India’s Best e-Invoice Software to Simplify Your GST e-Invoicing

Electronic invoicing, or e-Invoicing in India, is a system for creating invoices in which invoices generated by one software can be accessed by other software, hence reducing the need for new data entry or errors. In simpler terms, it is an invoice prepared using a standard format in which the electronic information of the invoice can be shared with others, ultimately ensuring information compatibility.

Electronic Invoicing refers to a system in which Business-to-Business (B2B) invoices, Export invoices, and Credit/Debit Notes are electronically certified by GSTN for use on the common GST site. An e-invoice verifies transactions and assigns a unique identifier (Invoice Registration Number or IRN) to each invoice, which is subsequently handled by GSTN's Invoice registration site (IRP).

E-invoicing is the new method of making invoices and will undoubtedly be the future of billing. E-invoicing was adopted for a variety of reasons and is a superior approach to PDF or conventional papers. E-invoicing is only possible with specialised software. Marg ERP is a remarkable e-invoicing software with the most recent features and upgrades.

The invoicing software of the seller generates an electronic invoice in a structured format with encrypted data in XML or EDI. Alternatively, the format is prepared in web-based forms and distributed to both the vendor and the buyer.

The CBIC has announced the 6th phase of e-invoicing, which requires businesses with a turnover of ₹5 crore or more in any financial year since 2017-18 to issue e-invoices starting from August 1, 2023. This step is part of the government's plan to shift towards a digital economy. Prior to this announcement, electronic invoicing was mandatory for companies with a turnover of ₹10 crores or more, and from January 1, 2023, it will also be mandatory for businesses with a turnover of ₹5 crores or more for business-to-business transactions, whereas earlier this was required for companies with a turnover of ₹20 crores or more.

According to tax officials, e-invoices have a number of benefits including :

• Auto-reporting of invoices into GST returns and auto-generation of e-way bills.
• It will eliminate mismatch mistakes, e-Invoice resolves and plugs a critical gap in data reconciliation under GST.
• E-invoice allows for real-time tracking of invoices prepared by the supplier.
• Standardization and interoperability will be facilitated by e-invoicing, resulting in fewer conflicts between transacting parties, shorter payment cycles, lower processing costs, and increased overall corporate efficiency.

Electronic invoicing, also known as eInvoicing, is a form of electronic billing. This method was used by trading partners, customers, and their suppliers to represent and track transactional documents between one another to ensure the terms of their business agreements are being met.

The reason behind the introduction of electronic invoices or e-invoicing is:

The primary duty of the accounts payable department is to guarantee that all unpaid invoices from its suppliers are authorized, handled, and paid. Processing an invoice involves capturing relevant data from the invoice and entering it into the business’s accounting or financial systems.

Once the feed is completed, the bills must travel through the business procedure of the company to be paid.

An e-invoice is a structured invoice issued in EDI or XML formats, sometimes through online web forms. These papers can be transmitted through EDI, XML, or CSV files, among other methods. Emails, virtual printers, web apps, and FTP sites can all be used to upload them.

Data from PDF or paper invoices may be extracted using imaging software by the business and entered into their invoicing system. Moreover, To avoid mismatch mistakes, the GST data reconciliation process has a significant gap that is closed and plugged using e-invoice.

Data exchange and a decrease in data entry errors are made possible by the ability of different applications to read electronic invoices. E-invoice makes it possible to track supplier-prepared invoices in real-time.

If a taxpayer’s e-invoice limit or turnover exceeds the specified limit in any fiscal year from 2017–18 through 2021–22, they must comply with e-invoicing beginning in FY 2022–23. Additionally, the total turnover in India will comprise the total turnover of all GSTINs that fall under a single PAN.

Earlier for taxpayers, aggregate sales over Rs. 500 crore GST e-Invoicing system went into effect on October 1, 2020. From January 1, 2021, eInvoicing was made available to companies with a combined turnover of more than Rs. 100 crore.

The CBIC also announced on March 8, 2021, that enterprises who have annual sales between Rs. 50 crore and Rs. 100 crore will be eligible to use the e-invoicing system beginning on Ap, April 1, 2021.

With effect from April 1 2022, the government recently expanded the use of electronic invoices to companies with annual sales of more than Rs 20 crore. The system will very soon be expanded to include companies with annual revenues exceeding Rs. 10 crores starting on October 1, 2022.

Starting August 1, 2023, the CBIC has announced the 6th phase of e-invoicing, which mandates businesses that have had a turnover of 5 crore or more in any financial year since 2017-18 to issue e-invoices. This is part of the CBIC's efforts to promote a digital economy.

The whole turnover of all GSTINs in India under a single PAN would be included in the aggregate turnover for e-invoicing. You can check and confirm the GSTIN for which you wish to raise the e-invoice using the GST search tool if you have several GSTINs on hand.

E-invoice penalties can significantly strain the reputation and cash flow of applicable businesses. In addition to the penalty for not generating an e-invoice, any violation of the e-invoicing regulations may result in many other negative outcomes.

The person whose business turnover is more than 5 Crores must generate e-invoices else you have to pay the penalty for not generating the e-invoice, such as:

• Each invoice has a penalty of 100% of the tax owed or Rs. 10,000, whichever is larger.
• 25,000 per invoice in fines for inaccurate invoicing.
• Rule 48(5) mandates that if an e-invoice is not issued, even when one is mandated, the invoice that is issued shall not be considered genuine. Therefore, it is regarded as a failure to issuance an invoice if a taxpayer fails to create IRN.
• According to Section 129 of the CGST Act 2017, and transportation of products that do not follow the guidelines established by the GST Act may result in the detention of those commodities.
• Starting the transportation of goods without a legitimate tax invoice with an IRN may result in the detention of the products and the vehicles since an invoice without a QR code is not to be deemed to be a genuine invoice. This might also lead to an e-way bill penalty.