The Goods and Services Tax (GST) Council, which oversees India’s GST regime, proposed on September 9, 2024, during its 54th meeting, a voluntary pilot for B2C transactions. If successful, this pilot will be mandated for all. The pilot will be rolled out in selected sectors and states, with an intermediate voluntary step.
India began mandatory B2B e-invoicing in October 2020, with a phased rollout. The current annual sales threshold for this mandate is ₹5 crore (INR 50 million or approximately US$600,000), last lowered in August 2023. This mandate requires invoices to be submitted to the Invoice Registration Portal (IRP) for validation and allocation of a unique code before being forwarded to customers. The launch date for the B2C pilot is likely to be 2026 or 2027.
GST Fraud Prevention: E-Way Bill and E-Invoice Checks Update
In January 2024, e-way bill with e-invoice checks were put on hold. Eventually, goods movements within India will require e-way bill electronic reporting and e-invoice details for B2B and export transactions. The National Informatics Centre, which operates the e-way bill portal, aims to reduce GST fraud by minimizing differences between the two reporting regimes.
The e-way bill is an electronic waybill for the movement of goods, including details such as the consignor, consignee, transporter, origin, and destination. GST-registered businesses cannot transport goods valued over ₹50,000 without an e-way bill generated on the government’s e-way Bill portal. B2C-related goods movements will not require e-invoice details on the e-way bill.
Taxpayers with an annual turnover exceeding ₹5 crore must provide at least a 6-digit Harmonized System of Nomenclature (HSN) code, while those with less than ₹5 crore need to provide at least a 4-digit HSN code.
E-Invoice Reporting: New 30-Day Deadline Imposed
On November 1, 2023, the GST Network (GSTN) imposed a 30-day e-invoice reporting deadline to the IRP. This deadline, originally intended to be 7 days, starts from the transaction date, not the receipt date. Initially, this applies to taxpayers with a turnover of ₹100 crore and above and includes credit or debit notes. Currently, taxpayers can include e-invoicing at the current date, with a limited legal definition of timescale.
April 2023: Option for voluntary GSTN e-invoicing
In April 2023, the GSTN opened its national e-invoicing registration portal (IRP) to all taxpayers for creating and sending electronic invoices. Currently, only taxpayers with ₹10 crore or above annual sales revenue are mandated to use the government’s e-invoicing system. Under GST law, businesses cannot avail input tax credit (ITC) if invoices are not uploaded on the IRP.
Indian B2C e-invoices
For B2C invoices, a QR Code must be included in any invoice by a mandated supplier. Indian e-invoicing is administered by the Central Board of Indirect Taxes & Customs (CBIC), which also oversees the operations of India’s Goods and Services Tax.
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