A Guide to E-invoice Generation under GST
- The GST Council approved the standard of e-invoice in its 37th meeting held on 20th September 2019.
- E-invoicing is proposed to be implemented from 1st January 2020.
- It will be implemented in a phased manner by GSTN.
- Similar to the new GST return filing system, the electronic invoicing system will first be available on a trial basis or voluntary compliance
Concept of E-invoicing:
- E-invoicing is a system in which B2B invoices are authenticated electronically by GSTN for further use on the common GST portal.
How does the system of E-Invoicing work?
Refer to the below step by step guide to understand how the system of E-Invoicing work under GST.
Step 1: JSON File Generation:
Taxpayers have to upload the invoice details in their accounting software (Tally, ERP, Busy, SAP etc.) and generate the JSON file.
Step 2: JSON File Upload:
Now this JSON file has to be uploaded onto the Invoice Registration Portal (IRP) to be managed by the GST Network.
Step 3: Invoice Validation:
IRP will validate the key details of the B2B invoice, checks for any duplication.
Step 4: E-Invoice Generation by IRP:
IF all the key details of the e-invoice are found appropriate, the Invoice Registration Portal will take following actions:
- Generates an Invoice Reference Number (IRN);
- Digitally signs the invoice;
- Creates a QR code in Output JSON for the supplier.
Step 5: E-Invoice Intimation:
After successful generation of e-invoice, the IRP intimates the relevant stakeholders. IRP sends the e-invoice data with digital signature and QR code to the following:
- Seller (on email id).
- Buyer (on email Id).
- GSTN Portal:
- In ANX-1 (for outward supplies) for the seller, and
- In ANX-2 (for inward supplies) for the buyer.
- E-way Bill System:
- For creating Part-A of e-way bill and only vehicle number have to be added in Part-B of the e-way bill.
Other Important Notes:
- Buyer has an option to accept or reject the transaction.
- GST system, further, will determine tax liability and input tax credit (ITC).
- The signing of e-invoice by seller is not mandatory.
- The invoices with an IRN Number will be considered as a valid tax invoice for GST purposes.
