GST eInvoice is an electronic invoicing system established under GST legislation, analogous to the e-way bill system utilised by GST-registered businesses to transport goods. This mandate requires specific GST-registered entities to generate GST eInvoices for their Business-to-Business (B2B) transactions to ensure compliance and standardisation. Effective August 1, 2023, the e-invoicing mandate has been broadened to encompass all GST-registered entities whose aggregate turnover exceeds five crores in any fiscal year from 2017-18 onwards, as determined by their PAN.

What is GST eInvoice?

GST eInvoice, or electronic invoicing, refers to the system where Business-to-Business (B2B) invoices are electronically authenticated via a specified portal. This process entails electronically submitting invoices for validation.

Once verified, the Invoice Registration Portal (IRP) assigns each invoice a unique invoice reference number (IRN). The system also endows each invoice with digital signatures and embeds a QR code. This comprehensive process is called e-invoicing within the GST (Goods and Services Tax) framework.

Eligibility Criteria for GST eInvoice Implementation

The GST eInvoice requirement encompasses all entities registered within the Goods and Services Tax (GST) framework that generate Business-to-Business (B2B) invoices.

GST eInvoice Structure

The eInvoice system under GST mandates using Form GST INV-1, setting a standardised schema for electronic invoice generation. This form outlines the required format or structure for capturing and reporting invoice details electronically. When submitting these details to the Invoice Registration Portal (IRP), they must be formatted in JSON.

The format is divided into eight key sections, each designed to capture specific aspects of the transaction:

• Basic Details: Captures essential invoice information.
• Invoice Period: Defines the billing period for services.
• Preceding Document / Contract Reference: Links to any preceding documents or contracts related to the invoice.
• Receipt / Contract References: Includes references for receipts or contracts if applicable.
• Supplier Information: Details about the supplier issuing the invoice.
• Buyer Information: Information on the recipient of the goods or services.
• Payee Information: Details of the party making the payment if different from the buyer.
• Delivery Information: Information regarding the delivery of goods or services.

Within these categories, specific details such as item descriptions, document totals, and additional information like export port codes or product batch details must be meticulously recorded.

It’s crucial to recognise that while certain fields are mandatory for all eInvoices submitted to the IRP, others may be optional, contingent on the transaction type and business requirements. This structured format ensures that electronic invoices are consistent, detailed, and fully compliant with GST regulations.

Essential Components Required on eInvoices

For eInvoices to meet compliance standards and ensure precise reporting, incorporating specific mandatory details is crucial. These indispensable elements include:

• Supply Type Code: Clarifies the nature of the transaction, such as B2B (Business-to-Business), EXPWP (Export with Payment), or SEZWP (Special Economic Zone with Payment).
• Document Type Code: This code identifies the nature of the document, such as INV for Invoice, CRN for Credit Note, or DBN for Debit Note.
• Document Number: The unique invoice number that adheres to GST regulations.
• Document Date: The issuance date of the invoice.
• Supplier’s Legal Name: The registered legal name of the supplier as per GST records.
• GSTIN of Supplier: The GST Identification Number associated with the supplier.
• Supplier’s Address: Detailed supplier address, including flat and building details.
• Supplier’s Location: Specifics include the supplier’s place, state code, and the six-digit PIN code.
• Buyer’s Details: The legal name and GSTIN of the purchaser.
• Place of Supply: The state code representing the supply location.
• Itemised List: Detailed list of items or services provided, including descriptions, HSN codes, pricing, etc.
• Total Document Value: Summarizes the invoice total, including taxes, discounts, and applicable calculations.
• Ship-To Information: Details of the shipping destination if it differs from the purchaser’s address.

GST eInvoice Generation and Integration with GST Returns

The GST eInvoice system streamlines the invoicing process through a well-defined workflow, ensuring compliance and efficiency. Here’s a breakdown of the steps involved:

GST eInvoice Generation Process:

• Invoice Creation: Businesses craft invoices via their accounting or ERP systems, adhering to the GST-prescribed eInvoice format.
• Compliance Check: The generated invoice undergoes a validation process against GST regulations to identify and rectify any inconsistencies or errors.
• Registration on GST Portal: Post-validation, the invoice is registered on the GST portal, which assigns a unique Invoice Reference Number (IRN).
• Transmission to Recipient: The validated and registered invoice and its IRN are then forwarded to the recipient of the goods or services.
• Automated Reporting: The invoice information is directly reported to the GST portal, bypassing manual entry and streamlining the compliance process.

Integration with GST Returns:

Integrating eInvoices with GST returns involves a cohesive process to ensure accurate and efficient tax reporting:

• Validation and Registration: Only validated and registered eInvoices are eligible for inclusion in GST returns, ensuring they meet all compliance requirements.
• Visibility to Recipients: Once validated, these eInvoices become accessible to recipients in the GST returns system, allowing for easy review and action.

Amendment or Cancellation of eInvoice

In the GST eInvoice framework, making changes or cancelling eInvoices involves adhering to certain guidelines:

• Cancellation Must Be Complete: eInvoices can’t be cancelled partially. If a cancellation is needed, the entire invoice must be annulled.
• 24-Hour Cancellation Window: If an eInvoice needs to be cancelled, this action must be executed and reported to the Invoice Reference Number (IRN) system within 24 hours of the original upload.
• Restrictions Post 24 Hours: Beyond the 24-hour mark, eInvoices cannot be cancelled through the IRN system. Any cancellations needed after this period must be conducted manually on the GST portal, and this must be done before the submission of the relevant GST returns.

Exemptions from the eInvoicing

As mentioned above, according to their PAN records, e-invoicing has been a requisite for all registered businesses with an aggregate turnover exceeding five crores in any fiscal year since 2017-18, as per the guidelines established.

Businesses not meeting this turnover threshold are exempt from the eInvoicing mandate.