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The transportation of goods from one place to another is facilitated by the filing of ‘e-Way Bills’ on the common GST portal. Similarly, in its 35th meeting, the GST Council had decided to implement a system of e-Invoicing, which will apply to specific categories of persons. e-Invoicing does not imply the generation of invoices on the GST portal. That would be a myth. Instead, e-invoicing involves the submission of an already generated standard invoice on a common e-invoice portal. Thus, it automates multi-purpose reporting with a one-time input of invoice details. The CBIC notified a set of common portals to prepare e-invoices via Notification No.69/2019 – Central Tax.
ClearTax provides the best-in-class e-invoicing solution for businesses. ClearTax also provides an e-Invoicing Tally Connector, enabling taxpayers to perform e-invoicing activities without leaving a tally screen. ClearTax will ensure a safe migration to an upgraded UI with no changes to your historical data.
ClearTax offers various modes through which e-invoice can be generated by the taxpayers, such as the seamless API integrations, Excel mode, FTP, SFTP or Tally connector. The user can enjoy numerous value additions such as:
‘e-Invoicing’ or ‘electronic invoicing’ is a system in which B2B invoices are authenticated electronically by GSTN for further use on the common GST portal. Under the electronic invoicing system, an identification number will be issued against every invoice by the Invoice Registration Portal (IRP), managed by the GST Network (GSTN). The National Informatics Centre launched the first IRP at einvoice1.gst.gov.in.
All invoice information will be transferred from this portal to both the GST portal and e-way bill portal in real-time. Therefore, it will eliminate the need for manual data entry while filing GSTR-1 returns and generation of part-A of the e-way bills, as the information is passed directly by the IRP to the GST portal.
The first phase of e-invoicing was implemented from 1st October 2020 for taxpayers with an aggregate turnover exceeding Rs.500 crore per Notification No 61/2020-Central Tax and 71/2020-Central Tax. In the next phase, the e-invoicing has been extended to businesses with an aggregated turnover exceeding Rs.100 crore from 1st January 2021 as per Notification No. 88/2020.
Later, the CBIC notified via Notification No. 5/2021 that e-invoicing will be applicable from 1st April 2021 for businesses with a turnover of more than Rs.50 crore. The taxpayers must comply with e-invoicing if the turnover exceeds the specified limit in any financial year from 2017-18 to 2019-20. Also, the aggregate turnover will include the turnover of all GSTINs under a single PAN across India.
However, irrespective of the turnover, e-Invoicing shall not be applicable to the following categories of registered persons for now, as notified in CBIC Notification No.13/2020 – Central Tax:
Currently, businesses generate invoices through various software, and the details of these invoices are manually uploaded in the GSTR-1 return. Once the respective suppliers file the GSTR-1, the invoice information is reflected in GSTR-2A for the recipients for viewing only. On the other hand, the consignor or transporters must generate e-way bills by again importing the invoices in excel or JSON manually.
Under the e-invoicing system (to be implemented from 1st October 2020), the process of generating and uploading invoice details will remain the same. It will be done by importing using the excel tool/JSON or via API integration, either directly or through a GST Suvidha Provider (GSP). The data will seamlessly flow to GSTR-1 preparation and for the e-way bill generation too. The e-invoicing system will be the key tool to enable this.
The following are the stages involved in generating or raising an e-invoice.
A taxpayer can continue to print his invoice as being done presently with a logo. The e-invoicing system only mandates all taxpayers to report invoices on IRP in electronic format.
Businesses will have the following benefits by using e-invoice initiated by GSTN:
It will help in curbing tax evasion in the following ways:
e-Invoice must primarily adhere to the GST invoicing rules. Apart from this, it should also accommodate the invoicing system or policies followed by each industry or sector in India. Certain information is made mandatory, whereas the rest of it is optional for businesses. Many fields are also made optional, and users can choose to fill up relevant fields only. It has also described every field along with the sample inputs for the interested users. One can see that certain required fields from the e-way bill format are included now in the e-invoice, such as the sub supply type.
