Introduction

Indian companies' invoicing procedures have changed with e-invoicing. The GST system uses e-invoicing to increase transparency, decrease fraud, and simplify tax compliance. Integrating systems with government portals eliminates manual data entry. Understanding e-invoicing is essential for small and large businesses to avoid penalties and run smoothly.

This blog covers e-invoicing's applicability, login, and time constraints. We will also cover how to use the e-invoice site, who needs to use it, and how to handle cancellations. After reading this article, you'll know how to use e-invoicing for financial efficiency.

What Is E-Invoice?

E-invoicing uses a government-regulated mechanism to create and validate electronic invoices. A government e-invoice site certifies and verifies the invoices created by accounting software. Each invoice has an IRN and QR code that businesses must print or share with consumers.

E-invoicing aims to standardize, decrease mistakes, and avoid tax fraud by tracking invoices in real time. E-invoicing follows GST-compliant guidelines, unlike traditional invoicing.

E-invoicing eliminates paperwork, increases accuracy, and decreases human mistakes by automating operations. The GST platform auto-populates invoice data, saving businesses time and effort in GST return submissions.

Also Read : why is roc filing needed

What is the GST E-Invoice?

Under the GST e-invoice system, companies create invoices in a consistent style and have them verified by a government e-invoice site. We check every invoice to ensure it adheres to GST compliance rules. Validation results in the portal assigning the invoice an IRN and QR code, making it legally legitimate.

This method covers companies whose turnover surpasses the GST council's recommended limit. After that, the e-way bill system and the GST return forms (GSTR-1) automatically populate the invoice data, thereby eliminating the need for manual data entry. Important aspects of the GST e-invoice system consist in:

• Standardization: This means that all invoices will be in a uniform format for reducing differences.
  
  
• Automation: The GST and e-way bill systems are auto-linked so invoice details are shared automatically.
  
  
• Transparency: It involves reducing fraud and monitoring transactions in real time.
  
  
• Ease of Compliance: The system pre-populates the invoice details during the GST return filing process.
  
  
• Reduction in Errors: Automated processes provide a minimum of manual errors in invoicing.

The E-Invoice Applicability

Some businesses have to e-invoice based on their annual turnover. The threshold at which the program was first rolled out for businesses with a turnover of over ₹500 crores has been progressively lowered to businesses with turnovers of more than ₹10 crores.

Applicability:

• Revenue-Based Threshold: Companies whose yearly revenue is ₹10 crores or more have to start e-invoicing. Future reduction in this barrier might be possible.
  
  
• Exemptions: E-invoicing rules exclude several industries, including financial institutions, insurance firms, commodities, and services free from GST.
  
  
• Cross-border Transactions: When their turnover fulfills e-invoicing requirements, companies handling cross-border suppliers also have to follow these rules.

Also Read : Gstr 9 annual return

Limit on 2024 E-Invoice Turnover

The Limit:

Businesses under ₹5 crore will face a strict e-invoicing limit in 2024. This applies to aggregate turnover from any financial year before 2017-18.

Applicability:

B2B e-invoices are required for businesses beyond this threshold. Not all B2C transactions require e-invoices.

Why Should We Value It?

E-invoicing seeks to lower tax avoidance, guarantee accurate reporting, and simplify the GST return filing procedure. Non-compliance can result in fines or the rejection of invoices, which can disrupt company processes.

Benefits:

• Real-Time Validation: Ensures accuracy in reporting invoices.
  
  
• Data Integration: Simplifies GST return filing and e-way bill generation.
  
  
• Fraud Prevention: Real-time tracking minimizes fraudulent activities.
  
  
• Operational Efficiency: Reduces manual work and increases efficiency.

What Is E-Invoice Portal?

The e-invoice portal generates government-approved invoices, and users can use the platform to generate, validate, and authenticate them. On the other hand, it serves as the core system for all e-invoicing work, such as the creation of IRNs and QR codes. NIC and private portals integrated into the GST system are popular e-invoice portals.

Key Functions:

• Uploading invoice data for validation.
• Generating IRNs and QR codes.
• Auto-populating GST return forms.
• Simplifying e-way bill generation.

Also Read : Section 194q of the income tax act applicability tds rate turnover limit and examples

What Is E-Invoice Login?

