What is E-Invoicing?
With the objective of enhanced interoperability and uniform interpretation across the entire Goods and Service Tax (GST) eco-system, electronic invoicing or e-invoicing has been implemented in a phased manner in India, starting 1 October 2020.
E-invoicing under GST requires getting all invoices to be registered with the government on the Invoice Registration Portal (IRP) and generating a unique Invoice Reference Number (IRN). Only a registered e-invoice with IRN is considered as a valid invoice.
E-invoicing has brought in a major change in core business processes, demanding a holistic review of current frameworks. With these new changes, businesses would need to reassess their readiness and review technology related changes needed within their IT landscape.
We at BDO in India, offer an end-to-end automated invoice solution to manage e-invoice compliances securely and seamlessly, ensuring minimum changes to current processes while leveraging the right tools needed to comply with new norms.
Key highlights of the solution
- Standard mandatory and optional fields to register invoice and credit/debit note transactions
- Extraction of correct data in specified format from the company’s ERP/ accounting system
- Validation and calculation checks in compliance with the provisions of law
- Generation of IRN and QR code on real-time basis before movement of goods and on the supply of services
- Printing of registered e-invoice with IRN, QR code, company’s logo and other mandated details
- Cancellation/amendment of invoices
- Option to generate applicable e-way bill with e-invoice
BDO India's e-invoicing solution offers
- Impact assessment & solution design to enable automated compliance management for e-invoice, e-way bill and GST returns
- Automation to manage large volumes with secured APIs or SFTP mode for seamless data transfer
- Automating the e-invoice compliance process, in instances where companies have a standardised global ERP system, without changing core IT policies
- SAP Certified GSP solution for SAP customers with API services for e-invoice, e-way bill and GST returns automation
- B2C QR code and printing of B2C invoices can be configured
- Seamless integration for all GST compliances including e-invoice, e-way bill and GST returns - a distinct solution offering
- Reverse integration to provide IRN, QR code & e-way bill details back to the company’s ERP system
- Reconciliation between transactions submitted through e-invoice, e-way bill and GST returns
- Manual generation and download of digitally signed e-invoice with QR code in JSON/CSV/Excel format
- Customising invoice printing after generation of e-invoice in company specific format
1. What is an e-invoice?
E-invoice is an electronic invoice through which a supplier has obtained an IRN and Quick Reference (QR) code by uploading specified particulars on the government authorised IRP.
2. Why is e-invoice relevant?
An invoice without an IRN will not be treated as a ‘valid’ invoice for the purpose of GST law. Therefore, non-adherence will tantamount to non-compliance.
3. Who is liable to issue an e-invoice?
E-invoicing became applicable from 1 October 2020 for suppliers having aggregate turnover (computed as per the provisions of GST law) of more than INR 500 crores in any financial year beginning from 1 July 2017. In the second phase of its implementation, this scope was extended to suppliers having aggregate turnover within the range of INR 100 crores to INR 500 crores, with effect from 1 January 2021. Further to this, recently it has been announced that the suppliers within the aggregate turnover range of INR 50 crores to INR 100 crores will also be covered within the scope of e-invoicing with effect from 1 April 2021.
However, it must be noted that relaxation from issuing e-invoices has been given to certain class of persons, irrespective of the amount of aggregate turnover. This includes SEZ units, banking companies, financial institutions including NBFCs, insurance companies, Goods Transport Agencies, providers of passenger transportation services and services by way of admission to exhibition of cinematographic films in multiplex screens.
4. Turnover for which financial year is to be calculated for determining liability to issue e-invoices?
It is mandated for registered persons whose aggregate turnover (based on PAN) in any previous financial year beginning from 1 July 2017 is more than the turnover eligibility limit set for e-invoicing.
5. Is e-invoicing applicable to all types of documents generated by a taxpayer
No. E-invoicing is applicable to
- Tax invoices
- Debit notes & credit notes
- Export invoices
6. Is e-invoicing required for RCM invoices?
E-invoicing is not required for self-invoices (i.e. inward RCM invoices). However, for outward RCM transactions, an IRN will be required to be generated by the supplier of those services.
7. How does a person check whether he is liable to issue e-invoices?
An assessee can visit the website – Click on the ‘Search’ tab and then click on ‘e-invoice status of taxpayer’.The status can be seen on entering the GSTIN of the taxpayer.
