A new GST rule has become mandatory for businesses with an annual turnover of Rs 100 crore from May 1, 2023. All such firms will have to upload their electronic invoices on the Invoice Registration Portal (IRP) within seven days of the issue of such invoice.
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The IRP is used for validating if invoices are actually genuine. It is used to generate and assign a unique Invoice Reference Number to every GST invoice.
The GST Network (GSTN) has said the government has decided to impose a time limit on reporting old invoices on the e-invoice IRP Portals for taxpayers with an aggregate annual turnover greater than or equal to Rs 100 crore.
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“To ensure timely compliance, taxpayers in this category will not be allowed to report invoices older than 7 days on the date of reporting.” In order to provide sufficient time for taxpayers to comply with this requirement, this new format would be implemented from May 1, 2023,” stated the GSTN advisory.
It noted that this restriction will apply to invoices and that there will be no time restriction on reporting debit/credit notes.
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To demonstrate how the new process will work, the GSTN said if an invoice has a date of April 1, 2023, it cannot be reported after April 8, 2023. This is because the validation system built into the IRP will not allow users to report the invoice after the 7-day period.
Therefore, it is essential for all eligible businesses to report the invoice within the 7-day window, added the GSTN.
According to GST law, businesses cannot get an input tax credit if invoices are not uploaded to the IRP.
Experts feel that the new rule will help the government stop backdating e-invoices by large companies. There are chances that the government may extend the rule to other companies with lower turnover in the future.
EY Tax Partner Saurabh Agarwal was quoted in a PTI report saying that the implementation of timelines for reporting invoices on the IRP would help in administering compliance and is another “great move” towards digitalization.
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“This may also aid in increasing the GST collection once the said limit of ₹100 crore turnover is reduced significantly or is made mandatory for all assesses required to generate IRN (Invoice Registration Number),” Agarwal told the news agency.
