A document is exchanged between a supplier and buyer and validated by the government tax portal. E-invoicing proposes a system where business-to-business (B2B) bills are digitally prepared in an e-invoicing format and authenticated by the Goods and Services Tax Network (GSTN). This system ensures that all businesses follow a standard form before reporting invoices to the GST portal.
The E-Invoices generate a standardized format. The bill generated from one software can also be read by different software. Compatibility is possible. The E-invoicing system is simple and brickly to use. Better customer service offer while also saving time.
How to register for an E-invoicing system?
Registering on the e-invoicing portal is easy if you are a GST-registered taxpayer with a valid GSTIN number. If you have registered your business on the e-way bill portal, you can also use the same credentials to log in to the e-invoicing portal. If you have not reported at the EWB portal, you can register directly in the e-invoicing system. The taxpayer should have a GSTIN and mobile number registered at the GST portal.
Generating an E-Invoice:
Taxpayers will induce checks like they generally do, except reporting will now be done electronically. Taxpayers will have to follow the E-Invoice schema and submit obligatory details consequently. Then is a list of compulsory and voluntary parameters:
- Sales details like tax scheme, supplier type
- Document details: type, number, and Date
- Information about the item, such as the service or goods, HSN rules, total amount, GST rate &, etc.
- Customer information like legal name, GSTN number, address, location, state law, and PIN law
- Dispatch from address details (obligatory if it is different from supplier details)
- Shipping details (obligatory if it is different from the buyer’s address)
- If the good affiliate and moved in batches, still add a batch number.
- Bill details include assessable values and total bill value.
Besides the obligatory parameters, the Council also listed voluntary parameters, which are subject to change based on the requirements of the business. Once the billing field is finalized, a taxpayer has to decide if the account or billing software can generate a JSON file, which uploads to the IRP.
Benefits of e-invoice :
a.Interoperability of E-Invoices:
The E-Invoices are made in a standard format by electronic invoicing software. It also allows interoperability between different systems.
b.Helps in tax computation :
Real-time access to data eliminates the compass of manipulation. Hence tax calculates in real time. The scope of fake GST bills etc. is not there as the input tax credit & output tax details are auto-filled.
c.QR Code:
The E-Invoice is vital in computing the Input Tax Credit. So If the E-Invoice a commodity, details secured in the QR law greatly help.
d.Better Customer Service:
Apart from the essential e-invoicing benefits, electronic invoicing software offers more client service with handholding training &So real-time backing in the generation of E-Invoices.
e.Save Time:
E-invoicing software is straightforward to use & fast. So The E-Invoices generates in just a snap of filters. It also saves time & also when participating with the client and also provides a provision of getting paid briskly. So The buyer doesn’t have to remind the client again & again about payments.
f.Cost-Effective:
Unlike other electronic invoicing systems in the mart, e-invoicing software is highly cost-effective, especially specially designed for small & medium-sized businesses. So The pricing starts from just Rs. 999 per month.
Features of E-invoicing:
Bill Reference Number:
The new e-invoicing system generates a unique bill Reference Number for electronically uploaded invoices by the tab Registration Portal (IRP). IRN computes using a hash algorithm. It ensures that the supplier won’t upload the same invoice further than formally in a single fiscal time.
Digital Signature :
A digital sign is a process of electronically authenticating the E-Invoice that the specific supplier has submitted. The DCS generates per the guidelines mentioned in the IT Act, of 2000.
Quick Response Code :
It helps the tax officer to check the E-Invoices using an offline application. A QR law contains the following information:
- GSTIN of supplier
- GSTIN of the philanthropist
- Date of the invoice generation
- the supplier gives Bill Number
- Number of line goods
- Bill value
- Unique IRN
- HSN law of the main item
Real-Time Tracking of E-Invoices:
E-invoicing software allows the shadowing of checks in real-time prepared by the supplier. It also permits the brisk availability of input tax credits.
Easy Reporting of B2B Invoices:
Under the system of e-invoicing, the taxpayer must only report the E-Invoices formally. It also authenticates by the bill Registration Portal (IRP). After confirmation of the E-Invoice, a unique Invoice Reference Number is generated & the details are auto-populated.
E-way Bill Generation:
E-invoicing software makes the process of e-way bill generation very easy. So The taxpayer only has to add the vehicle details in Part A of the e-way invoice & get an auto-populated E-Invoice produced from the system, which gets fluently authenticated at the GST portal.
Simplifies The Process For Buyers:
The buyer can attune the E-Invoice with the purchase order & accept or reject the E-Invoice in real time. The E-Invoice, after authentication, transfers to the buyer’s email ID mentioned on the E-Invoice.
No More Frauds:
With e-invoicing software, the buyer & dealer can get assured that there will be no further fraud. Data is also available to the taxpayer & government authorities in real-time; thus, the chances of fraud are not there.
Reduced Errors:
Under the e-invoicing system, data auto-populates from e-invoicing software. Thus the chances of manual delusion are almost negligible.
FAQ & Related Questions:
1. Who has to issue an e-invoice?
Taxpayers must issue E-invoicing with turnover above 100 cr from 1 st of January 2021.
2. Do I need to use the GSTN portal for the issue of tax invoices going forward?
No, you still have to issue a tax invoice in your existing system, only that is accounting/billing. An E-invoice generates on the government portal.
3. Do I need to issue an invoice for taxable supplies or exempted or non-exempted GST supplies?
E-Invoice issue for taxable supplies only.
4. What is IRN?
IRN refers to an invoice reference number as a unique alphanumeric number issued by the GST server once the server validates the invoices.
5. What is a QR code?
QR code refers to a quick reference code, and it also generates along with IRN.
6. Do I need to print the QR code on the tax invoices?
Yes, the QR code prints on tax invoices.
Conclusion:
E-Invoicing has become one of the most strategic ways companies are taking toward the digitization of processing cycles. With governments worldwide, especially in Asia, introducing Authorization and working on enforcing a fabric to enable e-Invoicing similar to Peppol, for illustration, it is the right time to invest in e-Invoicing if you haven’t already and take your business to the position.