Contents
E-invoicing: .................................................................................................................................2
Current system in place for issuing invoices .........................................................................2
Electronic invoicing benefit businesses .................................................................................3
GSTN’s e-invoicing initiative ....................................................................................................4
Dates E-invoicing getting implemented ..................................................................................5
Process of getting an e-invoice................................................................................................6
E-invoicing curb tax evasion Measures: .................................................................................7
What are the mandatory fields of an e-invoice?.....................................................................7
E-invoices Format .................................................................................................................... 12
E-invoicing:
‘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 proposed 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.
Current system in place for issuing
invoices
Currently, businesses generate invoices through various software’s, and the details of
these invoices are manually uploaded in the GSTR-1 return. The invoice information is
thereafter reflected in GSTR-2A for the recipients for viewing only. On the other hand,
the consignor or transporters must generate e-way bill by again importing the invoices in
excel or JSON manually.
Under the new return system, an annexure in form GST ANX-1 will mostly take the
place of the GSTR-1 return. However, the process of generating and uploading invoice
details will remain the same. It will be done by importing using the excel tool/JSON or by
the online entry of data. A seamless flow of data is expected for e-way bill generation. e-
invoicing will be the key tool to enable this.
Electronic invoicing benefit businesses
Businesses will have the following benefits by using e-invoice initiated by GSTN:
1. E-invoice resolves and plugs a major gap in data reconciliation under
GST to reduce mismatch errors.
2. E-invoices created on one software can be read by another, allowing
interoperability and help reduce data entry errors.
3. Real-time tracking of invoices prepared by the supplier is enabled by e-
invoice.
4. Backward integration and automation of the tax return filing process – the
relevant details of the invoices would be auto-populated in the various
returns, especially for generating the part-A of e-way bills.
5. Faster availability of genuine input tax credit.
6. Lesser possibility of audits/surveys by the tax authorities since the
information they require is available at a transaction level.
GSTN’s e-invoicing initiative
GSTN had released the draft version of e-invoice format in an excel template and made
it available for public feedback around 20 August 2019. The same was approved by the
GST Council with some alterations at the 37th GST Council meeting held on 20
September 2019. GSTN associated with ICAI drafted the format to be compliant with
the GST and other Indian tax laws. Apart from these, the format adheres to international
and various industry standards. The e-invoice format looks exhaustive and a single
format caters to different industries and businesses.
Any existing accounting or invoicing software/ application provider (SAP/Tally/Busy)
must follow the PEPPOL standard for invoice generation. Taxpayers will, therefore, be
able to generate a compliant invoice at the source. GSTN referred the PEPPOL (Pan
European Public Procurement Online) standard, which works on Univeral Business
Language (UBL) version of electronic XML. Currently, PEPPOL is the most used
standard across the globe. The system advocates diversified business applications and
trading communities to exchange information along their supply chains using a common
or a standard format. It enables a single point of data entry into electronic commerce for
businesses. Thereafter, the data flows across different portals with the help of an IRP.
The GSTN’s e-invoice will contain the following parts:
(1) E-invoice schema: It consists of the technical field name, description of each field,
whether it is mandatory or not, and has a few sample values along with explanatory
notes.
(2) Masters: Masters will specify the set of inputs for certain fields, that are pre-defined
by GSTN itself. It includes fields like UQC, State Code, invoice type, supply type, etc.
(3) E-invoice template: The template is as per the GST rules and enables the reader to
correlate the terms used in other sheets. The mandatory fields are marked in green and
optional fields are marked in yellow.
Dates E-invoicing getting implemented
While no exact date has been provided yet, electronic invoicing is proposed to be
implemented from 1st January 2020. It will be implemented in a phased manner by
GSTN. Similar to the new GST return filing system, the electronic invoicing system will
first be available on a trial basis or voluntary compliance.
Process of getting an e-invoice
The following are the stages involved in generating or raising an e-invoice.
1: Taxpayer must ensure to use the reconfigured ERP system as per PEPPOL
standard. He must coordinate with the software service provider to incorporate the
standard set for e-invoicing, i.e. e-invoice schema (standards)
and must have the mandatory parameters, at least. It should be capable of generating
the JSON file for multiple invoices together. Those taxpayers not having any software
will be provided offline utility. Also, small taxpayers having annual turnover below Rs 1.5
crore have the option to choose from 8 different accounting and billing software’s all tied
up with the GSTN. It is available free of cost. It is available both as online (cloud-based)
as well as offline (installed on the computer system of the user).
2: The taxpayer must thereafter raise a normal invoice on that software. He must give
all the necessary details like, billing name and address, GSTN of the supplier,
transaction value, Item rate, GST rate applicable, tax amount, etc.
3: Upload the details of invoice especially mandatory fields onto the IRP using the
JSON file only. It can be done directly or GSPs or through APIs(apps or software
providers). The IRP will act as the central registrar for e-invoicing and its authentication.
There are several modes of interacting with IRP such as web-based, API-based, SMS
based, mobile app-based, an offline tool-based, and GSP based.
4: IRP will validate the key details of the B2B invoice, checks for any duplications and
generates an invoice reference number (hash) for reference. The hash could have been
generated by the taxpayer beforehand itself (Format of IRN or hash: Seller GSTIN,
Invoice number, and FY in YYYY-YY). But then, it becomes valid and effective only
once registered on IRP.
5: IRP generates the invoice reference number (IRN), digitally signs the invoice and
creates a QR code in Output JSON for the supplier. On the other hand, the recipient of
the supply will also get intimated of the e-invoice generation through email (if provided
in the invoice).
6: IRP will send the authenticated payload to GST portal for GST returns. Additionally,
details will be forwarded to the e-way bill portal, if applicable. ANX-1 of seller and ANX-2
of the buyer gets auto-filled for the relevant tax period. In turn, it determines the tax
liability.
