GST E-invoicing: Essential Points You Should Know

E-invoice is a system where taxpayers can generate invoices.

‘E-invoicing’ or ‘electronic invoicing’ is a system wherein B2B invoices are electronically verified by GSTN for further usage on the common GST portal. 

In this process, an identification number will be issued for every invoice generated, by the Invoice Registration Portal (IRP) that is managed by GST Network (GSTN). This information will be passed directly to the GST portal from the IRP portal.

The new Indian e-invoicing model mandatorily requires businesses to generate e-invoices on their internal systems instead of generating from the central portal of the tax authority.

When Will E-invoice Be Implemented?

1. The taxpayers with annual aggregate turnover of Rs 500 crores or more can voluntarily generate e-invoices starting from 7th January 2020 through APIs

2. The taxpayers with the turnover of more than Rs 100 crores but less than Rs 500 crores can also join them starting from 1st February 2020

3. The electronic invoicing will be mandatory from 1st April 2020 for all taxpayers with turnover over Rs 100 crores

4. The aggregate turnover will include the turnover of all GSTINs under a single PAN, across India

What is the Process of Getting an E-invoice?

1. Normal Invoice

 Normal invoice is generated by the seller from his billing system and it should adhere to e-invoice schema. It should be generated in JSON format as it is the only acceptable format in the IRP 

2. Submit the E-invoice Request to IRP

  Next step is to upload the JSON schema to IRP. It can be uploaded through APIs or direct upload as IRP has the facility to accept both ways

3. IRP Validate Invoice and Generate IRN Number

  After the invoice is generated in JSON format it is then sent to the IRP. The IRP validates the invoice after receiving it and then generates a particular IRN number

4. IRP to Send Digitally Signed Invoice to GST

  Next, it is sent to GST portal after embedding the registrar’s digital signature on the invoice

5. GST to Generate QR code and Send Hashtag to IRP

  GST System will generate the QR code specific to the invoice, checks with the hashtag stored in invoice registry, checks for duplicate data and then sends it to IRP

6. IRP Send Invoice Details to QR Code (JSON Format) 

 IRP will return the digitally signed JSON to seller with the embedded QR code and can be shared as a PDF over email

TYASuite E-invoice Benefits

These are the benefits of using e-invoice as initiated by GSTN

1. E-invoice resolves and fixes huge gaps in data reconciliation under GST to reduce mismatch errors

2. E-invoices created on our software can be read by another, allowing interoperability and reducing data entry errors

3. Real-time tracking of invoices prepared by the supplier is enabled by e-invoice

4. Backward integration and automation of the tax return filing process – the relevant details of invoices would be auto-populated in the various returns, especially for generating the part-A of e-way bills

5. Faster availability of genuine input tax credit

6. Lower probability of audits/surveys by the tax authorities since all the information is available at a transaction level