What is E-invoicing?
Reviewed by CA Apurav GargLast reviewed
In short
E-invoicing is reporting each B2B invoice to the government's Invoice Registration Portal, which returns an Invoice Reference Number (IRN) and a signed QR code. Above the turnover limit, an invoice without an IRN is not valid.
What it is
An e-invoice is not a new kind of invoice. You still prepare a normal GST invoice in your own software. E-invoicing adds one step: the invoice's details are uploaded to an Invoice Registration Portal (IRP), which checks them, gives the invoice a unique Invoice Reference Number (IRN), signs it and returns a QR code. The IRN and QR code are printed on the invoice.
The IRP then passes the details to the GST system, where they fill in your GSTR-1 and the buyer's GSTR-2B, and to the e-way bill system.
Who must do it
E-invoicing applies to a business whose aggregate turnover, across all GSTINs under one PAN, exceeded the notified limit in any financial year since 2017-18. The limit has been lowered in stages since October 2020 and can be changed again by notification, so check the current one. Once you cross it in any year, e-invoicing applies from then on, even if turnover falls later.
Some sectors are exempt by notification, such as banks, insurers and goods transport agencies.
What it covers
- B2B invoices: to any buyer with a GSTIN, including your own GSTINs in other states.
- Exports, including supplies to SEZ units.
- Credit and debit notes on these.
B2C invoices to consumers are not e-invoiced. Very large businesses must print a dynamic QR code on B2C invoices instead.
Time limit
Businesses above a notified turnover limit cannot report an invoice to the IRP after a set number of days from its date. The portal blocks late reporting. Report invoices when you issue them.
If you miss it
An invoice that should have been e-invoiced but was not is not a valid tax invoice. The buyer may lose the input tax credit, which hurts the relationship, and penalties can apply to you. The e-way bill also depends on it for B2B movements.
For ecommerce sellers
Most D2C and marketplace sales are B2C, so sellers sometimes assume e-invoicing does not affect them. But quick-commerce and modern-trade sales on purchase orders, stock transfers between your own GSTINs, and B2B sales to resellers all need e-invoices once the limit is crossed. Set up your billing software to e-invoice those automatically.
Example in rupees
A brand's aggregate turnover crossed the e-invoicing limit in 2025-26, so e-invoicing applies to its B2B invoices from then on, even if a later year's turnover is lower.
| Sale | E-invoice needed? |
|---|---|
| Website order from a consumer | No: B2C invoices are outside e-invoicing |
| Marketplace order from a consumer | No |
| Sale on a purchase order to a quick-commerce platform's buying entity | Yes |
| Stock transfer to its own Maharashtra GSTIN | Yes: it is a supply between distinct persons |
| Credit note to that buyer for short-shelf-life rejections | Yes |
| Export to a distributor in Dubai | Yes |
The brand raises the quick-commerce invoice in its billing software, which sends it to the portal and prints the IRN and QR code on it. Without them, the buyer cannot rely on the invoice for input tax credit. The figures are illustrative.
Legal reference: CGST Act, 2017: section 31; CGST Rules, 2017: rule 48(4) and (5); Notification 13/2020-Central Tax, as amended
Related terms
Work it out for your business
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General information only, not professional advice. Rules and rates change — check the official source before you act.