GST In India, eInvoice was launched to usher in the digital era by replacing traditional paper-based methods. eInvoicing can help businesses save money, improve efficiency, and speed up their processes. Most organisations will benefit from eInvoicing since it eliminates the need for duplication or transfer of data from one system to another, reducing compliance load. The invoice information given to GSTN for creating the Invoice Reference Number (IRN) will be utilised to auto-populate various other systems such as GST returns, input tax credit reconciliation, eWay bill, and GST refunds using eInvoicing. As a result, GST eInvoicing will make doing business much easier.
Implementation of eInvoicing
The proposal to adopt eInvoicing was presented to the GST Council during its 35th meeting in June 2019. From January 2020, the GST Council has announced the in-principle commencement of a pilot project for the online creation of B2B e-invoices on a voluntary basis.
GST eInvoice's Benefits
GST because there are presently no standards for invoicing, eInvoicing will radically change the business process. Invoicing would be standardised across the GST eco-system with the adoption of eInvoicing. As a result, an eInvoice created by one programme may be read by another, without the requirement for data transmission or re-entry. Finally, eInvoicing eliminates the procedure of compiling invoices at the end of the month and streamlines the flow of input tax credits.
The Basics of eInvoicing
The following are some of the most important topics to understand when it comes to GST eInvoicing:
Creating an eInvoice
GST As a result, an eInvoice is not an invoice created on the Government Portal, which might become a trade bottleneck. GST eInvoicing is a method of invoicing in which the taxpayer creates a unique Invoice Reference Number (IRN) for each invoice and includes it on the issued invoice.
The GST Invoice Registration Portal issues an invoice reference number (IRN) once an eInvoice is successfully uploaded. It is a unique identifier for each invoice. To comply with eInvoicing rules, the supplier must provide the invoice reference number on the invoice.
Format for electronic invoices
The GSTN does not have a particular format for eInvoices. There will be no modifications to the invoice that is currently being produced and printed. Certain data from the GST invoice will be electronically submitted to the GSTN Invoice Registration Portal (IRP), and an Invoice Reference Number and QR code will be created. The QR code must be printed on the invoice that the supplier generates. As a result, suppliers may continue to create invoices from current billing softwares that meet their needs and are consistent with GST invoicing laws. The only difference will be that the GST will generate an invoice reference number.
Portal for Invoice Registration (IRP)
The platform that issues the Invoice Reference Number is known as the Invoice Registration Portal (IRP) or eInvoice Registrar. The first IRP has been suggested as NIC. More IRPs will be introduced as the number of taxpayers using eInvoicing grows, increasing availability, speed, and creating a distributed architecture.
Making a GST eInvoice
The process of creating a GST eInvoice may be broken down into four steps:
- Invoice generation
The seller will create an invoice in his or her accounting, billing, or ERP system in the first step. The invoice must be generated in accordance with the GSTN’s eInvoice guidelines and must include certain essential characteristics. The software-generated invoice should subsequently be sent to the Invoice Registration Portal in JSON format.
- Invoice Registration Portal JSON Upload
The seller’s accounting software will be required to submit the invoice in JSON format to the Invoice Registration Portal through APIs, GSP/ASP, or an offline application. APIs can be used to upload JSON straight from accounting software.
- IRP is in charge of data processing.
The IRP will verify that the JSON invoice received is accurate and that no further invoices from the same supplier have been received. The IRP will append its digital signature to the JSON invoice when it has been validated, as well as an IRN (Invoice Reference Number) and a QR code. The seller receives this digitally signed JSON with IRN, which becomes a legitimate GST invoice.
- GSTN Transmission & eWay Bill Platform
To make compliance easier for taxpayers, IRPs will exchange signed eInvoice data with the GSTN system and the eWay Bill site.
Reference Number for Invoice (IRN)
Each invoice that is approved and uploaded by a seller to the Invoice Registration Portal is assigned an Invoice Reference Number (IRN). In the GST system, an IRN is a 64-character number that is unique to each taxpayer, financial year, and document type.
When you upload a JSON invoice file, the Invoice Registration Portal will generate an IRN for you. The IRN will be created using the supplier’s GSTIN, document type, document number, and invoice year. INV stands for invoice, CRN for credit note, and DBN stands for debit note.
QR Code for eInvoice
The IRP will digitally sign a JSON invoice supplied by the seller and create a QR code including the unique IRN as well as other invoice data, allowing it to be easily checked online. The buyer or any tax offer can scan this QR code using an app to verify the authenticity of the invoice provided. The following information will be included in the eInvoice QR code:
- GSTIN of the provider GSTIN of the receiver
- Supplier-provided invoice number
- Date of invoice
- Value of the invoice
- The total number of line items
- The primary item’s HSN code is (Item with highest value)
- Invoice Reference Number Is Unique (IRN)
eInvoice Format for GST
The GST eInvoice will look and function similarly to the current GST invoice format. The GSTN has stated that the vendor is not needed to write the IRN (64 characters). The IRN, on the other hand, will appear in the QR code generated by the Invoice Registration Portal. The invoice and IRN will be included in the QR code. As a result, it is preferable to create a digitally signed QR code as a response, which will serve as proof of invoice registration and may be printed on invoices issued by a company.
There is a time limit for creating an eInvoice.
The government will announce the deadline for creating an eInvoice. It will not be valid unless an invoice is registered with the Invoice Registration Portal and a QR code is generated. As a result, eInvoicing must be completed prior to the transportation of commodities, delivery of goods or services, or the filing of GST returns.
On the Invoice Registration Portal, an eInvoice can be entirely cancelled within 24 hours after it has been produced. It will not be allowed to cancel an eInvoice on the Invoice Registration Portal after 24 hours, and you will have to do it on the GST Portal before completing your GST return.
The same invoice number cannot be used to produce another invoice once a GST eInvoice has been cancelled.
The GST Portal allows you to make changes to your eInvoice. The GST Portal is the only place where you may make changes to an eInvoice produced on the Invoice Registration Portal. If you send an updated invoice to IRP as a JSON file, it will be denied since the IRN is duplicated.