New E-Invoicing Threshold: ₹10 Crore Compliance Guide

This guide explains the new threshold, reporting timelines, system requirements, penalties, costs, and future expectations. It helps mid-sized businesses understand how to comply smoothly and avoid GST issues.

Introduction

India’s GST system is becoming more technology-driven, and e-invoicing is now a key compliance requirement. With the latest update, the government has expanded strict reporting rules to more businesses. From April 1, 2025, companies with an annual turnover of ₹10 crore or more must follow the 30-day e-invoice reporting rule.

Understanding the New E-Invoicing Threshold

E-invoicing in India has been introduced gradually and in a structured manner. The government lowered the turnover limit gradually so businesses could prepare their systems and teams. Today, many mid-sized businesses are subject to mandatory e-invoicing rules.

This section explains who must comply, how the rollout occurred, and the current rules.

Current Applicability and Phased Implementation

At present, all businesses with an annual turnover above ₹5 crore must generate e-invoices for B2B transactions. This requirement was introduced in phases, starting with huge companies. Over time, the turnover limit was reduced to include smaller businesses.

The phased rollout helped businesses upgrade their ERP systems and adjust compliance processes.

Phased Implementation Table

The New 30-Day Reporting Rule

A significant compliance change starts on April 1, 2025. Businesses with Annual Aggregate Turnover (AATO) of ₹10 crore or more must report e-invoices within 30 days of invoice generation. Earlier, this rule applied only to companies with a turnover of over ₹100 crore.

Late reporting will result in invoices being rejected by the Invoice Registration Portal (IRP), creating serious GST issues.

Key points of the new rule:

• Applicable to businesses with a ₹10 crore and above turnover
• E-invoices must be reported within 30 days.
• Late invoices will be automatically rejected.
• Rejected invoices are invalid for Input Tax Credit (ITC)

Key Implementation Requirements

E-invoicing compliance is not only about generating invoices. Businesses must prepare their internal systems, software, and security processes. Without proper system setup, invoices may fail validation.

This section explains technical and operational requirements for smooth implementation.

System Setup Prerequisites

To implement e-invoicing successfully, businesses must upgrade or reconfigure their ERP or accounting software. The system must support government-prescribed formats and securely connect to the IRP.

Strong validation and authentication controls are also required.

Essential system requirements:

• ERP software must support the e-invoice schema
• Ability to generate JSON format invoices
• API integration with IRP through GSP or the direct method
• Real-time data validation checks
• Two-Factor Authentication (2FA) mandatory from April 2025

Mandatory Field Requirements

Every e-invoice must include mandatory information prescribed by GST rules. These fields ensure accurate tax reporting and smooth ITC matching between supplier and buyer.

There are 29 mandatory fields across five main sections.

Mandatory details include:

• Supplier GSTIN, name, and address
• Invoice number, date, and document type
• Buyer GSTIN and delivery address
• HSN/SAC codes and item descriptions
• Quantity, taxable value, GST rates and amounts
• Place of supply and total invoice value

Step-by-Step Implementation Process

Implementing e-invoicing should be done in a planned manner. A step-by-step approach reduces errors and ensures smooth compliance. Businesses should not rush directly into live implementation.

Below are the recommended implementation phases.

Phase 1: Assessment and Planning

The first step is to assess current business operations. Companies must review invoice volume, ERP readiness, and internal skill levels. This helps in choosing the right technology solution.

Proper planning avoids future compliance failures.

Assessment factors:

• Monthly invoice volume (usually 100–500 invoices)
• Existing ERP system capability
• Staff technical knowledge
• Budget for software upgrades

Phase 2: Software Selection and Integration

After assessment, businesses must choose the right e-invoicing solution. The software should integrate easily with existing systems and support future regulatory changes.

The solution must handle invoice volume efficiently.

Selection criteria:

• Real-time IRP connectivity
• Bulk invoice processing capability
• Error alerts and correction guidance
• Automatic regulatory updates

Phase 3: Data Migration and Testing

Before going live, businesses must migrate data and thoroughly test systems. Testing ensures the IRP accepts invoices without errors.

Sandbox testing helps identify issues early.

Testing activities include:

• JSON file validation
• IRN generation check
• QR code verification
• Integration stability testing

Phase 4: Staff Training and Go-Live

Staff training is critical for successful implementation. Employees must understand both technical steps and compliance timelines. Lack of training often leads to late reporting errors.