A taxpayer can continue to print his invoice as being done presently with logo. e-
invoicing system only mandates all taxpayers to report invoices on IRP in electronic
format.
E-invoicing curb tax evasion Measures:
It will help in curbing tax evasion in the following ways:
Tax authorities will have access to transactions as they take place in real-time
since the e-invoice will have to be compulsorily generated through the GST
portal.
There will be less scope for the manipulation of invoices since the invoice gets
generated prior to carrying out a transaction.
It will reduce the chances of fake GST invoices and the only genuine input tax
credit can be claimed as all invoices need to be generated through the GST
portal. Since the input credit can be matched with output tax details, it becomes
easier for GSTN to track fake tax credit claims.
What are the mandatory fields of an e-
invoice?
E-invoice must primarily adhere to the GST invoicing rules. Apart from this, it should
also accommodate the invoicing system or policies followed by each industry or sector
in India. Certain information is made mandatory whereas the rest of them is optional for
businesses.
Many fields are also made optional and users can choose to fill up relevant fields only. It
has also provided a description for every field along with the sample inputs for the
interested users. One can see that certain required fields from the e-way bill format are
included now in e-invoice such as the sub supply type.
The following fields of an invoice must be compulsorily declared in an e-invoice:
Sl. Name of the field List of Choices/ Specifications/Sample Remarks
no. Inputs
1 Invoice Type Max length: 10 Denotation for regular, SEZ
supplies with payment, SEZ
Can be one of the following:
supplies without payment,
Reg/SEZP/SEZWP/EXP/EXPWP/DEXP deemed exports, sale from
the bonded warehouse,
export without payment of
tax, export with payment of
tax
2 InvoiceType Code Max length: 50 A subcode may also be
automatically added by the
Will be auto-generated by GSTIN
GSTN
based on the invoice type specified by
the user
3 Supplier_GSTIN Max length: 15 GSTIN of the supplier raising
the e-invoice
Must be alphanumeric
4 Invoice Number Max length: 16 For unique identification of
the invoice, a sequential
Sample input is
number is required within the
“ Sa/1/2019” business context, time-frame,
operating systems and
records of the supplier. No
identification scheme is to be
used
5 Preceeding_Invoice_Reference Max length:16 Detail of original invoice
which is being amended by a
Sample input is
subsequent document such
“ Sa/1/2019” as a debit and credit note. It is
required to keep future
expansion of e-versions of
credit notes, debit notes and
other documents required
under GST
6 Invoice Date String (DD/MM/YYYY) as per the The date when the invoice
technical field specification was issued. However, the
format under explanatory
notes refers to ‘YYYY-MM-
DD’. Further clarity will be
required
7 Reverse Charge ‘Y’ or ‘N’ as a single character Mention whether or not the
particular supply is subject to
reverse charge mechanism
8 GSTIN Max length: 15 The GSTIN of the buyer to be
declared here
9 State Code Max length: 2 The place of supply state
code to be declared here
10 Place Max length: 50 The place
(locality/district/state) of the
buyer on whom the invoice is
raised/ billed to must be
declared here if any
11 Pincode Six digit code The place
(locality/district/state) of the
buyer on whom the invoice is
raised/ billed to must be
declared here if any
12 Unique Identification Number Abbreviated as ‘UUID’ A unique number will be
generated by GSTN after
Max length: 50
uploading of the e-invoice on
Sample input is ‘649b01ft’ the GSTN portal. An
acknowledgement will be
sent back to the supplier after
the successful acceptance of
the e-invoice by the portal
13 ShippingTo_GSTIN Max length: 15 GSTIN of the buyer himself or
the person to whom the
particular item is being
delivered to
14 Shipping To_State Max length: 100 State pertaining to the place
to which the goods and
services invoiced were or are
delivered
15 Supply Type Max length: 2 It can be either interstate or
intrastate supply. Further, it
Sample values can be either of
can be outward or inward
Supply/export/Job work
supply
Moreover, the supply can
further be classified as
import, export, job work, for
own use, return, sales
return, others, SKD/CKD/Lots,
line sales, recipients not
known, exhibition or fairs
16 Transaction Mode Max length: 2 A combination of a ‘Bill To
Ship To’ and ‘Bill From
The schema specifies that the field can
Dispatch From’ is also
have either of regular/bill to/ship to
allowed
17 Item Description Max length: 300 Simply put, the relevant
description generally used for
The sample value is ‘Mobile’
the item in the trade.
The schema document refers to this as However, more clarity is
the ‘identification scheme identifier of needed on how it needs to be
the Item classification identifier’ described for every two or
more items belonging to the
same HSN code
18 Quantity Decimal (13,2) The number of items (goods
or services) that is charged on
Sample value is ‘10’
the invoice as a line item.
19 Rate Decimal (10,2) The unit price, exclusive of
GST, before subtracting item
Sample value is ‘50’
price discount, can not be
negative
20 Assessable Value Decimal (13,2) The price of an item,
exclusive of GST, after
Sample value is ‘5000’
subtracting item price
discount. Hence, Gross price
(-) Discount = Net price item,
if any cash discount is
provided at the time of sale
21 GST Rate Decimal (3,2) The GST rate represented as a
percentage that is applicable
Sample value is ‘5’
to the item being invoiced
22 IGST Value, CGST Value and Decimal (11,2) For each individual item,
SGST Value Separately IGST, CGST and SGST amounts
Sample value is ‘650.00’
have to be specified
23 Total Invoice Value Decimal (11,2) The total amount of the
Invoice with GST. Must be
rounded to a maximum of 2
decimals
E-invoices Format
The e-invoice format is released by GSTN in consultation with the ICAI is as follows:
E
invoice-final-format.pdf
