GST E-Invoicing in 2025 — Who Must Comply and How

Turnover thresholds have dropped. Most businesses are now covered.

The e-invoicing threshold is now ₹5 crore aggregate turnover. If you're still manually uploading invoices to the IRP, you're already non-compliant.

E-invoicing under GST has gone through four threshold reductions since its introduction in October 2020. As of 1 August 2023, the threshold is ₹5 crore aggregate turnover in any preceding financial year.

Current Applicability

Mandatory e-invoicing if: Aggregate turnover in any preceding FY from 2017-18 onwards exceeds ₹5 crore.

Note: It's any preceding year — not just the immediately preceding year. A business that crossed ₹5 crore in FY 2021-22 but has since dropped below still needs to comply.

Who Is Exempt

Even if turnover exceeds ₹5 crore, e-invoicing does not apply to:

• →SEZ units (not SEZ developers)
• →Insurance companies
• →Banking and financial institutions
• →GTA (Goods Transport Agency)
• →Passenger transportation services
• →Multiplex cinema services
• →B2C invoices (only B2B, exports, and SEZ supplies need e-invoicing)

How E-Invoicing Works

1. 1Business generates invoice in their accounting software
2. 2JSON is uploaded to the Invoice Registration Portal (IRP) — either directly or via API
3. 3IRP validates, generates IRN (Invoice Reference Number) and QR code
4. 4IRN is embedded in the invoice — without this, the invoice is invalid for ITC purposes

The IRP options: NIC (government), Cygnet, Clear, Masters India, and several others. Most accounting software now has direct IRP integration.

Impact on ITC for Recipients

If your supplier is mandatorily covered by e-invoicing but issues an invoice without an IRN, you cannot claim ITC on that invoice. The tax department can deny ITC even if you have paid GST — the invoice is non-compliant.

This means your vendor compliance is now your problem too.

Common Mistakes

1. Generating IRN after the invoice date

The IRP does not accept backdated invoices. IRN must be generated before or at the time of invoice issuance. Post-date generation causes mismatches in GSTR-1.

2. Cancelling and re-generating

An IRN can only be cancelled within 24 hours of generation. After that, a credit note is the only option.

3. Not embedding QR code correctly

The QR code must be printed/displayed on the physical or PDF invoice. Failure to do so is a violation even if the IRN was correctly generated.

4. B2B vs B2C confusion

E-invoicing is required only for B2B supplies. B2C invoices (final consumer) do not need IRN. But if a B2C invoice later needs to be amended to B2B, the original was non-compliant.

E-Way Bill Integration

Once an e-invoice is generated with an IRN, Part A of the e-way bill is automatically populated. You only need to add Part B (vehicle/transport details). This saves time but also means any error in the e-invoice flows into the e-way bill.

The complete e-invoicing episode — including IRP API setup, cancellation procedures, amendment workflow, and the 6 common audit flags — is Episode 10 of GST Mastery on MentorClub.

This was the free preview.

Full audio episode with worked examples, case law citations, and AI Mentor — ask your follow-up questions instantly.

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