Training should cover real-life scenarios.

Training focus areas:

• Invoice creation process
• IRP portal usage
• Error resolution steps
• Understanding the 30-day reporting rule

Compliance Checklist for Mid-Sized Businesses

Using a checklist ensures no step is missed. Businesses should regularly review compliance readiness before and after implementation.

Pre-Implementation Requirements

Before starting e-invoicing, businesses must confirm eligibility and system readiness.

Checklist:

• Confirm turnover exceeds ₹10 crore.
• Audit the ERP system capability.
• Activate the e-invoice option on the GST portal.
• Decide on the API or GSP integration method.

Technical Configuration Checklist

Technical setup ensures invoices are generated and reported correctly.

Checklist:

• Install compatible e-invoicing software.
• Configure all mandatory fields.
• Test JSON file generation.
• Enable batch processing workflows.

Operational Compliance Checklist

Operational controls help ensure ongoing compliance.

Checklist:

• Set alerts for 30-day deadlines.
• Maintain digital backups of invoices.
• Define error correction procedures.
• Monitor compliance regularly

Penalties and Non-Compliance Consequences

Failure to comply with e-invoicing rules can result in heavy penalties and severe business disruptions. The GST law treats e-invoicing violations strictly.

Financial Penalties

Penalties are imposed under Section 122 of the CGST Act, 2017.

Penalty structure:

• No e-invoice: 100% of tax or ₹10,000 per invoice
• Incorrect e-invoice: ₹25,000 per invoice
• Late reporting: Invoice rejected, ITC blocked

Operational Consequences

Apart from penalties, non-compliance affects daily business operations.

Business impact includes:

• Loss of Input Tax Credit
• Detention of goods and vehicles
• Buyers are unable to claim ITC.
• Possible legal action for repeated defaults

Cost-Benefit Analysis for Mid-Sized Businesses

E-invoicing requires investment, but the long-term benefits outweigh the costs. Businesses gain efficiency, accuracy, and better GST compliance.

Implementation Costs

Initial and recurring costs depend on business size and the chosen solution.

Typical costs:

• Software and customization: ₹25,000–₹75,000
• ERP integration: ₹15,000–₹50,000
• Staff training: ₹10,000–₹25,000
• Monthly maintenance: ₹5,000–₹15,000

Long-Term Benefits

Once implemented, e-invoicing improves business efficiency and cash flow.

Key benefits:

• Reduced manual data entry
• Faster ITC availability
• Fewer GST mismatches
• Improved working capital

Technology Integration Options

Businesses can choose different integration methods based on technical strength and invoice volume.

Direct API Integration

Direct API integration is suitable for businesses with strong IT infrastructure. It offers maximum automation and control.

Benefits:

• Real-time invoice processing
• Automatic IRN generation
• Minimal manual effort

GSP-Mediated Solutions

GSP solutions are ideal for businesses with limited technical teams. They provide managed compliance services.

Advantages:

• Ready-to-use templates
• Technical support and updates
• Flexible pricing models

Hybrid Implementation Approach

Some businesses use both direct API and GSP solutions. This provides flexibility for different transaction types.

Hybrid benefits:

• Efficient handling of high-volume invoices
• Support for special or complex cases

Future Regulatory Considerations

The government may further reduce the e-invoicing threshold in the coming years. Businesses should stay prepared for future changes.

Anticipated Threshold Reductions

Industry expectations suggest that e-invoicing may extend to companies with a turnover of ₹1 crore by 2026–27.

Preparation steps:

• Use scalable systems
• Monitor GST notifications
• Maintain proactive compliance

Technology Evolution and Standards

E-invoicing technology continues to improve. Businesses should adopt future-ready solutions.

Upcoming focus areas:

• Enhanced digital signatures
• Advanced analytics integration
• Cross-border e-invoicing readiness  

Conclusion

The expansion of the 30-day e-invoicing rule to businesses with a turnover of ₹10 crore is a significant change in GST compliance. Companies must act early by upgrading systems, training staff, and setting precise reporting controls.

While non-compliance can lead to penalties, ITC loss, and operational disruption, proper implementation brings efficiency, transparency, and better cash flow. Businesses that treat e-invoicing as a digital improvement rather than a burden will gain long-term advantages in compliance and growth.