The Government has set a seven-day timeline to report old invoices on e-invoice IRP (Invoice Registration Portal) for tax assessees having annual turnover of ₹100 crore or more.

“In order to provide sufficient time for taxpayers to comply with this requirement, which may require changes to systems, we propose to implement it from May 01 onwards,” an advisory issued by GST Network (GSTN), the IT backbone of indirect tax system said. It clarified that to ensure timely compliance, taxpayers in this category will not be allowed to report invoices older than 7 days on the date of reporting.

Validation in portal

“Please note that this restriction will only apply to the document type invoice, and there will be no time restriction on reporting debit/credit notes,” the advisory said. For example, if an invoice has a date of April 1, 2023, it cannot be reported after April 8, 2023. The validation system built into the invoice registration portal will disallow the user from reporting the invoice after the 7-day window. Hence, it is essential for taxpayers to ensure that they report the invoice within the 7-day window provided by the new time limit.

The note further clarified that there will be no such reporting restriction on taxpayers with an annual turnover of less than ₹100 crore, as of now, the note mentioned.

According to Prateek Bansal, Tax Partner, White and Brief, Advocates & Solicitors, it becomes imperative for businesses to align issue of commercial invoices with that of e-invoices. This will help reduce mismatches between GSTR 3B auto generated data basis e-invoice on the GSTN portal with actual invoices issued during the month thereby resulting in a much accurate reporting. “It must not lose sight of that if invoice is not reported on IRP portal, it will be considered as non-issuance of invoice, and would attract penal consequences under the GST law,” he said.

e-invoice in GST

As per Rule 48(4) of CGST Rules, notified class of registered persons have to prepare invoice by uploading specified particulars of invoice (in FORM GST INV-01) on IRP and obtain an Invoice Reference Number (IRN). After following above ‘e-invoicing’ process, the invoice copy containing the IRN (with QR Code) issued by the notified supplier to buyer is commonly referred to as ‘e-invoice’ in GST. Because of the standard e-invoice schema (INV-01), ‘e-invoicing’ facilitates exchange of the invoice document (structured invoice data) between a supplier and a buyer in an integrated electronic format. ‘e-invoice’ in ‘e-invoicing’ doesn’t mean generation of invoice by a government portal.

It may be noted that under GST law, e-invoicing for business-to-business (B2B) transactions was made mandatory for companies with a turnover of over ₹500 crore from October 1, 2020, which was then extended to those with a turnover of over ₹100 crore, effective January 1, 2021. From April 1, 2021, companies with turnover of over ₹50 crore were generating B2B e-invoices, and the threshold was brought down to ₹20 crore beginning April 1, 2022. From October 1, 2022, the level was further lowered to ₹10 crore. Non-compliance could result in penalty.