoices are authenticated electronically by GSTN for further use on the common GST portal. Under the electronic invoicing system, an identification number will be issued against every invoice by the Invoice Registration Portal (IRP) to be managed by the GST Network (GSTN).
Benefits of e-Invoice
- Helps organizations streamline their invoice processing cycles
- Reduces the man-hours required for invoice processing, approving, tracking, and chasing invoices
- Helps avoid mistakes caused by human errors
- Easy to track
The Council has asked the technology providers to ensure that the portal is ready by December to handle the increased traffic. The GST Council had decided to implement electronic invoices in a phased manner. The aim is to bring all the small businesses under the formal economy.
The Council made it mandatory for all businesses having aggregate annual turnover of Rs 10 crore and above to move to e-invoicing for business-to-business (B2B) transactions from October 1.
