At present, companies with turnover of Rs 10 crore and above are required to generate e-invoice
New Delhi:
Companies with turnover of over Rs 5 crore must generate digital or e-invoice for B2B transactions with impact from August 1.
At present, companies with turnover of Rs 10 crore and above are required to generate e-invoice for all B2B transactions.
The finance ministry by means of a notification dated Might 10 has notified a discount in threshold for e-invoicing. Efficient August 1, any taxpayer with turnover exceeding Rs 5 crore ought to increase e-invoices for B2B provides.
Deloitte India Companion Chief Oblique Tax Mahesh Jaising stated with this announcement, scope of MSMEs beneath e-invoicing can be expanded and so they might want to implement e-invoicing.
“For corporations e-invoicing is a boon quite than a bane as suppliers who’re e-invoicing compliant end in correct movement of enter tax credit score and cut back the churn round credit score points,” Mr Jaising added.
AMRG & Associates Senior Companion Rajat Mohan stated phased implementation of e-invoicing has resulted in lowered disruptions, improved compliance and elevated income.
E-invoicing was initially applied for giant corporations with turnover of greater than Rs 500 crore, and inside 3 years the edge has now been lowered to Rs 5 crore.
“Inclusion of MSME sector within the e-invoicing regime would profit the general enterprise ecosystem by decreasing prices, rationalising errors, making certain quicker bill processing, and in addition limiting business disputes in the long run,” Mohan added.
Underneath Items and Companies Tax (GST) regulation, e-invoicing for business-to-business (B2B) transactions was made obligatory for corporations with turnover of over Rs 500 crore from October 1, 2020, which was then prolonged to these with turnover of over Rs 100 crore efficient January 1, 2021.
From April 1, 2021, corporations with turnover of over Rs 50 crore have been producing B2B e-invoices, and the edge was introduced right down to Rs 20 crore starting April 1, 2022. From October 1, 2022, the edge was additional lowered to Rs 10 crore.
EY Tax Companion Saurabh Agarwal stated the trade must evaluation their vendor masters and be sure that any vendor supplying items or providers and crossing the edge turnover of Rs 5 crore is essentially issuing a e-invoice from August 2023 to keep away from any dispute with respect to availment of enter tax credit score (ITC).
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