GST E-Invoice Software in India
e-Invoicing is an electronic system where B2B invoices are authenticated by the GST Network (GSTN) before being submitted to the common GST portal. Initially designed for large enterprises, it has since been expanded to include smaller businesses.
Rather than generating invoices directly on the GST portal, e-Invoicing involves submitting pre-generated invoices to a common portal. The Invoice Registration Portal (IRP) assigns a unique Identification Number (IRN) to each invoice. This system automatically transfers invoice data to both the GST portal and the e-way bill portal, eliminating manual data entry during GSTR-1 filing and e-way bill generation.
LATEST UPDATES:
Date |
Update Description |
|---|---|
17th December 2024
|
Mandatory Two-Factor Authentication (2FA) for Taxpayers
- 2FA for businesses with AATO over Rs. 20 Crore: Effective from 1st Jan 2025.
- 2FA for businesses with AATO between Rs. 5 Crore to Rs. 20 Crore: Effective from 1st Feb 2025.
- 2FA for all taxpayers: Effective from 1st Apr 2025 for generating e-invoices and e-way bills.
- E-way bill validity capped at 360 days from 1st Jan 2025.
|
5th November 2024
|
E-Invoicing Reporting Timeline
- Taxpayers with AATO Rs. 10 Crore and above must report e-invoices on the IRP portal within 30 days.
- Effective from 1st Apr 2025.
|
9th September 2024
|
E-Invoicing for B2C Transactions
- Phased implementation of e-invoicing for B2C transactions recommended by GST Council.
- Previously mandatory for B2B transactions for turnover exceeding Rs. 5 Crore.
|
12th June 2023
|
Mandatory Two-Factor Authentication (2FA) for Taxpayers with Over Rs. 100 Crore Turnover
- Effective from 15th July 2023. 2FA required for e-invoicing and e-way bill systems.
|
This table format clearly highlights the key updates on GST regulations and the specific dates for their implementation.
The e-invoicing system was implemented to streamline GST return filing and enhance reconciliation accuracy. Here’s a quick overview of its key benefits:
- Efficient Reporting & Record-Keeping: E-invoicing allows for one-time reporting of B2B invoices at the point of generation, simplifying sales and purchase registers. This automation aids in accurate and efficient GST return preparation.
- Automated Tax Filing & E-Way Bill Generation: Integrated e-invoice data auto-populates return forms on the GST portal, reducing manual effort. Additionally, e-way bills can be seamlessly generated, improving logistics and transportation processes.
- Enhanced Reconciliation & Real-Time Tracking: E-invoicing minimizes discrepancies between financial records and GST filings, reducing errors. It also speeds up input tax credit validation, resulting in quicker financial turnovers.
- Fraud Prevention: The real-time data access enhances tax authorities’ ability to detect and prevent fraudulent activities, eliminating the generation of fake invoices and ensuring GST compliance.
- Reduced Audits & Better Financial Management: Transaction-level data minimizes audit chances and the administrative burden of tax compliance. This transparency fosters better financial management, cash flow, and trust.
- Minimized Tax Evasion: Since e-invoices are generated prior to transactions, the risk of altering invoices is greatly reduced, further curbing tax evasion.
If your business meets the applicable turnover threshold and engages in any of the following transactions, you are required to generate e-invoices through the GST portal:
Documents Requiring e-Invoicing:
- Tax Invoices: Standard invoices for the sale of goods or services.
- Credit Notes: Issued for reducing the value of taxable supplies.
- Debit Notes: Issued for increasing the value of taxable supplies.
Transactions Requiring e-Invoicing:
- Business-to-Business (B2B) Sales: Taxable sales of goods or services to registered businesses.
- Business-to-Government (B2G) Sales: Sales made to government bodies.
- Exports and Deemed Exports: Goods or services supplied to foreign countries or treated as exports under GST.
- Supplies to Special Economic Zones (SEZs): With or without tax payment.
