Myths on E-invoicing under GST

E-Invoice Under GST

E-invoicing’ or ‘electronic invoicing’ is a system in which B2B invoices are authenticated electronically by GSTN for further use on the common GST portal. Under the electronic invoicing system, an identification number will be issued against every invoice by the Invoice Registration Portal (IRP) to be managed by the GST Network. All invoice information will be transferred from this portal to both the GST portal and e-way bill portal in real-time.
Therefore, it will eliminate the need for manual data entry while filing ANX-1/GST returns as well as generation of part-A of the e-way bills, as the information is passed directly by the IRP to GST portal.

People have some myths regarding E-invoicing, here's some myths and reality of e-invoicing under GST.
  • Myth No 1:- I would need to issue invoices through GST portal.
  • Reality:- No, you would continue to issue invoices the way you have been doing it. You are just required to generate the Invoice Reference Number (IRN) for each invoice issued through your billing software, tally, ERP or accounting software.
  • Myth No 2:- The generation of IRN might take several minutes and that would affect my business.
  • Reality:- The Invoice Registration Portal (IRP) would assign the IRN in sub 100 milliseconds. More than one IRP's will be made operational.
  • Myth No 3:- E-invoice would need to be issued for all the transactions
  • Reality:- Issuance of e-invoice is mandatory only for B2B transactions and export at this stage.
  • Myth No 4:- If I am not using a billing software, ERP or accounting software, I can't issue e-invoice.
  • Reality:- 8 free billing & accounting software have been provided free of cost by GSTN for taxpayers having turnover up to 1.5 crore. These can be used for issuing e-invoices.
  • Myth No 5:- E-invoicing will add one more GST compliance.
  • Reality:- On the contrary E-invoice and its reporting will reduce compliance. Reporting to GST will lead to auto creation of ANX-1 and ANX-2 as well as E-way Bill if asked. (Read about E-way bill in detail, E-Way Bill, Simplified )
  • Myth No 6:- The IRN generated by the IRP would be the Invoice number.
  • Reality:- No, it would just be a reference number. The invoice number will be the one that you have entered in the invoice.
  • Myth No 7:- I would be required to make major changes in the billing software, ERP or accounting software to become e-invoice compliant.
  • Reality:- No major change would be required at your end. However, the software providers would require to introduce small changes at the backend. 
  • Myth No 8:- There will be separate invoice formats for different businesses.
  • Reality:- Invoice format will be same for all the categories of taxpayers. Invoice schema released by GSTIN has mandatory and optional fields that needs to be filled depending upon the nature of business.

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[Disclaimer:-This article is being furnished for informational purposes only. We make every effort to use reliable & comprehensive information, but we do not represent that the contents of the article are accurate or complete.]

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