Failure to issue a GST invoice within 30 days of service provision (or by removal for goods) results in penalties, specifically 100% of the tax due or ₹10,000 (whichever is higher), interest at 18% per annum, and denial of Input Tax Credit (ITC) for the recipient. E-invoices not reported to the IRP portal within 30 days are rejected.
Failure to issue a GST invoice, or issuing an incomplete/incorrect one, can lead to the following outcomes: Denial of Input Tax Credit to the recipient. Penalty under Section 122 of the CGST Act: ₹10,000 or 100% of the tax due, whichever is higher. Interest liability on delayed tax payment caused by late invoicing.
30+ days late
If your client hasn't made payment (or meaningful contact) within 30 days of the invoice becoming due, it may be time to issue a letter before action (LBA), or to pass over the matter to a debt collection agency. An LBA gives your client formal notice that legal action is imminent.
Penalties: In cases of non-generation of e-invoice, 100% of the tax or ₹10,000, whichever is higher, is the penalty for each invoice. Administrative Burden: Rejected invoices may require cancellation and reissuance, leading to additional workload and potential errors.
Grace periods typically range from 15 to 30 days. While technically a customer could wait until the exemption date to pay, insurers may still treat the premium as GST-inclusive based on the due date, not the payment date. ...
It is important to note that a benefit of exemption is provided to the integrated GST, or IGST, as it is exempt from late fees if the return submission is delayed. For example, if a company fails to submit returns by the specified deadlines, it is required to pay a penalty of Rs. 50 per day.
– Time limit to issue notice: 3 years from the due date of filing annual return for the relevant year. – Time limit to pass the order: 3 years from the due date of annual return. Example: For FY 2021–22, the time limit to issue notice is 31st December 2025 (assuming annual return due date is 31st December 2022).
If the invoice is issued after provision of service, it has to be done within the specified period of 30 days from the date of supply of service, as per invoice rules.
Start by sending a friendly email reminding them of the overdue invoice and asking when you can expect to receive payment. If you haven't received payment after a week or two, follow up again, and this time, send an updated invoice.
(e) fails to issue invoice in accordance with the provisions of this Act or the rules made thereunder or fails to account for an invoice in his books of account, shall be liable to a penalty which may extend to twenty-five thousand rupees.
30-day e-invoicing upload rule: Businesses with an AATO of ₹10 crore or more must upload their e-invoices to the IRP within 30 days of the invoice date (effective from April 1, 2025), after which the system will reject them.
Is there a time limit for issuing an invoice? Under the Limitation Act 1980, invoices can be issued up to six years after the work was completed or the goods were delivered. While there is no legal restriction within this time frame, issuing invoices promptly is always best to avoid disputes or complications.
A late charge fee is a penalty amount you charge when a customer fails to pay by the invoice due date. Unlike interest fees that compound over time, these fees are added to the unpaid balance for each period payment remains overdue.
An offender not paying tax or making short payments must pay a penalty of 10% of the tax amount due subject to a minimum of Rs. 10,000. Consider — in case tax has not been paid or a short payment is made, a minimum penalty of Rs 10,000 has to be paid. The maximum penalty is 10% of the tax unpaid.
1. Login into GST portal: Navigate to > Services > User Services > My Applications. 2. On Navigating to 'My Applications' page, the taxpayer has to select 'Apply for Waiver Scheme under Section 128A' option under 'Application type' dropdown.
Non/Late Payment
A 5% penalty will be levied on the amount of tax unpaid by the due date and an additional penalty of 2% per month on tax remaining unpaid after 60 days from the due date of the prescribed accounting period (capped at a maximum of 50% of the outstanding tax) may also be imposed.
Stick within the legal time limit for invoicing.
Although the legal time limits for invoicing are usually forgiving, you should send invoices within 30 days to maintain a steady cash flow.
What is the correct time to issue an invoice? Put simply, you should issue the invoice as soon as the service is completed or the product is delivered. The sooner you issue the invoice, the more likely it will be on the customer's mind, and the quicker they'll pay the amount due.
Include as many details as you can regarding the payment, such as the invoice number and amount. As always, continue reminding them of when the due date was, and how overdue they are. However, remain helpful—you never know what they could be going through, or if there was some sort of mix-up.
Time limit for issuance of notice:
As per Section 74(2) of CGST Act, the officer has to issue notice at least 6 months prior to due date of issuing order as per time limit prescribed u/s 74(10).
Effective April 1, 2025, businesses with an annual aggregate turnover (AATO) of ₹10 crores or more must report their e-invoices within 30 days from the invoice date. Previously, this requirement applied only to businesses with an AATO of ₹100 crores and above, but it has now been extended to a wider taxpayer base.
If the Tax Invoice is not issued by the supplier timely, the recipient will not get the GST Credit on Input and hence, such credit can not be adjusted with the GST Outward Liability and hence, it will directly effect on the Working Capital.
GST invoice should be issued within 30 days from the date of supply of service.
Tax Implications: Exceeding the 90 days from the tax invoice date may affect eligibility for tax benefits or exemptions related to export transactions. This could result in businesses missing out on tax incentives intended for exporters.
For GST, the CRA filing and payment deadline is 3 months after your fiscal year end. For GST filed and paid annually, the CRA payment deadline is April 30 and the filing deadline is June 15. For GST filed and paid monthly and quarterly, the CRA filing and payment deadline is one month after the reporting period.