"E-invoice login" refers to e-invoicing via a portal. Businesses must register to create and validate invoices. Login credentials usually match the company's GSTIN.

The Benefits of It:

The e-invoice login is the starting point for uploading invoices, computing IRNs, and handling cancels. Businesses cannot follow GST e-invoicing criteria without appropriate login credentials.

The features of the Login Process include real-time invoice status monitoring, secure access to the e-invoice site, and the simplification of data management for GST returns.

E-invoicing under GST is a government-regulated process that standardizes invoice generation for businesses, ensuring compliance with GST laws. It automates validation via a central portal, assigns unique Invoice Reference Numbers (IRN), and integrates seamlessly with GST and e-way bill systems. This reduces errors, prevents tax fraud, and simplifies return filing, making e-invoicing a crucial tool for businesses with turnovers exceeding ₹10 crores. Stay compliant, save time, and boost efficiency with e-invoicing in GST.

Step-by-Step Process for Login

Visit the E-Invoice Portal:

• Go to the official e-invoice portal (e.g., einvoice1.gst.gov.in).

Registration:

• Click on "Registration" and enter your GSTIN.
• Validate your GSTIN details and provide the necessary information.

Generate Login Credentials:

• Establish a username and password for your account.
• Submit your details and log in using the generated credentials.

Upload Invoice Data:

• You can then create invoices in the normal format using your accounting software.
• Upload the invoice JSON file to the e-Invoice portal.

Generate IRN and QR Code:

• The portal validates the invoice data and generates an IRN and QR code.

Download and Print Invoice:

• Download the validated invoice and include the IRN/QR code before sharing it with customers.

Also Read : Types of gst in india igst sgst cgst and utgst

Who Is Mandatory for an E-Invoice?

Companies who satisfy particular turnover requirements defined by the GST Council must be e-invoiced. Originally set for companies whose turnover exceeded ₹500 crores, the cutoff has been progressively lowered to allow companies whose turnover is at least ₹10 crores.

Key Highlights:

• Turnover Criteria: Based on the notice, enterprises with an overall turnover of ₹10 crores or higher for any year from 2017-18 to now are covered.
• Reiterability: B2B (business to business) exports as well as for supply under reverse charge systems call for e-invoicing.

Exemptions:

• Financial institutions such as banks and insurance companies.
• SEZ (Special Economic Zone) units.
• Goods and services exempt from GST.

Who Is Eligible for E-Invoice?

The business's turnover and the nature of its transactions primarily determine its eligibility for e-invoicing. Businesses generating taxable supplies, exports, and reverse charge supplies are required to comply.

Eligibility Criteria:

• Turnover-Based Requirement: Businesses with an annual turnover of ₹10 crores or more in any financial year since 2017-18 are eligible.

Exemptions:

• Government departments and local authorities.
• Non-GST-registered entities and specific exempt categories.

Also Read : Gst tax invoice format for your busines

E-Invoice 1

E-Invoice 1 refers to the first version of the standardized e-invoice format introduced under the GST system. Businesses designed it to ensure consistency and compatibility across various accounting and billing software.

Features of E-Invoice 1:

• Standardized Format: E-Invoice 1 uses a predefined schema that includes mandatory and optional fields. This ensures uniformity across businesses.
• Integration: It seamlessly integrates with GST and e-way bill portals, and eases the duplication of repetitive data.
• Automation: The portal then validates the invoice, creating an Invoice Reference Number (IRN) and QR code after upload.

Is There a Time Limit for Invoicing?

Yes; under GST, there is a time limit for generating e-invoices. Businesses must generate and upload invoices to the e-invoice portal within seven days of the transaction date.

Why the Time Limit Matters:

• Ensures real-time compliance with GST regulations.
• It minimizes discrepancies between invoice dates and GST filings.
• It assists businesses in avoiding penalties and maintaining smooth operations.

Consequences of Missing the Deadline:

• GST may penalize or reject an e-invoice for being late.
• It might also interrupt shipping and e-way bill creation.

How to Cancel E-Invoice in Tally Prime

Steps to Cancel an E-Invoice in Tally Prime:

• Access the E-Invoice Module: Open Tally Prime and navigate to the e-invoice management section.
• Select the Invoice: Choose the invoice you wish to cancel from the list of uploaded invoices.
• Initiate Cancellation: Click on the “Cancel” option. Provide a valid reason for cancellation, such as incorrect details or duplicate entry.
• Confirm Cancellation: Confirm the cancellation request. The system will update the status on the e-invoice portal.

