E-Invoicing FAQs – Frequently Asked Questions under GST Act
Beginning on October 1, 2020, taxpayers with an aggregate revenue over Rs. 500 crore will be subject to the GST's e-Invoicing system and from January 1st, 2021, e-invoicing was made mandatory to companies with a combined turnover of more than Rs. 100 crore.
The CBIC also announced on March 8th 2021 that starting on April 1st 2021, company having annual sales between Rs. 50 crore and Rs.100 crore will be able to use the e-invoicing system. The government has extended the use of electronic invoicing to companies with annual revenue of more than Rs 20 crore, effective April 1, 2022.
The whole turnover of all GSTINs in India under a single PAN would be included in the aggregate turnover for e-invoicing. You can check and confirm the GSTIN for which you wish to raise the e-invoice using the GST search tool if you have several GSTINs on hand.
This article addresses numerous FAQs regarding the GST E-invoicing system.
A system of raising invoices known as electronic invoicing or e-Invoicing, enables invoices produced by one software to be read by any other software, obviating the need for any further data entry or mistakes. In other words, it is an invoice that is created in a standard format and whose electronic data may be exchanged electronically, assuring data interoperability.
As of October 1, 2020, all firms whose combined revenue has exceeded the ceiling of Rs. 500 crore in any of the prior fiscal years from 2017–18 to 2019–20 must issue invoices. E-invoicing also became mandatory for companies with a turnover of more than Rs. 100 crore on January 1, 2021, for any fiscal year between 2017–18 and 2019–20.
From April 1, 2021, it was also made available to companies with annual sales of more than Rs. 50 crore. The government has expanded the use of electronic invoicing to companies with annual revenue of more than Rs 20 crore, effective April 1, 2022.
Nevertheless, as stated in CBIC Notification No.13/2020 -Central Tax, the following types of registered persons shall not be subject toe-invoicing, regardless of turnover:
The following are some benefits of electronic billing:
Yes, reverse charge mechanism (RCM) transactions are covered by the e-invoice scheme.
Starting with FY 2017–18, the prior year's turnover should be taken into account to determine eligibility for e–invoicing. As a result, starting with the start of the following fiscal year, a business whose annual turnover surpasses the set threshold must create electronic invoices. For instance, e-invoicing will be used starting on April 1, 2021, if the threshold turnover was exceeded in the fiscal years 2020–21.
The Central Goods and Services Tax (CGST) Act's definition in Section 2(6) must be followed when calculating the total turnover fore-invoicing. The total turnover for the fiscal year 2017–18 is to be calculated from July 1 through March 31, 2018.
Currently, e-Invoicing is applicable to:
No, e-invoicing is not applicable to totally exempt or nil-rated supplies because a bill of supply, not a tax invoice, is issued in these circumstances.
No, you only need to report credit and debit notes to the IRP if they were issued in accordance with Section 34 of the CGST or SGST Acts.
Businesses will continue to create invoices on their separate ERPs in accordance with the e-Invoicing paradigm, exactly as they havein the past. To ensure a level of standardisation and the machine-readability of these bills, only the standard, schema, and format for the creation of invoices will be specified. The taxpayer will be responsible for producing the invoice.
It must be recorded at the time of generation to the GST Invoice Registration Portal (IRP). The IRP adds the digital signature for thee-Invoice, the OR code, and generates a special Invoice Reference Number (IRN) for it. The QR Code will hold the key information from the e-Invoice and provide it back to the taxpayer who created it in the first place.Additionally, the IRP will email the seller's registered email ID with the signed e-Invoice.
An workflow Invoice's had two main components. The interaction between the company/supplier and the invoice registration portal is the first phase (IRP). Invoices are created by the supplier, who then submits aJSON file of those invoices to the IRP. Before sending the invoice back to the supplier, the IRP verifies the data on it, creates an IRN and QR code, and digitally signs the document.
The process to create an e-invoice varies with the following four methods:
According to the GSTN's draught format, an e-Invoice will have the following components:
Data for fields with the label "Mandatory" must be submitted without fail.
If a necessary field is empty, it can be reported as nil.
The 'Optional' fields can be filled in or left blank. Only certain types of enterprises and situations are addressed by them.
Some of the 'Optional' portions of the e-invoice can have required fields. For instance, the portion titled "e-way bill details" is designated as "Optional." The 'Mode of Transportation' field, however, is required for this part.
The maximum number of line items allowed per e-Invoice is 1,000.
The Central Goods and Services (CGST) Rules, 2017, Rule 46applies in this situation. Rule 46 states that when issuing bills, the supplier or his authorised agent must sign or digitally sign them. A caveat to Rule 46, however, stipulates that if an electronic invoice is issued in compliance with the Information Technology Act of 2000, no signature or digital signature is necessary. Therefore, it has been determined that a supplier will not be required to sign or digitally sign the document in the event of e-invoices.
No placeholder for a company's logo will be included in thee-Invoice design. Although the company's accounting and billing software can accommodate this, the IRP will not receive the logo.
A notified person is required to create an invoice in accordance with Rule 48(4) of the CGST Rules by uploading the required information in Form GST INV-01 on the IRP after acquiring an IRN. According toRule 48(5), invoices issued by such notified people in any other way than that described in Rule 48(4) are not to be considered invoices. Therefore, if an invoice or debit/credit note is issued by a notified person, it will only be legally binding with an IRN.
The e-Invoicing programme will cover the following documents:
There will be a variety of ways to register e-Invoices on the Invoice Registration Portal (IRP). Some of the suggested modes include:
Here are the prerequisites for the generation of e-invoices:
Anyone can check an e-accuracy invoice's by uploading the signed JSON and using the option to "Verify Signed Invoice" under the"Search" option. The QR code printed on the invoice can also be verified by downloading the QR Code Verify app.
No, the e-invoice system makes sure that the same invoice from the same supplier pertaining to the same financial year is not uploaded again in order to generate more than one IRN by checking in the CentralRegistry of the GST system. Such bills will be denied by the IRP.
No, the same invoice number cannot be used to create a new invoice once an IRN has been cancelled. The IRP will reject the same if it issued again.
Yes, the e-commerce operator may create e-invoices on behalf of such suppliers if they are informed individuals required to record invoices under Rule 48(4) and sell through an e-commerce firm.
An e-invoice must be fully cancelled; it cannot be partially cancelled. It must be reported on the IRN within 24 hours of being cancelled.After 24 hours, cancellations cannot be made on the IRN and must be made manually on the GSTR-1 return on the GST portal before filing.
Only on the GST site in the GSTR-1 return can changes to an e-invoice be made.
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