e-Invoice under GST

E-Invoice is a standard format of the invoice recommended by the GSTN for the registered GST suppliers. There is a misconception that e-invoicing means the generation of invoices from a GSTN Portal. The fact is that E invoice can be generated using your existing accounting system / ERP or excel based tools provided by GSTN.

Existing software can improve their working by providing a facility to syncronize data with GSTN portal, so they can automatically create IRN Number on GSTN portal and update the same in their data. They may also need to provide a facility to print this information along with QR code on the invoices. Modern accounting softwares, such as Tez ERP have a facility to upload, syncronize, cancel and print e-Invoices.

1. Who needs to generate an e-Invoice?

e-Invoicing was made applicable from 1-Oct-2020 for businesses whose turnover has exceeded Rs.500 crore in preceding financial year. It is applicable from 1-Jan-2021 for businesses with turnover exceeding Rs.100 crore.
However, e-Invoicing shall not be applicable to categories notified in CBIC Notification No. 13/2020 - Central Tax, irrespective of the turnover.

2. Benefits of e-Invocing for businesses

E-invoice simplifies data reconciliation under GST and reduces chances of any mismatch. Availing ITC (Input Tax Credit) is faster and simpler. It also reduces the possibility of audits and surveys by the tax authorities since the information they required is available at a transaction level.

3. e-Invoicing helps curb tax evasion

With e-Invoicing, tax authorities will have access to transactions as they take place in real-time. There will be less chances of manipulation since the invoice gets generated prior to carrying out a transaction. This will reduce the chances of fake GST invoices and only the genuine ITC (input tax credit) will be claimed. Since the input credit can be matched with output tax details, it will be easier for GSTN to track fake tax credit claims.

4. How does e-invoicing work?

The following are the stages involved in generating or raising an e-invoice.
  1. Taxpayer needs to registers on the e-Invoicing portal, select a GSP and create a user for e-Invoicing.
  2. The taxpayer uses his ERP to generate a regular invoice, and then chooses to upload this invoice on the GSTN portal
  3. GSTN portal validates the invoice and generates a unique IRN (Invoice Registration Number). It also provides a unique Acknowledgement Number and date.
  4. ERP updates the IRN No. along with Ack. No. and date in the system
  5. The taxpayer prints the invoices along with the IRN No., Ack. No., Ack. date and the QR Code containing information about the invoice.
  6. In case of any changes in the invoice after generating the Invoice, the taxpaer needs to cancel the Invoice and generate a new Invoice
  7. Taxpayer can cancel the invoice using his ERP, wherein the ERP cancels the invoice in the ERP and on the GSTN portal and updates Cancellation No. and date in the system
  8. ERP also has a facility to update the registration or cancellation details of any invoice from the GSTN portal, in case the invoice has been registered or cancelled direcly on GSTN portal.

5. What are the mandatory information required on an e-invoice?

E-invoice must adhere to the GST invoicing rules. Following information is requred on e-invoice as notified on 30th July 2020 via Notification No.60/2020:

Sr. Field Particulars 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 “HO-2020-21/1” 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 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.
10 Recipient_ Legal Name Max length: 100 The name of the buyer as per the PAN
11 Recipient’s GSTIN Max length: 15 The GSTIN of the buyer to be declared here
12 Recipient’s Address Max length: 100 Building/Flat no., Road/Street, Locality, etc. of the supplier raising the e-invoice
13 Recipient’s State Code Enumerated list The place of supply state code to be selected here
14 Place_Of_Supply_State_ Code Enumerated list of states The state must be selected from the latest list given by GSTN
15 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
16 Recipient Place Max length: 100 Recipient’s location (City/Town/Village)
17 IRN-Invoice Reference Number Max length: 64 At the time of registration request, this field is left empty by the supplier. Later on, a unique number will be generated by GSTN after uploading of 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 e-invoice before use.
18 ShippingTo_GSTIN Max length: 15 GSTIN of the buyer himself or the person to whom the particular item is being delivered to
19 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
20 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
21 Is_Service String (Length: 1) by selecting Y/N Whether or not supply of service must be mentioned
22 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 type of supply such as business to business, business to consumer, supply to SEZ/Exports with or without payment, and deemed export.
23 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 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
24 HSN Code Max length: 8 The applicable HSN code for particular goods/service must be entered
25 Item_Price Decimal (12,3) Sample value is ‘50’ The unit price, exclusive of GST, before subtracting item price discount, can not be negative
26 Assessable Value Decimal (13,2) Sample value is ‘5000’ The price of an item, exclusive of GST, after subtracting item price discount. Hence, Gross price (-) Discount = Net price item, if any cash discount is provided at the time of sale
27 GST Rate Decimal (3,2) Sample value is ‘5’ The GST rate represented as a percentage that is applicable to the item being invoiced
28 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
29 Total Invoice Value Decimal (11,2) The total amount of the Invoice with GST. Must be rounded to a maximum of 2 decimals


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