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e-Invoicing is mandatory for businesses, having a turnover of 10 crores. It is a challenging task, which can have consequences like hefty penalties if not managed well. At Newage, we believe in a customer-first approach and have created a knowledge series for freight forwarders to get to know more about e-invoicing and get their businesses compliant with the Government’s mandatory regulations. Hope you find this knowledge series on e-invoicing informative and useful. India e-Invoice: What you need to know
Although e-invoicing is not new, its relevance has grown manifold in recent times. The pandemic was the catalyst in encouraging freight forwarders to embrace digitalization overnight and adopt touchless technologies like e-Invoicing.
What is e-Invoicing?
Electronic invoicing (e-Invoicing) is the system in which all B2B invoices are electronically uploaded and authenticated by the 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 (GSTN).
In simple words, e-invoice is the invoice document exchange between a seller and a customer in an integrated electronic format. It fully automates the process of invoice capture with data being decoded by the buyer’s AP system regardless of the invoice format. Both stakeholders can manage invoicing data on a central cloud-based platform.
Today, e-invoice is not an option because, from 1st October 2022, the government of India made it mandatory for businesses with a total annual turnover of more than Rs. 10 Crore in any previous financial year from 2017–18 to 2021–22.
Benefits of e-Invoicing Streamlined & efficient processes to reduce the turnaround time
e-Invoicing helps organizations streamline their invoice processing cycles, reducing manual work, approving, tracking, and chasing invoices and human errors. Implementing it ultimately results in better efficiency and faster turnaround time.
Better visibility
Electronic invoicing enhances visibility into invoices, purchase orders, supporting documentation, and contracts. It tracks invoices and offers detailed audit trails.
Reduced risk
Greater visibility into invoices leads to a reduced risk of invoice fraud, human error, duplication, oversight, etc. Organizations can save countless hours with e-invoicing.
Transparency in tracking expenditure and savings
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e-Invoicing enables efficient tracking of money spent and saved. This can help you identify opportunities to save more and make an informed decision.
Improved accuracy
Improved visibility and end-to-end tracking offer increased accuracy. You can also track invoice validation, approvals, and payment in real-time. This considerably reduces errors and eliminates overpayments and duplicate payments.
Eco-friendly initiative
By switching to e-Invoicing, you can eliminate the need for paper-based invoices. This reduces the wastage and costs associated with paper-based processes used within your supply chain processes.
In conclusion:
e-Invoicing has become one of the most strategic steps companies are taking toward the digitization of processing cycles. With the government, introducing mandates, it is the right time to do e-invoicing for your business.
Save your time and effort by reporting your e-invoice to Invoice Registration Portal through eFreight Suite and obtain IRN instantly. eFreight Suite is integrated with IRIS, Cleartax, Webtel, FYNAMICS or any other ASP that Forwarder subscribes for e-invoicing through API.
eFreight Suite simplifies the freight operation without human interface with its advanced features like auto Audit Reports & auto alert e-invoicing system for due payment which saves time and improves productivity.
Summary
GST was implemented on 01 Jul 2017 by the Government of India as part of major indirect tax restructuring to implement the One Nation One Tax Policy. The GST Act aimed to make India a unified economic market with common tax rates and procedures across the country by subsuming a multi-level tax structure preceding it.
GST is a digitalization driven to bring transparency and ease of doing business. The e-returns filing, e-way bills & e-invoicing to name a few.
e-Invoicing was introduced to automate the tax filing process for taxpayers. The Government made it mandatory based on the turnover. Initially, it was introduced on 01st Oct 2020 for businesses with a turnover of Rs 100 crores. Later, from 1st Apr 2021 for businesses with a turnover of more than Rs. 50 crore and then again extended to turnover with Rs 20 crores from 01 Apr 22. Now, the same has been extended to businesses with a turnover of Rs 10 crore from 01 -Oct-22. Government is likely to extend the e-invoicing to Rs 5 crore from 01 Jan 23 and later may extend up to Rs 1 crore turnover businesses in the next fiscal year.
The e-Invoice System is for GST-registered persons for uploading all the B2B invoices to the Invoice Registration Portal (IRP). The IRP generates and returns a unique Invoice Reference Number (IRN), digitally signed e-invoice, and QR code to the user.
With its advanced features, eFreight Suite simplifies freight operations without the need for human interference. Once an invoice gets posted in eFS, the IRN is generated automatically. The invoice is automatically emailed to the customer. Scheduled periodic outstanding statements are emailed to customers on a periodic basis. Digital Signature is mandatory as part of IRN generation. In eFS, a Digital signature (PFX format) is integrated in all e-invoices.
Originally published at https://www.newage-global.com on November 3, 2022.