E-Invoice Distance

The concept of e-invoice distance comes into play when generating e-way bills. The distance parameter guarantees the transportation of goods over the specified distance mentioned in the invoice.

Why It’s Important:

• Accurate distance reporting is crucial for compliance with GST and transportation regulations.
• It minimizes discrepancies during inspections and audits.

How It Works:

• When generating an e-way bill, the system cross-verifies the distance with the delivery location mentioned in the invoice.
• Any mismatch may lead to penalties or delays during transit.

What is the 7-Day Time Limit for an E-Invoice?

The e-invoice portal requires GST-compliant firms to upload and validate invoices within seven days of the invoice date. This deadline ensures real-time compliance and transparency.

Impact of the 7-Day Rule:

• Timely Compliance: It guarantees the prompt validation and recording of invoices.
• Reduced Errors: This approach minimizes discrepancies between invoice and GST return data.
• Improved Cash Flow: Faster invoice processing helps businesses manage payments efficiently.

Consequences of Missing the Time Frame:

• Failing to comply with the 7-day time limit can result in penalties.
• Delayed e-way bill generation and potential disruptions in the supply chain.

Is There a Way to Cancel an Invoice?

Businesses can cancel e-invoices within 24 hours after creation. You can cancel other bills using their e-invoice site.

Invoice Cancellation Steps:

• Log on using your e-invoice portal credentials.
• Select “Cancel Invoice”.
• Choose the invoice to cancel.
• Provide a valid reason for cancellation and validate the request.

Also Read : How to file nil gst return

What if an E-Invoice Was Not Generated Within 3 Days?

Businesses must sometimes create an e-invoice within three days to avoid compliance and logistics issues.

The Effects of E-Invoicing Delays:

• Non-Compliance Penalties: Delayed invoicing can lead to significant fines by GST authorities.
• Disruption in Operations: Goods transportation is delayed if an e-way bill cannot be generated without a valid e-invoice.
• Legal Complications: Failure to comply may result in an inquiry from tax authorities.

FAQ

• Do I need an e-invoice for ₹5 crore?
  Such companies having turnover of ₹10 crores or more must mandatorily do e-invoicing in 2024.
  
  
• How much is the 2024 turnover limit for e-invoices?
  Turnover ceiling of ₹10 crores or greater is for e-invoicing in 2024.
  
  
• How is e-invoice now being used?
  E-invoicing can be used by businesses having a turnover of ₹10 crores or more for B2B transactions, exports, and reverse charge supply.
  
  
• What is the GST limit of ₹5 crore?
  The GST ceiling of ₹5 crore applies to the QRMP program, not e-invoicing.
  
  
• Is it possible to generate an e-invoice after the invoice date?
  You must create it within 7 days of the invoice date.
  
  
• Can I cancel an e-invoice in Tally Prime?
  In the e-invoice module, pick the invoice, click "Cancel," explain, and confirm.
  
  
• How to cancel an e-invoice?
  Access the e-invoice site, choose the invoice, give a cancellation reason, and confirm within 24 hours.
  
  
• How to cancel an e-way bill in Tally Prime?
  Open the e-way bill module, select the bill, choose "Cancel," provide a reason, and confirm.
  
  
• Can we edit the e-invoice in Tally Prime?
  No, e-invoices cannot be edited once generated. Only cancellation is allowed within 24 hours.
  
  
• Can we cancel the e-invoice?
  Yes, you can cancel an e-invoice within 24 hours of its creation.
  
  
• What is the process for canceling an electronic invoice in Tally?
  In Tally's e-invoice section, pick the invoice, click "Cancel," explain, and confirm.
  
  
• How can the e-way bill be canceled on the e-invoice?
  Select the bill, click "Cancel," and offer a reason within 24 hours on the e-way bill site.
  
  
• Can I cancel an e-invoice after 24 hours?
  Cancellation after 24 hours is prohibited. Inform the tax officer to resolve it.
  
  
• What is the GST invoice cancellation time limit?
  Generated GST invoices must be canceled within 24 hours.
  
  
• Can you revive a canceled invoice?
  E-invoices cannot be revived after cancellation. Generate a new invoice.