An e-invoicing system is where B2B companies get their invoices authenticated digitally by GSTN for various uses on the common GST portal. The virtual invoicing system will generate a unique identification number, which can be used for the Invoice Registration Portal (IRP) and managed by the GST Network (GSTN).
Why is e-invoice required?
E-invoicing is indispensable for people with big businesses. Here are some advantages of e-invoicing which shows its importance:
- Real-time tracking of invoices digitally
- Faster availability of input tax credit
- Reduces many input tax credit verification problems.
- Better management of client details
- Automation of the tax-filing process
Modes for generating E-Invoice
The various modes of generating E-invoice are:
- Web-based – Logging into the e-invoice portal and putting in the invoice data manually to generate the e-invoice.
- API/GSP based – Third-party software (Secure Folder, Excel Connector, Direct Database Access, Interface to access ERPs (Pull) and Click Button in ERP (Push))
- Offline tool based – Generating e-invoice through an offline excel tool where the information can be transferred and sent out to the IRP to create the IRN.
What happens if e-invoice is not generated?
If e-invoice is not registered on IRP, the document cannot be considered a valid tax invoice for all GST calculations. As a result, the authorities are entitled to deduct a penalty of Rs 10,000 for every case of non-compliance.
e-invoicing portal purpose
Taxpayers with a turnover of more than Rs 20 crore can begin using the e-invoicing system on a trial basis for their benefit and convenience. The website einvoice1-trial.nic.in is an exclusive platform for people who have a turnover above Rs 20 crore. Taxpayers who are located beyond the limits of Rs 20 crore are offered this e-invoicing system for their benefit and convenience. The portal helps taxpayers perform the following functions:
- Generation of unique Invoice Reference Number (IRN)
- Cancel IRN
- Generate MIS reports
- Authorise a sub-user to Generate IRN,
- Generate reports relating to IRN.
- Print invoice
- Validation of IRN
5 special options available in on e-invoicing portal post log in
Sub-menus available under the e-invoice menu are:
- E-invoice
- Generating the IRN: Taxpayers can now generate their unique IRN by inputting the correct details regarding invoice/debit or note/credit note. The website/IRP will then digitally sign the JSON of the e-invoice. It would also supply a unique QR code to readily access the invoice details.
- Generate Bulk IRN: The bulk generates option is extremely useful for those taxpayers who need to upload multiple invoices in a single JSON file. The JSON is sometimes generated by the bulk converter tool, which is contained on the website.
- Cancel IRN: If the taxpayer has made any mistake while uploading his/her details, the generated IRN has a provision to be cancelled within 24 hours of generation. Since the IRN cannot be deleted completely, even the IRN number of a cancelled invoice is unique. You can find the faulty invoice by entering the acknowledgment number on the portal.
- Print e-invoice: To print the IRN/e-invoice, the number of the invoice should be entered to get a downloadable pdf.
- MIS Reports- The MIS report is an option used to generate an MIS report on the portal. Taxpayers will be able to view a list of invoices when they enter the desired dates and perimeters. You can also export the report in an excel sheet using the ‘Export to Excel’ function.
- User Management- Since the taxpayers have more than Rs. 20 crore in turnovers, their business may employ people on a large scale. This means different people will be performing different roles in creating and dealing with invoices. The portal allows taxpayers to control access of such sub-users. All sub-users will be given different login credentials with their user ID matching the main user with a suffix. The function and limitations of a sub-user will be as follows:
- Generate Invoice Reference Number
- Report Generation of Invoice Reference Number
- Cancel Invoice Reference Number
- Update- Entering and re-entering details of a business is both tedious and time-consuming. However, you can avoid this problem every time an e-invoice is prepared. The auto-populate option will save data and enter them automatically by securing the data from the GST common portal.
- E-Way Bill: The ‘e-way bill’ option is usually used to complete Part A of the e-way bill. The vehicle number would then form the remaining Part B.
Cancellation and amendments in E-Invoice
- IRN can be cancelled within 24 hours (from the time of generation of IRN)
- However, if the connected e-way bill is active or verified by an officer during transit, cancellation of IRN will not be permitted
- In case of cancellation of IRN, GSTR-1 also will be updated with such ‘cancelled’ status
- Amendments are not possible on IRP
- Any changes in the invoice details reported to IRP can be carried out on the GST portal (while filing GSTR-1)
e-invoice portal layout and tab functions
Homepage
The homepage of the website will contain information on updates related to e-invoicing. Any new features will be notified and defined in this section.
- There is another ‘Laws’ section that will detail the different rules, forms, notifications, and circulars, which are important to the field of e-invoicing.
- The ‘Help’ heading is dedicated to user manuals. You will also find the FAQs sections here along with different tools like bulk generation.
- There is also a ‘Search’ section which contains detailed information on:
- Details of the taxpayer, which can be viewed with their respective GSTIN.
- Service details that are available by entering the HSN Code.
- Verification of a signed invoice.
- Current status of the e-invoice of the taxpayer.
- GSTINs generating IRN.
- The ‘Contact Us’ heading will provide you with a support email address and mobile number for additional help.
- The ‘Registration’ section is important for first-time users who need to register on the website if they want to use the e-invoicing system. The registration facility allows various forms of registration like SMS-based, mobile-based, GSP-based, API-based, and so on. The generation of the e-invoice will depend on the selection made by the taxpayer during the registration.
- The ‘Login’ section is to access the newly created accounts by entering accurate credentials.
Must know facts
Is e-invoicing mandatory for export?
Yes, all businesses dealing with exports need to have e-invoicing facilities. It is compulsory for them to register on the E-Invoicing portal – Invoice Registration Portal (IRP). Failure to secure e-invoicing may have monetary penalties.
Is e-invoice mandatory for non GST supply?
No, enterprises dealing with non-GST supplies need not have e-invoicing for their business. Any nil-rated or wholly-exempt supplies are not considered under e-invoicing. You should only produce a bill of supply in replacement of tax invoices.
What is the difference between challan and invoice?
An invoice refers to the legal document proof of the ownership of any good or service offered by enterprises. Additionally, it includes all associated risks and liabilities it carries along. The invoice also gives the exact and actual value of the goods and services. A delivery challan on the other hand is a simple document. It only denotes the customer’s acknowledgement that the goods have been delivered.