“We are below ₹5 crore this year, so e-invoicing is not our problem” is one of the most expensive sentences in a finance meeting. Notification No. 10/2023-Central Tax does not describe the threshold as a current-year test. It provides that every registered taxpayer whose aggregate turnover in any preceding financial year from FY 2017-18 onwards exceeds ₹5 crore is required to issue e-invoices from 1 August 2023.
That wording changes the operating question. Do not ask only what the company sold last year. Ask whether the company crossed the ₹5 crore threshold under Notification No. 10/2023-Central Tax in any preceding financial year from FY 2017-18 onwards, and then confirm the position with your GST practitioner.
The threshold in one line
Notification No. 10/2023-Central Tax, dated 10 May 2023 and effective 1 August 2023, reduced the e-invoicing threshold to annual aggregate turnover exceeding ₹5 crore. Notification No. 10/2023-Central Tax provides that taxpayers with annual aggregate turnover of ₹5 crore or less are not required to issue e-invoices under that entry.
The cited notifications' threshold timeline is:
The timeline matters when reviewing historical enablement. It shows why a company should build a year-by-year AATO file rather than rely on the current dashboard number.
⚠ Verify: Under Notification 10/2023-CT, the ₹5 crore test applies if AATO exceeded ₹5 crore in any financial year from FY 2017-18 onwards, and the obligation is permanent once crossed. Confirm the historical-turnover application with your GST practitioner before concluding that the company is covered or outside scope.
What changes when you are covered
Notification No. 10/2023-Central Tax provides that a covered taxpayer must upload e-invoices to a government-designated Invoice Registration Portal, or IRP, to obtain an Invoice Reference Number, or IRN. It also provides that an e-invoice without an IRN is not a valid tax invoice.
That creates a before-issue control. Your billing or ERP system may still create the commercial invoice, but the invoice data has to pass through the required IRP route and return the IRN. The team needs a process for rejected payloads, duplicate document numbers, cancelled documents and downtime. Those are operational design questions; the legal starting point is that the covered invoice needs the IRN described in the notification.
Notification No. 10/2023-Central Tax lists GSTR-1 Table 4/5/6/7, GSTR-2B and e-way bill auto-population as affected areas. In plain founder language, e-invoicing is not a PDF-format project. It is a data-integrity project that touches invoicing, return reporting and downstream customer reconciliation.
Which document data must be ready?
Notification No. 10/2023-Central Tax does not supply a full field-by-field implementation manual, so do not invent one from memory. It does give the business boundary: create the e-invoice through the designated IRP route, obtain the IRN, and ensure the document is valid under the applicable system.
Use that boundary to ask your implementation team for a field map backed by the current portal specification. For each invoice, the finance owner should know where the GSTINs, document type, document number, date, values, tax details, HSN or SAC and customer master data come from. If the answer is “someone will correct it on the portal,” the process is not yet controlled.
The HSN rule moves at the same turnover line
Notification No. 78/2020-Central Tax, dated 15 October 2020 and effective 1 April 2021, sets a turnover-linked HSN disclosure requirement.
For taxpayers with AATO of ₹5 crore or less, Notification No. 78/2020-Central Tax provides that B2B supply invoices must mention a 4-digit HSN code. It provides that B2C supplies do not require mandatory HSN disclosure on the invoice under that entry, while B2B reporting still applies in GSTR-1.
For taxpayers with AATO above ₹5 crore, Notification No. 78/2020-Central Tax provides that a 6-digit HSN code must be mentioned on all invoices, both B2B and B2C. It also states that services use 6-digit SAC codes and that these are mandatory on invoices alongside goods HSN codes.
That is why the ₹5 crore review should include more than IRP connectivity. The product master, service catalogue and invoice templates need the right code depth for the business's category. An e-invoice integration that can transmit data but cannot reliably source the right HSN or SAC creates a cleanly automated error.
⚠ Verify: Notification No. 78/2020 carries a verification note on whether any later notification requires 8-digit codes for particular goods and on the AATO basis. Confirm the current position before finalising the master-data rule.
The founder's coverage test
Build a one-page table with one row for every financial year from FY 2017-18 onward and columns for each GSTIN and the PAN-level aggregate. Notification No. 10/2023-Central Tax uses “aggregate turnover,” so have the tax team define the population consistently before adding the numbers.
Then answer three questions:
- Did the aggregate turnover exceed ₹5 crore in any preceding financial year from FY 2017-18 onwards?
- Is the company issuing the invoice types covered by its current e-invoicing implementation?
- Do the product and service masters support the HSN/SAC disclosure requirement described by Notification No. 78/2020?
If any answer is unclear, create a review item. Do not turn uncertainty into a “not applicable” flag.
What breaks in real companies
The billing system and ERP disagree. One system treats a customer as B2B and another treats it as B2C. The resulting payload may not match the invoice.
The master data is incomplete. A new service is sold without a valid SAC, or a product is mapped to a code with the wrong number of digits.
The IRP response is not stored. The team obtains an IRN but does not preserve the response against the invoice record. Month-end reconciliation then becomes a manual search.
Credit notes are treated as an afterthought. Notification No. 10/2023-Central Tax's affected-form list does not answer every document scenario. Have the CA and implementation vendor map the current document rules instead of assuming the original invoice workflow covers every adjustment.
The company looks only at the current year. This is the threshold error the notification is designed to prevent. A fall in current turnover does not, by itself, answer the historical AATO question.
A 30-day implementation plan
Days 1–5: assemble historical AATO evidence, the GSTIN list, invoice volumes, product/service masters and current return owners.
Days 6–10: confirm coverage with the GST practitioner and map Notification No. 10/2023-Central Tax to the invoice populations in scope.
Days 11–18: test the IRP integration, error handling, IRN storage, invoice rendering and HSN/SAC controls in a non-production workflow.
Days 19–24: run sample invoices through the complete process and reconcile the invoice register to the e-invoice response and return data fields identified by Notification No. 10/2023-Central Tax.
Days 25–30: train sales operations and accounts receivable, publish a rejection escalation path, and put the monthly reconciliation on the close calendar.
The aim is not a one-day switch. It is a control that makes a rejected or missing IRN visible before the invoice reaches the customer.
FAQ
Our turnover is ₹4.8 crore now. Are we automatically outside e-invoicing?
Not necessarily. Notification No. 10/2023-Central Tax asks whether AATO exceeded ₹5 crore in any preceding financial year from FY 2017-18 onwards. Review the historical file and confirm.
Can we issue a normal PDF if the customer is comfortable with it?
Notification No. 10/2023-Central Tax provides that a covered taxpayer must upload the e-invoice to the designated IRP to obtain an IRN, and that an e-invoice without an IRN is not a valid tax invoice. Customer preference does not replace that system requirement.
Is HSN only a goods problem?
No. Notification No. 78/2020-Central Tax provides that services use SAC codes and describes a 6-digit service code requirement.
Do we need an 8-digit HSN?
Notification No. 78/2020-Central Tax does not establish a universal 8-digit rule. It carries an explicit verification note about later notifications and specific commodity categories. Confirm before implementing.
Statutory basis
- Notification No. 10/2023 — Central Tax
- Notification No. 78/2020 — Central Tax
- GSTR-1 due-date reference
- GSTR-3B due-date reference
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