One of the most discussed terms of the year 2020 has been GST. Since 2020 people have been trying to find out the changes that GST carries with itself along with the benefits. It has been a constant talk of the industry. Some terms often confuse the taxpayers. Such two similar terms are an invoice and e-invoice.
So, here we are about to point out the major differences between invoicing and e-invoicing.
What is invoicing?
An invoice is a commercial document to record the information of sale and purchase between buyer and seller.
Distinguishing e-invoicing from invoicing
- Under invoicing, every taxpayer can be the applicant, but in e-invoicing, only those taxpayers making B2B supplies or making a turnover of more than 50 crores are required to generate e-invoicing until now. This may increase as the government launches its further steps.
- In e-invoicing, the valid e-invoice is sent directly to the email of the applicant but in invoicing no such facility is available for the GST portal.
- Under invoicing invoice number is given to the applicant but in e-invoicing, a reference number is generated by an algorithm. The sole purpose of this is to store e-invoice at the central registry for future reference.
- In the invoice, only the supplier’s digital signature was required and there is no facility available for digital signing of uploaded invoice but in e-invoice validated invoice is digitally signed by the invoice registration portal.
- Verifying the invoice: Verification of invoice cannot be done by using QR code, but in e-invoicing, QR code is included. This QR code is generated by the invoice registration portal. It enables verification of e-invoice even in the absence of the Internet and it is compulsory to have a QR code in B2B transactions.
- Digitalising the system: Invoicing includesa higher risk of mistake as it includes more human involvement, but in the case of e-invoicing once the invoice detail is filled and verified by the Invoice Registration Portal, the GSRT 1 of the seller is updated and e-billing details are also filled.
- Time duration: e-Invoicing is available only for 24 hours on IRP and can be cancelled during this time. Here the amendment can be made according to the GST laws,under-invoicing amendment can be made on the GST portal but only according to GST laws.
- Introducing the application software: Invoicing details can be seen on the GST portal, but in e-invoicing, necessary details can be made available on the app by using a QR code. A copy of the e-invoice is also sent to the supplier by email so that supplier can also save a copy under the invoice system.
- Increment in the security of data: Verification of genuineness of invoice is not easy, but verification of e-invoicing can easily check by scanning QR code.
- Searching simplified: Invoicing has a higher possibility of search as it includes less digitalization but in e-invoicing, all the invoice detail is shared with the GST department at the transaction level, so e-invoicing includes less possibility of search.
Read more about E-Invoicing under GST
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