Below is the gist of the contents of the latest e-invoice format as notified on 30th July 2020 via Notification No.60/2020 – Central Tax:
The following fields must be compulsorily be declared in an e-invoice:
|Sl. no.||Name of the field||List of choices/ specifications/sample Inputs||Remarks|
|1||Document Type Code||Enumerated List such as INV/CRN/DBN||Type of document must be specified|
|2||Supplier_Legal Name||String Max length: 100||Legal name of the supplier must be as per the PAN card|
|3||Supplier_GSTIN||Max length: 15 Must be alphanumeric||GSTIN of the supplier raising the e-invoice|
|4||Supplier_Address||Max length: 100||Building/Flat no., Road/Street, Locality, etc. of the supplier raising the e-invoice|
|5||Supplier_Place||Max length: 50||Supplier’s location such as city/town/village must be mentioned|
|6||Supplier_State_Code||Enumerated list of states||The state must be selected from the latest list given by GSTN|
|7||Supplier Pincode||Six digit code||The place (locality/district/state) of the supplier’s locality|
|8||Document Number||Max length: 16 Sample can be “ Sa/1/2019”||For unique identification of the invoice, a sequential number is required within the business context, time frame, operating systems and records of the supplier. No identification scheme is to be used.|
|9||Preceeding_Invoice_Reference and date||Max length:16 Sample input is “ Sa/1/2019” and “16/11/2020”||Detail of original invoice which is being amended by a subsequent document such as a debit and credit note. It is required to keep future expansion of e-versions of credit notes, debit notes and other documents required under GST.|
|10||Document Date||String (DD/MM/YYYY) as per the technical field specification||The date when the invoice was issued. However, the format under explanatory notes refers to ‘YYYY-MM-DD’. Further clarity will be required. Document period start and end date must also be specified if selected.|
|11||Recipient_ Legal Name||Max length: 100||The name of the buyer as per the PAN|
|12||Recipient’s GSTIN||Max length: 15||The GSTIN of the buyer to be declared here|
|13||Recipient’s Address||Max length: 100||Building/flat no., road/street, locality, etc. of the supplier raising the e-invoice|
|14||Recipient’s State Code||Enumerated list||The place of supply state code to be selected here|
|15||Place_Of_Supply_State_ Code||Enumerated list of states||The state must be selected from the latest list given by GSTN|
|16||Pincode||Six digit code||The place (locality/district/state) of the buyer on whom the invoice is raised/ billed to must be declared here if any|
|17||Recipient Place||Max length: 100||Recipient’s location (City/Town/Village)|
|18||IRN- Invoice Reference Number||Max length: 64 Sample is ‘a5c12dca8 0e7433217…ba4013 750f2046f229’||At the time of the registration request, this field is left empty by the supplier. Later on, a unique number will be generated by GSTN after uploading the e-invoice on the GSTN portal. An acknowledgement will be sent back to the supplier after the successful acceptance of the e-invoice by the portal. IRN should then be displayed on the e-invoice before use.|
|19||ShippingTo_GSTIN||Max length: 15||GSTIN of the buyer himself or the person to whom the particular item is being delivered to|
|20||Shipping To_State, Pincode and State code||Max length: 100 for state, 6 digit pincode and enumerated list for code||State pertaining to the place to which the goods and services invoiced were or are delivered|
|21||Dispatch From_ Name, Address, Place and Pincode||Max length: 100 each and 6 digit for pincode||Entity’s details (name, and city/town/village) from where goods are dispatched|
|22||Is_Service||String (Length: 1) by selecting Y/N||Whether or not supply of service must be mentioned|
|23||Supply Type Code||Enumerated list of codes Sample values can be either of B2B/B2C/ SEZWP/S EZWOP/E XP WP/EXP WOP/DE XP||Code will be used to identify types of supply such as business to business, business to consumer, supply to SEZ/exports with or without payment, and deemed export.|
|24||Item Description||Max length: 300 The sample value is ‘Mobile’ The schema document refers to this as the ‘identification scheme identifier of the Item classification identifier’||Simply put, the relevant description is generally used for the item in the trade. However, more clarity is needed on how it needs to be described for every two or more items belonging to the same HSN code.|
|25||HSN Code||Max length: 8||The applicable HSN code for particular goods/service must be entered|
|26||Item_Price||Decimal (12,3) Sample value is ‘50’||The unit price, exclusive of GST, before subtracting item price discount, can not be negative|
|27||Assessable Value||Decimal (13,2) Sample value is ‘5000’||The price of an item, exclusive of GST, after subtracting the item price discount. Hence, gross price (-) discount = net price item, if any cash discount is provided at the time of sale|
|28||GST Rate||Decimal (3,2) Sample value is ‘5’||The GST rate represented as a percentage that is applicable to the item being invoiced|
|29||IGST Value, CGST Value and SGST Value Separately||Decimal (11,2) Sample value is ‘650.00’||For each individual item, IGST, CGST and SGST amounts have to be specified|
|30||Total Invoice Value||Decimal (11,2)||The total amount of the Invoice with GST. Must be rounded to a maximum of 2 decimals|
The e-invoice format notified is as follows:
1. To whom will e-invoicing apply
A: The e-invoicing system shall apply to the GST registered persons whose aggregate turnover in the financial year exceeds Rs.50 crore. However, exceptions include Special Economic Zones (SEZ) units, insurance, banking, financial institutions, NBFCs, GTA, passenger transportation service, and sale of movie tickets.
2. Can an e-invoice be cancelled partially/fully?
A:An e-invoice cannot be cancelled partially but can be cancelled wholly. On cancellation, it must be reported to the IRN within 24 hours. Any attempt to cancel thereafter cannot be done on the IRN and must be manually cancelled on the GST portal before the returns are filed.
3. Will the bulk uploading of invoices for the generation of IRN be possible?
A: No, invoices must be uploaded one at a time into the IRP. The ERP of a business will need to be designed to place the request for the upload of individual invoices.
4. Will there be a facility for e-invoice generation on the common GST portal?
A: No, invoices will continue to be generated on the individual ERP software currently in use by businesses. The invoice must adhere to the e-invoicing standard format and include the mandatory parameters. The direct generation of invoices on a common portal is not being planned at the moment.
5. What are the types of documents that are to be reported into the IRP?
A: The documents that will be covered under the e-invoicing system are as follows-
For more FAQs on e-Invoicing, read our article on e-Invoicing FAQs.