E-Invoicing

 

On 8th March 2021, the CBIC notified applicability of the e-invoicing system from 1st April 2021 for businesses with total turnover ranging between Rs. 50 Crore to Rs. 100 Crore. The government recently extended the e-invoicing applicability to businesses having more than Rs 20 crore turnover w.e.f. 1st April 2022 (in any financial year from FY 2017-18 onwards)

 

1. What is e-Invoicing?

e-invoice is a Tax Invoice which is normally issued by every registered taxpayer, but it contains some additional information in the form of QR Code. The tax invoice generated through accounting software i.e., Tally, Busy etc. are transmitted on the IRP i.e., on Invoice Registration Portal or say e-invoicing portal in json file in accordance with e-invoice schema in INV-01. The government portal validates the information and return back the json file with digital signature after generating IRN (unique invoice reference number for each invoice) and adding a QR Code. The said json file is imported in the Accounting/ ERP system that enables

invoice to be printed with QR Code.
 

2. Who is liable to issue e-Invoice and when it is applicable?

• Registered person whose aggregate annual turnover in any preceding financial year from 2017-18 onwards exceeds Rs. 20 Cr are liable for e-Invoicing.
• E-Invoicing applies to supply of goods or services or both.
• E-Invoicing applies to export (with or without payment) also.
• Applies to B2b transactions only.
• Applies to supplies to SEZ Unit
• Applies to Deemed Export.

 

3. How to calculate aggregate turnover?

Inclusions: Taxable supplies, Exempt supplies, Non-taxable supply, Export of goods, Export of services, Inter-State supplies of persons having same PAN, supplies without consideration [Schedule I]

Exclusion: Inward supplies on which tax is payable under RCM, CGST, SGST, IGST and cess to be computed on PAN India basis.

 

4. In case in any previous FY from 17-18 turnover was within 100crs however in current FY turnover exceeded 100 crs whether e-invoicing is applicable for current year?

No e-invoicing is not applicable in current FY as turnover in any preceding year was less than 100 crs e-invoice would be applicable in succeeding FY April onwards

 

5. Whether Invoice Reference Number i.e., IRN [64 characters] is mandatory when issuing e-invoice to customers?

IRN number is not mandatory in invoice when issuing Provided Quick Response (QR) code having embedded IRN in it suggested to store IRN in one’s ERP
 

6. Documents covered under e-Invoicing?

• Tax Invoice
• Debit Note
• Credit Note
• Export
• Any other document as notified under GST law to be reported as e-invoice by the creator of the document
   

7. What data is embedded in QR Code?

The QR code will consist of the following key particulars of e-invoice:

a. GSTIN of Supplier

b. GSTIN of Recipient

c. Invoice number, as given by Supplier

d. Date of generation of invoice

e. Invoice value (taxable value and gross tax)

f. Number of line items

g. HSN Code of main item (line item having highest taxable value)

h. Unique IRN (Invoice Reference Number/hash)

i. IRN Generation Date
 

8. What is the Process to Generate GST E-Invoice?

The process of generating the GST e-invoice will be the same as the e-way bill which is generated on the https://ewaybill.nic.in/ portal or the GST payments done on the GSTN portal for the movements of goods.

 

9. How will the e-Invoicing mechanism get merged with the GST Return system?

The invoices will get auto populated on the relevant GST return once they are signed and verified by the invoice registration system. Once document verification is done, the invoices will get directed to the recipient of supply for re-confirmation (as directed by the new invoicing law). The prime objective of the law is to auto-populate the taxpayer’s invoice details to his GST returns and reduce the chances of errors while reconciliation.

To be noted: Once the invoice data is verified the information gets auto populated in the respective taxpayer’s GST returns, thus eliminating the need to re-enter the digits.

10. Is it mandatory for the supplier to digitally sign the e-invoice again?

There is no need for the supplier to digitally sign the e-invoice which is to be uploaded on IRP. The e-invoice will automatically get signed after validation.

 

11. Is it possible to make changes in an e-invoice?

Yes, it is possible to make changes in the e-invoice only when the details are uploaded in GST returns. All amendments to an e-invoice can be made only on the GST Portal.

 

12. Can one partially cancel a reported e-invoice?

No. It has to be cancelled in total. No partial cancellation of reported e-invoice allowed. Cancellation of invoices is governed by Accounting Standards and any other applicable rules/regulations.
 

13. Exemption form E-Invoices under GST?
    A) Entity Level: Irrespective of the turnover, e-Invoicing shall not be applicable to the following categories of registered persons for now:

• An insurer or a banking company or a financial institution, including an NBFC
• A Goods Transport Agency (GTA)
• A registered person supplying passenger transportation services
• A registered person supplying services by way of admission to the exhibition of cinematographic films in multiplex services.
• Input Service Distributor.
• An SEZ unit

 

B) Transaction Level:

• E-Invoicing is not applicable for import Bills of Entry.
• Business to consumer Transactions.
• Non-GST Supplies (Alcoholic Liquor, Petrol and other).

C) Documents Level: – Following Documents that are not be covered under E-Invoicing Systems are as follows:

• Bill of Supply
• Self-Invoice in case of RCM u/s 9(4)
• Delivery Challan
• Advance Receipts Voucher.
   

14. What are the modes available for getting e-Invoices Registered?

Multiple modes will be made available for getting e-Invoices registered on the Invoice Registration Portal (IRP). Some of the proposed modes are-

• Web based
• API based
• Offline tool based and
• GSP based.

15.  Can an e-Invoice be cancelled partially/fully?

An e-Invoice cannot be partially cancelled, it has to be cancelled fully. Once cancelled, it will need to be reported into the IRN within 24 hours. A cancellation done after 24 hours cannot be done on the IRN and needs to be manually cancelled on the GST portal before the returns are filed.

 

16.  What if I have generated an Invoice by mistake and it is not cancelled within 24 hours?

 One may cancel in its Books of Accounts. Do not report the Invoice in your GST Returns i.e., Manually delete in GSTR-1. Such above situation would result into differences between GST portal and IRP and same would be flagged and reported to concerned jurisdictional officer thereafter justification on reasonable basis to be provided to department
 

17. Whether e-invoicing is applicable for invoices between two different GSTINs under same PAN [such as branches of co located in different States]?

e-invoicing is applicable to such distinct person having different GSTINs but same PAN and there is no exception given to them.

 

18. Whether invoice raised as B2C, later customer provides GSTIN could be amended to be B2B?

There is no option to make amendments in e-invoicing, one needs to issue GST credit note (within next Sept of FY for which invoice pertains) then raise new B2B e-invoice
 

 

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