Q: What is e-invoicing under the Goods and Services Tax (GST)?
A: E-invoicing under GST is a system where taxpayers generate invoices electronically on a government portal. It was initially introduced for taxpayers with an annual turnover of over Rs 500 crore from October 1, 2020.
Q: What is the recent change in the threshold for mandatory e-invoicing?
A: Starting from August 1, 2023, the Union government has extended e-invoicing to taxpayers whose aggregate turnover in any preceding financial year is Rs 5 crore or more. Previously, the threshold was a turnover of Rs 10 crore.
Q: What are the benefits of e-invoicing for businesses?
A: E-invoicing helps reduce mismatches in data reconciliation between sellers and buyers and curb fake invoicing. It also brings smaller businesses into the formal fold, streamlines their processes, enhances cash flow management, and fosters transparency in their operations.
Q: What challenges may small businesses face with the lowered e-invoicing threshold?
A: Small businesses may face an increased compliance burden due to the implementation of systems and processes for electronic invoicing, incurring additional costs.
Get a call back
Fill the below form to get free counselling for UPSC Civil Services exam preparation