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E-Invoice Under GST
E-invoicing under the Goods and Services Tax (GST) regime is a significant step towards digitizing the invoicing process in India. It mandates the electronic authentication of B2B invoices through the Invoice Registration Portal (IRP), ensuring transparency and reducing tax evasion.
What Is E-Invoice under GST?
Electronic invoicing (“e-invoicing”) under India’s GST is a system where certain business-to-business (B2B), business-to-government (B2G), and export invoices must be reported digitally to the Invoice Registration Portal (IRP) before being shared with the buyer. Unlike traditional invoices, e-invoices carry a unique Invoice Reference Number (IRN) and a digital signature generated by the IRP, ensuring authenticity and tamper-proofing.
Why Was E-Invoicing Introduced?
- Prevent Tax Evasion: By forcing businesses in scope to register invoices in real-time, the government can track transactions and reduce fraudulent claims.
- Improve Data Accuracy: Automated digitization cuts down on manual errors in invoice data, leading to more accurate GST returns.
- Seamless ITC Matching: E-invoices feed directly into the buyer’s GSTR-2B, streamlining input tax credit reconciliation.
Who Needs to Generate E-Invoices?
- ₹500 crore and above: Required since October 2020.
- ₹100 crore and above: From January 2021.
- ₹50 crore and above: From April 2021.
- ₹20 crore and above: From October 2023.
- ₹5 crore and above: From August 2023.
E-invoicing applies only to B2B, B2G, and export transactions; B2C invoices remain out of scope.
How Does the E-Invoicing Process Work?
- Prepare Invoice: The supplier creates the invoice in their billing software in the prescribed JSON schema.
- Submit to IRP: The software pushes this JSON to the Invoice Registration Portal.
- Generate IRN & QR Code: The IRP verifies, signs, and returns the invoice with a unique IRN and QR code.
- Share Documents: The supplier/PDF with IRN is sent to the buyer. Simultaneously, the e-invoice data flows to GST returns, e-way bill, and e-invoicing archives.
Steps to Generate an E-Invoice
- Invoice Preparation: Generate the invoice using your accounting or billing software, ensuring it aligns with the e-invoice schema.
- JSON File Creation: Convert the invoice into a JSON file format as per the prescribed schema.
- Upload to IRP: Submit the JSON file to the IRP via API integration or through the e-invoice portal.
- IRN Generation: The IRP validates the details, generates a unique IRN, and returns the digitally signed e-invoice with a QR code.
- Invoice Issuance: Share the e-invoice with the recipient, ensuring the IRN and QR code are included.
For detailed steps and tools, businesses can refer to the official e-invoice portal.
Benefits of E-Invoicing
- Real-Time Reporting: Instant visibility for tax authorities helps curb evasion.
- Automated Compliance: Seamless populating of GSTR-1 and e-way bills reduces manual work.
- Enhanced Data Security: Digital signatures and IRN prevent tampering and duplication.
- Standardized Format: A uniform structure simplifies integration across ERP and accounting systems.
Key Things to Remember
- Archival Requirement: E-invoices must be securely stored for eight years.
- Offline Tools: Small taxpayers can use the offline tool on the GST portal to generate IRN manually.
- Continuous Updates: The government periodically issues notifications to refine schema, exemption lists, and technical guidelines.
E-Invoice Login and Status Check
- Login: Access the e-invoice portal using your GSTIN credentials.
- Enablement Status: To check if your business is enabled for e-invoicing, visit the E-Invoice Enablement Status page and enter your GSTIN.
Time Limit for Reporting E-Invoices
From 1st November 2023, businesses with an AATO of ₹100 crore or more must report invoices to the IRP within 30 days from the invoice date. This time limit will extend to businesses with an AATO of ₹10 crore or more from 1st April 2025.
FAQ
What is an e-invoice under GST?
An e-invoice is a GST invoice registered on the IRP, carrying an IRN and QR code that authenticate the document.
Who must generate e-invoices?
Taxpayers with turnover above the notified thresholds (currently ₹5 crore for B2B/B2G/export transactions).
Does e-invoicing apply to B2C sales?
No. E-invoicing is mandatory only for B2B, B2G, and export invoices.
How do I get the IRN?
Submit your invoice JSON to the IRP. The portal validates, signs, and returns the IRN and QR code.
Can I use offline tools?
Yes, an offline JSON generator tool is available for small taxpayers through the GST portal.
Are e-invoices tamper-proof?
Yes. Digital signatures and IRN make e-invoices uniquely identifiable and unalterable.
How long must I store e-invoices?
You must archive e-invoices for eight years, as per IRP guidelines.
Does e-invoicing integrate with GSTR-1?
Yes. E-invoice data auto-populates in GSTR-1 and aids in seamless return filing.
What if IRP is down?
Taxpayers can continue using e-way bills and report e-invoices once the portal is back up; safeguards exist for IRP downtime.
Will the threshold change?
The government may revise thresholds via notifications—stay updated on the GST portal and official gazettes.
What is the current e-invoicing turnover limit?
As of 1st August 2023, e-invoicing is mandatory for businesses with an annual turnover exceeding ₹5 crore.
How can I check my e-invoice enablement status?
Visit the E-Invoice Enablement Status page and enter your GSTIN to check your status.
Is there a time limit to generate e-invoices?
Yes. From 1st November 2023, businesses with an AATO of ₹100 crore or more must generate e-invoices within 30 days of the invoice date. This will apply to businesses with an AATO of ₹10 crore or more from 1st April 2025.
Can I voluntarily adopt e-invoicing if my turnover is below the threshold?
Yes. Businesses below the mandatory threshold can opt for e-invoicing to streamline their invoicing processes.
What happens if I don't generate an e-invoice when required?
Failure to generate a mandated e-invoice can lead to penalties under GST law and the invoice may be considered invalid.