February 20, 2023

E-Invoice Under GST Regime

The introduction of Goods and Services Tax (GST) in India has been one of the most significant tax reforms in the country's history. GST has replaced a plethora of indirect taxes and has brought uniformity in the taxation system. The introduction of e-invoicing under GST is the latest development that aims to streamline the invoicing process and reduce the compliance burden on businesses. In this article, we will discuss everything you need to know about e-invoicing under GST regime.

What is e-invoice under GST regime?

E-invoice under GST regime is a process of electronically generating invoices for business-to-business (B2B) transactions. It is a new system that was introduced by the Government of India to simplify the invoicing process and reduce the compliance burden on businesses. Under this system, businesses are required to generate invoices in a standard format and upload them to a central portal. The invoices are then verified by the GST Network (GSTN) and a unique Invoice Reference Number (IRN) is generated. The IRN is a unique identifier that is assigned to each invoice and is used to track the invoice throughout its lifecycle.

How does e-invoicing work under GST?

The e-invoicing process under GST involves the following steps:

1. The supplier generates the invoice in a standard format and uploads it to the e-invoicing portal.

2. The invoice is verified by the GSTN, and a unique IRN is generated.

3. The supplier shares the invoice with the recipient, either through email or any other electronic mode.

4. The recipient can view the invoice and download it for their records.

5. The invoice details are auto-populated in the recipient's GST return, making the process faster and more accurate.

Who needs to generate e-invoices under GST?

As per the latest notification issued by the Government of India, businesses with an annual turnover exceeding Rs. 50 crores are required to generate e-invoices for B2B transactions. This rule is applicable from 1st April 2021. However, businesses that do not meet this turnover threshold can also opt for e-invoicing voluntarily.

What are the benefits of e-invoicing under GST?

E-invoicing under GST offers various benefits to businesses, such as:

1. Reduced errors: E-invoicing eliminates the chances of errors that may occur during manual data entry.

2. Streamlined process: E-invoicing simplifies the invoicing process and reduces the compliance burden on businesses.

3. Faster processing: E-invoicing enables faster processing of invoices, reducing the time taken for payment settlement.

4. Improved data accuracy: E-invoicing ensures accurate recording and reporting of invoice data.

What is the penalty for non-compliance with e-invoicing under GST?

Businesses that are required to generate e-invoices but fail to do so can face penalties under the GST regime. The penalty for non-compliance is Rs. 10,000 or the tax amount involved, whichever is higher. Therefore, it is essential for businesses to comply with the e-invoicing rules to avoid penalties.


E-invoicing under GST is a new initiative that aims to simplify the invoicing process and reduce the compliance burden on businesses. It is a step towards making the taxation system more efficient and transparent. As a business owner, it is essential to comply with the e-invoicing rules to avoid penalties and take advantage of the benefits offered by the system.


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