Benefits of e-Invoicing for MSMEs: E-Invoicing for small businesses which fall under the definition of MSME (Micro, Small and Medium Enterprises (MSMEs) in India has made it easier for small businesses to excel in the tech-based regulations and has also reduced the tedious manual work. They have made businesses easier and seamless.
In the 37th GST Council meeting which was held in October 2022, e-invoice login and e-invoice applicability have been made mandatory for all MSME businesses. As per the notification, organisations are mandatorily required to adopt this framework from the 1st of October 2020.
E-invoice for small businesses is required if the enterprises or organisations have an annual turnover of INR 20 crores to 50 crores in any previous fiscal year from 2017-2018 to 2021-22. These guidelines are as per the CGST (Central Goods and Services Tax) notification 01/2022 dated February 24, 2022. E-invoicing offers several benefits because it is super easy to generate without any complications.
E-invoicing for services having an annual turnover of at least 100 crores is required to generate and authenticate e-invoices via the GSTN portal. Given below is the list of businesses and organisations that are exempted from submitting e-invoices.
Special Economic Zones also known as SEZs are geographical regions or areas that are present in a country and provide businesses with simple tax regulations and compliances. Special Economic Zones or SEZs are considered as part of foreign territories and hence they attract zero per cent of GST.
According to the CGST notification dated 30th of July 2020, Special Economic Zones, SEZs are exempted from submission of e-invoices for their outward supplies. However, it is important to note that e-invoice is required for special economic zone developers if they have specified turnover and they fulfil other conditions mentioned in the e-invoicing mandate.
If a person’s GSTN falls under the e-invoicing mandate, then submission of e-invoices is mandatory for him even for SEZs or Special Economic Zones.
E-invoicing offers smart and high-tech solutions to MSMEs and they also help MSME businesses or organisations to reduce fraudulent invoicing activities and also limit tax evasion to a great extent. Given below are several benefits of e-invoicing for MSMEs (Micro, Small and Medium Enterprises).
A fiscal year is a one-year period of time that a company or government uses for accounting purposes and for the preparation of financial statements.
An E-way bill is a document that contains the consignment and shipment details of goods.
The Goods and Services Tax Network is a unique IT network enterprise that establishes a channel of communication network between taxpayers, central or state government and stakeholders.