Self Invoice Under GST: New RCM E-Invoicing Rules Explained

The Goods and Services Tax Network (GSTN) has announced a new e-invoicing facility for self-invoices raised under the Reverse Charge Mechanism (RCM). The announcement, dated 16 October 2026, introduces two new supply types: RCMDOM and RCMIMP.

The facility is intended for registered taxpayers with an aggregate annual turnover (AATO) of ₹5 crore or more. However, businesses should not rush to change their live filing process yet. GSTN says the new functionality is currently available in the sandbox, which is a test environment, and the production rollout date will be announced later.

In this guide, we explain what the announcement means, who may be affected, how the new codes work, and what businesses should do now.

What Is Self-Invoicing Under GST?

Self-invoicing under GST refers to a situation in which a registered recipient issues an invoice for a qualifying purchase from an unregistered supplier when the applicable GST provisions require the recipient to issue one. Under the Reverse Charge Mechanism, the recipient pays the applicable GST instead of the supplier paying it in the usual way. However, self-invoicing does not apply automatically to every purchase from an unregistered person.

The key things businesses should understand are:

• Who issues the invoice: The registered recipient issues the invoice where required under the applicable GST provisions.
• When it applies: The transaction must fall within the relevant legal requirements for self-invoicing.
• Who pays GST under RCM: The recipient is responsible for paying GST when the reverse charge provisions apply.
• Why it matters: Proper invoicing and record-keeping help businesses manage their GST compliance obligations.

For example, an Indian business may receive a service from an unregistered domestic supplier. If the service falls within a notified RCM category and the law requires the recipient to issue an invoice, the business must follow the relevant invoicing requirements.

What Did GSTN Announce on 16 October 2026?

GSTN's announcement follows the recommendation made at the 57th GST Council meeting on 8 October 2026. The Council recommended extending e-invoicing to specified domestic supplies received from unregistered persons under RCM and to imports of services for taxpayers with aggregate annual turnover of ₹5 crore and above.

The main points of the announcement are:

• Two transaction categories: RCMDOM for specified domestic RCM self-invoices and RCMIMP for qualifying imports of services.
• Turnover threshold: The proposed extension concerns eligible registered taxpayers with AATO of ₹5 crore or more.
• Sandbox availability: The functionality was made available in the sandbox environments of all six authorised Invoice Registration Portals (IRPs).
• Testing and integration: Businesses and technology providers can prepare their systems for the new functionality.
• Production rollout: The production implementation date and reporting timeline are to be communicated separately.

It is important to distinguish the GST Council's recommendation from the operative legal requirements. Businesses should verify the applicable notifications, amendments and official implementation instructions before changing their live reporting processes.

For the wider policy background, read 57th GST Council meeting recommendations.

Who May Be Covered by New E-Invoicing Facility?

The proposed extension is relevant to registered taxpayers with aggregate annual turnover of ₹5 crore or more who undertake the specified RCM transactions.

Businesses can begin by checking the following areas:

• Aggregate annual turnover: Determine whether the business meets the applicable threshold.
• Domestic transactions: Identify purchases from unregistered domestic suppliers that may fall within the relevant RCM provisions.
• Imports of services: Review services received from suppliers outside India and determine whether the recipient is liable to pay GST under RCM.
• Self-invoicing requirements: Confirm whether the applicable provisions require the recipient to issue a self-invoice.
• System readiness: Check whether the accounting or ERP system can capture the required invoice information and support the relevant e-invoicing process.

Meeting the turnover threshold alone does not mean that every purchase must be self-invoiced under RCM. Consider the nature of the transaction and the applicable legal requirements.

How Will the New Self-Invoicing Process Work?

The announcement describes the intended reporting process for eligible, active registered recipients.

• Step 1: Identify the relevant transaction. The business checks whether the purchase is covered by the applicable RCM provisions and whether a self-invoice is required.
• Step 2: Prepare the self-invoice. The recipient prepares the prescribed invoice details in its accounting or ERP system.
• Step 3: Select the correct supply type. The recipient chooses RCMDOM for the specified domestic RCM transaction or RCMIMP for the qualifying import of services.
• Step 4: Report the invoice through an authorised Invoice Registration Portal (IRP). The recipient submits the required invoice particulars through the appropriate system.
• Step 5: Complete validation. If the submitted details pass the prescribed validations, an Invoice Reference Number (IRN) is generated.

An IRN is a unique reference created for successfully reported invoices. Follow the specified technical requirements and validation rules. The new e-invoicing facility under the reverse charge mechanism enables recipient-generated self-invoices to be reported through the existing framework.

RCMDOM and RCMIMP: Practical Examples

RCMDOM and RCMIMP separate domestic RCM transactions from qualifying service imports for business review.

RCMDOM: Domestic RCM transactions

RCMDOM relates to specified domestic supplies received from unregistered suppliers where the registered recipient is liable to pay GST under RCM. Businesses should review the following before classifying a transaction:

• Supplier location: Check whether the supplier is based in India.
• Registration status: Confirm whether the supplier is unregistered.
• Nature of the supply: Determine whether the transaction falls within the applicable RCM provisions.
• Invoice requirement: Verify whether the recipient is required to issue a self-invoice.
• E-invoicing applicability: Check the relevant implementation instructions before applying the new reporting process.

For example, an Indian company may receive a service from an unregistered supplier in India. If the service is covered by the applicable RCM provisions and self-invoicing is required, the transaction may fall within the domestic category.