Note: In case a taxpayer who is not required to issue e-invoice see their GSTIN appearing as ‘enabled’ on e-invoice portal, they may write to [email protected]
8. What is a QR code?
A QR code is a digitally signed code received from the IRP at the time of generation of an IRN. The code shall contain certain important invoice details viz. (i) GSTIN of supplier; (ii) GSTIN of recipient; (iii) invoice number as given by supplier; (iv) date of generation of invoice; (v) invoice value (taxable value and gross tax); (vi) number of line items; (vii) HSN code of main item (the line item having highest taxable value); and (viii) Invoice Reference Number (IRN). The said details shall be readable by any person who scans the QR code using the application provided by NIC or any other QR code reader.
9. Is it mandatory to print the QR code on the face of the e-invoice? Can the same be printed on a separate sheet?
The QR Code has to be printed by the taxpayer on the invoice copy issued to a buyer. It must be noted that the QR code cannot be printed on a separate paper.
10. What shall be the size of the QR code on the invoice?
The size of the QR code shall be such that it is readable by a QR code reader. The placement/ positioning of the code on the invoice is the choice of the supplier.
11. Is a supplier required to sign the e-invoice generated from the IRP?
The e-invoice would be digitally signed by the IRP. Further, it would also tantamount to be an invoice under the Information Technology Act, 2000. Hence, there is no requirement for the supplier to sign the invoice again.
12. If an IRN is generated, can it be deleted or cancelled?
Once an IRN is created for an invoice, the same cannot be deleted from the IRP. However, cancellation of the IRN may be done within 24 hours of its generation. It must also be noted that partial cancellation of invoice is not allowed. Invoice must be cancelled fully by the supplier.
13. Can a fresh IRN be generated on the same invoice number after cancellation of the IRN?
No. Once cancelled, the same invoice number cannot be used for generation of a new IRN.
14. What if an invoice has been generated with incorrect details and 24 hours have lapsed since generation of the IRN?
A credit/ debit note is required to be issued or an amendment has to be carried out on the GST portal. No editing can be done by a taxpayer on the IRP.
15. How is e-invoicing different from e-waybill?
E-invoicing has been introduced with the purpose of streamlining the GST compliances and easing the reconciliation of input credits. Further, e-invoicing is applicable for both supply of goods as well as services. On the other hand, e-waybill is meant for the sole purpose of tracking movement of goods.
16. Is generation of e-waybill separately required once e-invoice has been issued?
The taxpayer shall have an option to generate an e-waybill separately as well as automatic generation through e-invoice.
17. What are the various modes of generation of e-invoice?
There are multiple modes for generation of e-invoices –
- API based
- Mobile app based
- Offline tool based
- GST Suvidha Provider based
18. What steps are required to be taken by an eligible person for implementing e-invoicing?
At a very broad level, following are the activities required to be carried by the companies for implementation –
- Check whether their ERP has the requisite data that needs to be uploaded on the IRP for getting an IRN and a QR code.
- Check whether their ERP has the requisite data in the desired format that needs to be uploaded on the IRP.
- The data that needs to be uploaded on the government portal (IRP) comprises of mandatory and optional fields – what also needs to be evaluated is which of these optional fields business would want to upload/ report.
- If the data volume is large, evaluate whether the company wants to integrate their ERP (assuming ERP version allows such integration – this also needs to be checked) with the government portal for real time generation of IRN and QR code.
- If the data volume is not large, evaluate whether the company wants to manually upload the required data on the IRP – manual upload can happen either individually for each invoice or in batches for multiple invoices at one go. Again, the answer would depend upon the exact volume of data.
19. What is the estimated time taken for implementation of e-invoicing system for a taxpayer?
The average time varies approximately from 3 to 4 weeks depending upon various factors such as the level and type of integration, ERP readiness in terms of its version/ licensing restrictions, current shape and form of ERP vis-à-vis the requirements of the e-invoicing system etc.
20. Can persons with a turnover of less than INR 50 crores voluntary generate e-invoices?
No. Such persons cannot voluntarily generate e-invoices.
21. How can BDO in India help?
BDO in India can assist in the entire journey of implementation right from initial gap assessment/ advisory to technological alignment of ERPs for generating e-invoices.This would broadly include –
- Ascertaining ERP readiness in terms of compatibility and data availability
- Evaluating the extent of automation/integration required based on factors like nature and volume of transaction
- Comparing current reporting vis-à-vis what has been prescribed in law
- Suggesting various types of automation for generation of e-invoices
- Implementation and handholding in the entire process
22. Why BDO in India?
- One of the very few solutions certified by SAP
- Licenced ASP and GSP by Goods & Services Tax Network (GSTN)
- Expert tax professional involved in development of ASP tool
- Global leverage of technology and experience