🧾 E-Invoicing Update 2025 – New Limits, Rules & Compliance Checklist

🔹 Introduction

The Indian GST system continues to evolve toward greater automation and transparency. One of the key reforms driving this change is e-invoicing — an electronic mechanism that validates B2B invoices through the Invoice Registration Portal (IRP).

As per the latest GST notifications (2025), the turnover threshold for e-invoicing has been further reduced, bringing more businesses into its ambit. For taxpayers, understanding the new applicability limit, process, and compliance checklist is crucial to avoid penalties and disruptions in invoice reporting.

This article provides a clear, updated guide on E-Invoicing under GST (2025) — who it applies to, how it works, and what steps you should follow for seamless compliance.

🔹 Legal Framework

E-invoicing is governed by:

• Rule 48(4) of the CGST Rules, 2017 – Mandates electronic reporting of invoices for specified taxpayers.

• Notification No. 13/2020–Central Tax, as amended from time to time.

• CBIC Notification (2025 Update) – Revised turnover threshold effective April 1, 2025.

• Section 31 of CGST Act, 2017 – Prescribes requirements for tax invoices.

📘 Objective:
To ensure real-time invoice authentication, reduce fake invoicing, and enable automated return and e-way bill generation.

🔹 Latest Applicability of E-Invoicing (April 2025)

As per the latest CBIC notification (effective 1 April 2025):

💡 Note:
The turnover is calculated PAN-based, not GSTIN-wise. So, if your business under one PAN crosses ₹5 crore (aggregate), all its GSTINs across India must comply.

🔹 Who Must Comply with E-Invoicing in 2025

✅ Businesses registered under GST with aggregate turnover exceeding ₹5 crore in any financial year since 2017–18.
✅ Applies to B2B, B2G, and export invoices.
✅ Also applies to credit notes and debit notes.

🚫 Exempted Entities:

• SEZ units (but not SEZ developers)

• Insurance, banking, and financial institutions

• Goods Transport Agencies (GTAs)

• Passenger transportation and cinema ticket services

🔹 How E-Invoicing Works – Step-by-Step Process

✅ Step 1: Generate Invoice in Your Accounting System

Prepare a standard invoice in your ERP/accounting software (Tally, Zoho Books, Busy, etc.) following the e-invoice schema (JSON format).

✅ Step 2: Upload to Invoice Registration Portal (IRP)

Your software or API integration uploads invoice data to the IRP for authentication.

✅ Step 3: IRP Verifies & Generates IRN

The IRP validates the invoice, assigns a unique Invoice Reference Number (IRN), and digitally signs it.

✅ Step 4: QR Code Generation

IRP returns the signed e-invoice along with a QR code containing invoice details and IRN.

✅ Step 5: Reported Data Flows to GST Portal

The invoice data automatically flows to GSTR-1 and E-way Bill system, reducing duplication.

🔹 Practical Example

Example:
M/s ABC Technologies (turnover ₹7.2 crore in FY 2023–24) must implement e-invoicing from 1 April 2025.
When they issue a B2B invoice for ₹1,00,000 + GST:

1. The invoice is generated in Tally.

2. Data uploaded to IRP → IRN generated instantly.

3. IRP returns a QR code → printed on invoice copy.

4. Data auto-populates GSTR-1.

📌 Result: Seamless integration with GST returns and reduced manual errors.

🔹 Common Mistakes in E-Invoicing

❌ Using old invoice formats without IRN/QR code.
❌ Not reporting invoices to IRP before dispatching goods.
❌ Duplicate uploads leading to multiple IRNs.
❌ Wrong turnover calculation (GSTIN vs PAN-based).
❌ Confusing e-invoicing with e-way bill generation — they are separate but integrated processes.

🔹 E-Invoicing Compliance Checklist (2025 Edition)

✅ Verify if your turnover exceeds ₹5 crore (PAN-based).
✅ Configure ERP/accounting software for e-invoice JSON format.
✅ Integrate with IRP through API or GSTN-recognized GSP.
✅ Update invoice templates to include IRN and QR code.
✅ Train your accounts and billing teams on the workflow.
✅ Conduct a trial run before the effective date.
✅ Regularly reconcile IRP data with GSTR-1 to avoid discrepancies.

🔹 Penalties for Non-Compliance

As per Section 122 of the CGST Act, 2017:

• 📋 Invoice without IRN = Treated as invalid.

• 💸 Penalty: ₹10,000 per invoice or 100% of tax due, whichever is higher.

• 🚫 ITC Impact: Buyer cannot claim ITC on invalid invoices.

🔹 Best Practices

✅ Implement e-invoicing at least a month before the due date.
✅ Use GSTN-approved tools or automation software.
✅ Maintain backups of IRN acknowledgment for audit.
✅ Reconcile IRP, GSTR-1, and e-way bills monthly.
✅ Seek expert validation for your e-invoicing setup.

🔹 FAQs

Q1. What is the e-invoicing limit for FY 2025–26?
➡️ Applicable to taxpayers with turnover above ₹5 crore from 1 April 2025.

Q2. Do B2C invoices need e-invoicing?
➡️ No, e-invoicing is mandatory only for B2B, export, and government supply invoices.

Q3. Is e-way bill still required if e-invoice is generated?
➡️ Yes, e-way bill generation remains separate, though linked.

Q4. How can I check if my GSTIN is covered under e-invoicing?
➡️ Visit the E-Invoice Portal → “Search by GSTIN” → Status shows “Applicable” or “Not Applicable.”

Q5. Can Tech-Tax Solutions help in e-invoicing setup?
➡️ Yes. We assist in end-to-end e-invoicing setup, software integration, and compliance training for businesses of all sizes.

🔹 Conclusion

With the e-invoicing threshold lowered to ₹5 crore from April 2025, thousands of MSMEs will now fall under its ambit. While it may seem challenging initially, e-invoicing simplifies compliance, reduces manual work, and ensures real-time data flow to the GST portal.

📌 For smooth e-invoicing implementation, training, and compliance audits, connect with Tech-Tax Solutions – Quality, Trust & Expertise in Ghaziabad, Noida & Delhi.