^{Remember: Not every domestic purchase from an unregistered supplier automatically falls under RCM.}

RCMIMP: Import of services

RCMIMP relates to self-invoices for qualifying imports of services from suppliers outside India where the recipient is liable to pay GST under RCM.

Businesses should pay attention to these points:

• Supplier location: Establish whether the service provider is located outside India.
• Nature of the service: Determine whether the transaction qualifies as an import of services.
• RCM liability: Confirm whether the recipient is required to pay GST under RCM.
• Supporting records: Retain relevant contracts, supplier invoices, payment records and other supporting documents.
• Reporting requirements: Follow the applicable official instructions for the new facility once issued.

An Indian business must determine if consulting services from a foreign supplier qualify as an import and if RCM applies, affecting its GST treatment.

The Numbers Businesses Should Know

The announcement contains several important figures. Here is what they mean for businesses.

There is also a wider picture to consider. According to the Press Information Bureau's October 2026 GST reform material, India's GST system had approximately 1.70 crore registered taxpayers as of September 2026. By 30 September 2026, it had cumulatively processed 3,053 crore invoice uploads and 833.82 crore e-way bills.

These figures show the scale of India's digital GST system. They are national system statistics, not a count of businesses affected by the new RCM self-invoicing facility.

What Do the New GST Self-Invoicing Rules Mean for E-Invoicing?

The extension connects RCM self-invoices to e-invoicing, involving GST invoice distinction, data submission, validation, and receiving an IRN. Businesses should understand the following:

• Invoice preparation: Capture the required invoice details in the accounting or ERP system.
• Data submission: Submit the relevant information through the applicable IRP process.
• Validation: The portal validates the submitted information according to its requirements.
• IRN generation: A successfully registered invoice receives an IRN.
• New RCM categories: Confirm the specific data fields, validations and workflow requirements for RCMDOM and RCMIMP through the official release instructions.

The new facility does not represent a broad change to all RCM transactions or invoices. Its scope is limited to specific transactions defined by the applicable requirements.

Is Self-Invoicing Under GST E-Invoicing Mandatory Right Now?

The 16 October announcement does not establish a live production start date. Before making changes to live operations, businesses should check the following:

• Government notifications: Verify the applicable notification or legal amendment.
• GSTN updates: Look for subsequent announcements about implementation.
• IRP release notes: Review the detailed instructions issued for the new functionality.
• Effective date: Confirm when the production facility and any related reporting requirements take effect.
• Existing obligations: Continue following the GST requirements already applicable to the business.

A Council recommendation, a sandbox feature and an operative production requirement are different things. Businesses should monitor the official e-Invoice portal and the relevant government notifications for the operative requirements.

Which Invoice Registration Portals Are Available for Testing?

GSTN announced that the new functionality was available in the sandbox environments of six authorized Invoice Registration Portals. These environments support testing and integration ahead of the production rollout.

The six IRPs identified in the announcement are:

1. NIC IRP-1
2. NIC IRP-2
3. Cygnet IRP-3
4. Clear IRP-4
5. EY IRP-5
6. IRIS IRP-6

Businesses and technology providers should take the following steps:

• Check portal documentation: Review the instructions for the IRP being used.
• Consult software providers: Confirm whether the accounting system, ERP or integration platform supports the relevant testing workflow.
• Use the sandbox: Test data mapping, validations and integration where appropriate.
• Track release notes: Review subsequent instructions for changes to the functionality.
• Confirm production access: Wait for the official production rollout instructions before changing live reporting procedures.

The NIC e-Invoice API sandbox is a useful starting point for developers and integration teams. Sandbox testing should not be confused with live invoice reporting.

What Should Businesses Do Now?

Businesses that may be affected should begin preparing their processes rather than making assumptions about the implementation date. Early preparation can help identify gaps in transaction classification, accounting systems and invoice data.

The following steps can help businesses get ready:

• Review RCM transactions: Identify domestic purchases from unregistered suppliers and imports of services that may be covered by RCM.
• Check turnover: Assess whether the business meets the applicable aggregate annual turnover threshold.
• Validate tax treatment: Confirm whether each transaction falls within the relevant RCM provisions and whether self-invoicing is required.
• Speak to your software provider: Ask your ERP, accounting software or GSP/ASP provider about sandbox support for RCMDOM and RCMIMP.
• Test invoice data: Where appropriate, use an authorised sandbox environment to assess data mapping, validation and integration.
• Update internal controls: Review how purchase records, self-invoices, tax payments and reconciliation are maintained.
• Track official updates: Wait for the applicable production instructions and legal requirements before changing live reporting procedures.

These steps can help reduce last-minute integration issues while keeping the business aligned with the actual implementation timeline. But if you still need help understanding your GST compliance requirements, visit Paytaxs GST services.

Conclusion

The 16 October 2026 GSTN announcement marks a key step in e-invoicing for specified recipient-generated self-invoices under RCM, introducing two new supply types, RCMDOM and RCMIMP, for registered taxpayers with an annual turnover of ₹5 crore or more. Currently, the facility is only available for sandbox testing, and the production rollout date is still pending. Businesses should review their RCM transactions, consult with software providers, and stay updated on official notifications for implementation details.

^{Note: This article is based on the GSTN announcement from October 16, 2026. It is for informational purposes only and not a substitute for professional GST advice.}

Official Sources

• GSTN News and Updates

• 57th GST Council Meeting Recommendations — Press Information Bureau

• NIC e-Invoice API Sandbox

• Official e-Invoice Portal