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Transporting goods from one place to another requires the filing of e-way bills on the GST portal. Similarly, recently the GST council decided to implement the e-invoicing system. It shall be applicable to a particular category of people. E-invoicing doesn’t mean the generation of invoice on GST portal, but it implies submission of an already generated standard on a common e-invoice portal. Let’s now have a better understanding of e-invoicing under GST.
Table of Contents
E-invoicing is a system where B2B invoices are authenticated electronically by GST Network for further use on the common GST portal. Under the e-invoicing system, an identification number is issued against every invoice by the Invoice Registration Portal, which is managed by the GST Network.
The first Invoice Registration Portal was launched by the National Informatics Centre. The invoice information is transferred from the portal to the GST portal and e-way bill portal. Hence, there is no need to enter manual data while filing GSTR-1 return and generation of part A of the e-way bills because the information is directly passed by the Invoice Registration Portal to the GST portal.
E-invoicing is applicable to businesses whose aggregate turnover has gone beyond 500 crore rupees limit in any of the preceding financial year from 2017-18 to 19-20.
Moreover, from January 1, 2021, e-invoicing shall apply to businesses whose turnover has exceeded 100 crore rupees limit in any of the financial years 2017-18 to 19-20.
However, regardless of the turnover, e-invoicing will not be applicable to the below-mentioned category of persons:
Businesses can benefit in the following ways:
E-invoicing can help in curbing tax evasion in the following ways:
The following procedure can be followed for raising or generating an e-invoice:
It is worth mentioning that the taxpayer can continue to print his invoice as being done now. The e-invoicing system just mandates taxpayers to report invoices on Invoice Registration Portal in electronic format.
There are certain myths doing the round about e-invoicing. In this segment, we have looked to bust these myths.
Myth-1
E-invoice should be generated through the GST portal[1].
Fact
The tax invoice shall continue to be generated through the existing ERP system. It has to be registered on IRP.
Myth-2
E-invoicing applies to all.
As stated at the beginning of this article, e-invoicing is applicable to businesses whose aggregate turnover has went beyond 500 crore rupees limit in any of the preceding financial year from 2017-18 to 19-20. Those above 100 crore rupees should follow from January 1, 2021.
Myth-3
New software is required for e-invoicing under GST.
No new software is needed. Existing software can be geared up to implement additional e-invoicing features.
According to Cygnet GST Suvidha Provider, one of the GST Suvidha Provider, e-invoicing is expected to provide better services to taxpayers by restraining multiple reporting and simplifying the filing of new returns. As e-invoicing under GST is going to become mandatory for all businesses from 1st April 2021, it won’t be a bad idea to start preparing in advance for the change.
Read our article: Power of Inspection, Search, and Seizure under GST
Ashish M. Shaji has done his graduation in law (BA. LLB) from CCS University. He has keen interests in doing extensive research and writing on legal subjects especially on corporate law. He is a creative thinker and has a great interest in exploring legal subjects.
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