- Stock Transfers or Supplies to Distinct Persons within an SEZ: Movement of goods or services within SEZs.
- Transactions with SEZ Developers: Sales or supplies made to SEZ developers.
- Supplies under Reverse Charge Mechanism (RCM): Supplies made under the provisions of Section 9(3) of the CGST Act.
- Generate Invoice: Create a standard invoice using your accounting or ERP software.
- Upload to IRP: Submit the invoice to the GST Invoice Registration Portal (IRP) using JSON, Excel, or API.
- IRP Validation: The IRP validates the invoice details and generates a unique Invoice Reference Number (IRN).
- E-Invoice Generation: The IRP sends the e-invoice back with the IRN and a QR code.
- File GSTR-1: Use the e-invoice data to auto-populate your GSTR-1 return.
- E-Way Bill: If required, generate the e-way bill using the e-invoice details.
Here's the table for the e-Invoice applicability based on turnover criteria:
Phase |
Applicable to Taxpayers with Aggregate Turnover of More Than |
Applicable Date |
Notification Number |
|---|---|---|---|
VI
|
Rs 5 Crore
|
01.08.2023
|
10/2023 - Central Tax
|
This table outlines the various phases, the turnover criteria, applicable dates, and corresponding notification numbers for e-Invoice applicability.
E-Invoicing Compliance Based on Turnover Criteria:
Taxpayers are required to comply with e-invoicing if their Annual Aggregate Turnover (AATO) exceeds the specified threshold in any financial year from 2017-18 to 2021-22. The turnover for e-invoicing compliance includes the total turnover across all GSTINs registered under a single PAN, across India.
If a business’s turnover in the last financial year was below the threshold but exceeds it in the current financial year, the e-invoicing requirement will apply from the start of the next financial year.
Example 1: ABC Ltd
- FY 2017-18: Rs 15 crore
- FY 2018-19: Rs 17 crore
- FY 2019-20: Rs 24 crore (Exceeds Rs 20 crore threshold)
- FY 2020-21: Rs 19 crore
- FY 2021-22: Rs 18 crore
Compliance Requirement: Since ABC Ltd exceeded the Rs 20 crore turnover threshold in FY 2019-20, it is required to generate e-invoices starting from 1st April 2022, irrespective of the turnover in subsequent years.
Example 2: QPR Ltd
- FY 2019-20: Rs 4 crore
- FY 2020-21: Rs 7 crore
- FY 2021-22: Rs 11 crore (Exceeds Rs 10 crore threshold)
Compliance Requirement: QPR Ltd must comply with e-invoicing from 1st October 2022, as its turnover in FY 2021-22 crossed the Rs 10 crore threshold.
WHO NEED NOT COMPLY WITH E-INVOICING?
Category |
Exemption Description |
|---|---|
Financial Institutions
|
Includes insurers, banking companies, financial institutions, and non-banking financial companies (NBFCs).
|
Goods Transport Agencies (GTAs)
|
Businesses providing road transportation services for goods are exempt.
|
Passenger Transport Service Providers
|
Exemption for businesses offering passenger transport services.
|
Multiplex Cinemas
|
Registered persons providing services through exhibition of films in multiplex screens are exempt.
|
Special Economic Zone (SEZ) Units
|
Businesses operating within SEZs are exempt (but SEZ developers are not).
|
SYSTEMS BEFORE AND AFTER E-INVOICING:
Before E-Invoicing:
- Businesses manually generated invoices and uploaded details in GSTR-1 returns.
- E-way bills were generated separately, often requiring manual data entry.
- Tax authorities manually verified returns and invoices.
After E-Invoicing:
- Invoices are electronically submitted to the IRP, which generates an Invoice Reference Number (IRN) and QR code.
- Invoice data is automatically integrated with the GST and e-way bill portals.
- E-way bills are generated automatically from e-invoice data, eliminating manual data entry.
