In its 35th meeting, the GST council decided on a system of invoicing i.e., e-invoicing. This system of e-invoicing applies to few specific domains of people.

What is e-invoicing under GST?

To understand this better we need to know what is e-invoicing under GST?

Just like the e-way bill system, electronic invoicing under GST was introduced in the GST system on 1st October 2020. In this authentication billing process, all the bills are registered with the government on the invoice registration portal and thereby verified by generating a unique invoice reference number (IRN). The invoice that has completed the above-stated process and has acquired a unique IRN is considered genuine.

E-invoicing under GST- a brief intro

Why is e-invoicing introduced?

The generation of fake invoices has always been a cause of concern for the government. To curb this crisis and prevent tax leakage, the government introduced this step in a very organized and planned manner. The government wanted to bring about a change in the overall core business process of the current scenario. This demanding scheme would now push the business world to re-assess their technology field.

Further, a question strikes the mind: Who is eligible for the e-invoice in the GST system?

The government of India has launched electronic invoicing in steps through a much planned scheme. These steps are as described below:

  • The first step, applicable since 1st October 2020 covers taxpayers who have a turnover exceeding 500 crores.
  • The second step involved all the taxpayers with an aggregate turnover of more than 100 crores and was implemented on 1st January 2021.
  • The third step involves the taxpayers with an aggregated turnover between 50-100 crores, which was implemented and made active on 16thMarch 2021.
  • Further steps will be soon dropped down by the government.

However, there are businesses and people where this system is not implemented. This category was clearly stated in CBIC Notification No. 13/2020- Central Tax.

  • A goods transport agency
  • A registered person supplying passenger transportation service
  • An SEZ unit
  • Any Financial institution involving banks, insurers, and NBFC.
  • Any registered person providing services by way of admission to the exhibition of cinematographicfilms in multiplex services.

What are the benefits of e-invoicing under the current business scenario?

  • The faster updating of invoices
  • Faster availability of ITC
  • The real-time tracking of invoices
  • The faster filing of invoice return
  • The integration of multiple software-generated invoices.
  • The reduction in the number of mismatches.

For any further assistance for GST Return filing connect with our team.

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