📄 What is E-Invoicing under GST? A Simple Guide for 2025

With the rise of digital tax compliance in India, E-Invoicing under GST has become one of the most significant reforms for businesses. It aims to automate reporting, reduce fraud, and make GST return filing easier.

In this blog, we’ll explain:

• What is e-invoicing?
• Who is required to generate e-invoice in 2025?
• How to generate it?
• Benefits & penalties
• Common FAQs

✅ What is E-Invoicing?

E-Invoicing or Electronic Invoicing is a system under GST where B2B invoices are electronically authenticated by the Invoice Registration Portal (IRP). A unique Invoice Reference Number (IRN) and QR code is generated, which becomes part of the official GST invoice.

Note: E-invoicing does not mean generating invoice on the GST portal. Instead, you generate it through your software, and it's validated through the IRP.

👥 Who is Required to Generate E-Invoice in 2025?

As per the latest GST notification, e-invoicing is mandatory for businesses having:

Aggregate Turnover	E-Invoicing Applicability
Above ₹5 crore	✅ Mandatory from 1 August 2023 onwards
Below ₹5 crore	❌ Not applicable (voluntary option may be given in future)

Turnover is calculated PAN-based, not GSTIN-wise.

🔍 Example:

XYZ Pvt. Ltd. has 2 branches:

• Delhi branch turnover = ₹3 crore
• Mumbai branch turnover = ₹3 crore
  ➡️ Total PAN turnover = ₹6 crore
  ✅ E-invoicing is mandatory

🧾 Which Invoices Are Covered?

You must generate e-invoice for:

• B2B invoices (business-to-business)
• Export invoices
• Credit/Debit Notes related to B2B supplies

📌 Not applicable for:

• B2C invoices
• Composition dealers
• SEZ units (in some cases)
• Non-GST supplies

❌ Who Need NOT Comply with E-Invoicing (Exempted Persons)

As per GST Notification No. 13/2020 – Central Tax, dated 21st March 2020, and updates thereafter, the following persons are exempt from e-invoicing, regardless of turnover:

✅ 1. SEZ Units

Only SEZ Units are exempt. SEZ Developers are NOT exempt.

✅ 2. Banks and NBFCs

Includes all scheduled and non-scheduled banks, financial institutions, and non-banking financial companies (NBFCs).

✅ 3. Insurance Companies

E.g., LIC, ICICI Prudential, HDFC Life, etc.

✅ 4. Goods Transport Agencies (GTA)

Providing transport services for goods.

✅ 5. Passenger Transportation Services

E.g., Airlines, railways, bus operators, cab aggregators, etc.

✅ 6. Cinematograph Film Exhibitors

Providing services by way of exhibition of films in multiplex screens.

✅ 7. Government Departments & Local Authorities

Central and State Government departments, municipalities, panchayats, and other local authorities are exempt.

✅ 8. UN & Embassies

Entities covered under Section 55 of CGST Act (like UN bodies, foreign embassies).

⚙️ How to Generate an E-Invoice?

Here's a simple 5-step process:

✅ Step 1: Prepare the invoice

Generate invoice from your ERP/software in JSON format.

✅ Step 2: Upload to IRP

Use GSP/API/portal to upload JSON file to the Invoice Registration Portal (IRP).

✅ Step 3: IRN Generation

IRP verifies and generates a unique IRN (Invoice Reference Number).

✅ Step 4: QR Code & Digital Signature

IRP adds QR code and digital signature to the invoice.

✅ Step 5: Download and share

Download signed invoice and share with buyer.

📦 Integration with GSTR-1 and E-Way Bill

• Once the invoice is validated by IRP, details auto-populate in GSTR-1
• Part A of E-way bill is also auto-filled (if applicable)

This saves manual entry and reduces mismatches.

🎯 Benefits of E-Invoicing

• 🔒 Reduces fake invoices and fraud
• 🔄 Auto-populates GSTR-1 & E-way bill
• ⏱️ Saves time and effort in compliance
• 📉 Reduces mismatches in returns
• 📁 Improved transparency and audit trail

⚠️ Penalty for Non-Issuance of E-Invoice

If applicable and not issued:

• 📄 Invoice is not treated as valid under GST
• 💰 Penalty = ₹10,000 per invoice (Section 122 of CGST Act)
• 📉 May lead to denial of input tax credit (ITC) to buyer

❓ Common FAQs on E-Invoicing

Q1. Is e-invoice applicable to service providers?

✅ Yes, if turnover exceeds ₹5 crore.

Q2. Is it needed for exports?

✅ Yes. Export invoices are treated like B2B invoices.

Q3. What happens if IRN is not generated?

❌ Invoice is invalid, and ITC may be denied to the recipient.

Q4. Can e-invoice be cancelled?

✅ Yes, within 24 hours of IRP generation.

Q5. Do I need to print QR code on invoice?

✅ Yes. The invoice shared with the buyer must contain the IRN and QR code.

📝 Conclusion

E-Invoicing is the future of GST compliance. It reduces human errors, enhances transparency, and brings your business closer to real-time tax reporting.

If your business turnover exceeds ₹5 crore, ensure you're e-invoice compliant now.

💼 Need Help Setting Up E-Invoicing?

Let Kumar Ravi & Company assist you in:

✅ E-Invoicing setup

✅ Software integration

✅ GST return filing

📩 Email: ravikumarshah542@gmail.com

🌐 www.raviandcompany.com

📞 Call/WhatsApp: +91-7004361367

👉 Contact us now to connect with our expert team. We're here to guide you step-by-step!