TIME LIMIT TO GENERATE E-INVOICE:
- For Taxpayers with AATO above ₹5 crore: E-invoices must be generated before filing GSTR-1 for the respective tax period.
- Invoice Reporting: E-invoices should be reported on the IRP portal within 7 days of invoice issuance.
- Late Reporting: A late fee may apply if e-invoices are not reported within the stipulated time.
MANDATORY INFORMATION FOR E-INVOICING:
- Supplier Details: GSTIN, Name, and Address.
- Recipient Details: GSTIN, Name, and Address.
- Invoice Number: Unique and sequential.
- Invoice Date: The date the invoice is issued.
- HSN/SAC Code: For goods and services.
- Taxable Value: Total value of the goods or services.
- Tax Amount: GST amount applicable.
- Description of Goods/Services: Clear description for each item/service.
- IRN: Invoice Reference Number (generated by IRP).
- QR Code: Unique code generated by IRP for easy access
Cancellation Of E-Invoices:
- Time Limit: e-Invoices can be canceled within 24 hours from the time of generation.
- Process:
- Access the IRP portal.
- Provide the Invoice Reference Number (IRN) and Unique Document Identification Number (UDIN).
- Select the option to cancel the e-Invoice.
- After Cancellation: A Cancellation Acknowledgment with a new IRN is issued.
Filingin ensures a secure and smooth transition to the upgraded user interface while preserving your historical data. Our platform helps businesses maintain accurate and timely compliance with GST regulations, making the e-invoicing process easier and more efficient than ever.
Frequently Asked Questions in India
What is GST e-invoicing software?
GST e-invoicing software allows businesses to generate and authenticate e-invoices electronically through the GST portal. It automates the invoicing process, ensuring that businesses comply with the GST regulations by automatically transmitting the invoice details to the GST Network (GSTN) for validation.
Who needs to use GST e-invoicing software?
Businesses whose aggregate annual turnover exceeds the prescribed threshold (Rs. 5 Crore as of 1st August 2023) need to comply with e-invoicing for all B2B transactions. The applicability depends on your turnover and the nature of your transactions.
What documents need to be reported through GST e-invoicing software?
GST e-invoicing software is used to generate and report tax invoices, credit notes, and debit notes. These documents must be reported for all taxable B2B transactions, exports, deemed exports, and other relevant transactions as defined under GST law.
How does the GST e-invoicing process work?
Once an invoice is created, the software submits the invoice details to the GST Network’s Invoice Registration Portal (IRP). The IRP validates the invoice and generates a unique Invoice Reference Number (IRN), which is sent back to the software. The e-invoice is then stored for GST returns filing and can be used to generate e-way bills.
What are the key features of GST e-invoicing software?
Key features of the software include seamless API integration, bulk invoice generation, data validation checks, automatic e-way bill generation, real-time GST compliance, and easy integration with accounting software like Tally.
Can I integrate GST e-invoicing software with my existing accounting system?
Yes, most e-invoicing software can integrate seamlessly with popular accounting systems like Tally. This integration allows businesses to generate e-invoices directly from their accounting system without manually re-entering data.
Is there a limit to how many invoices I can generate with the software?
With GST e-invoicing software, businesses can generate thousands of invoices in minutes. Some solutions offer the capability to process up to 5,000 invoices per minute, ensuring that large enterprises can manage high volumes of invoices efficiently.
How do I handle errors or failed invoice generation?
The software typically includes error-checking mechanisms, and it can automatically retry failed e-way bill generation due to issues like incorrect data or connectivity problems, improving success rates.
Is my data safe when using GST e-invoicing software?
Yes, most GST e-invoicing software ensures that all your data is encrypted and securely stored. It complies with industry standards for data security to ensure the protection of sensitive business information.
How can GST e-invoicing software help in reconciliation and reporting?
GST e-invoicing software offers advanced reconciliation features that help compare and align your GSTR-1 data with e-way bill data. It also provides customizable reports, allowing businesses to easily track and manage their GST compliance.
