E-Invoicing in India refers to the electronic generation and authentication of invoices under the Goods and Services Tax (GST) system. It is designed to standardize and streamline the invoicing process for Business-to-Business (B2B) transactions, exports, and certain other categories. The system ensures that invoices are reported to the GST portal and validated with a unique Invoice Reference Number (IRN) and QR code.
Conditions for E-Invoicing
- Turnover Threshold: E-Invoicing is mandatory for businesses with an annual aggregate turnover exceeding ₹5 crore in any financial year from 2017-18 onwards. (Subject to change from Government).
- Applicable Transactions: It applies to B2B transactions, exports, and supplies to Special Economic Zones (SEZs).(Subject to change from Goverment)
- Exemptions: Certain entities like banks, insurance companies, financial institutions, and passenger transport services are exempt from e-invoicing.
Documents Involved in E-Invoicing
- GST Tax Invoices.
- Debit Notes.
- Credit Notes.
- Export Invoices.
Workflow for E-Invoicing Process
- Invoice Generation: The taxpayer generates the invoice using their accounting or ERP system, adhering to the e-invoice schema.
- Reporting to IRP: The invoice details are uploaded to the Invoice Registration Portal (IRP).
- Validation: The IRP validates the invoice and assigns a unique IRN along with a QR code.
- Integration with GST and E-Way Bill Systems: The validated invoice details are shared with the GST and e-way bill systems for further use.
- Final Invoice: The taxpayer receives the validated invoice with the IRN and QR code, which becomes the legally valid document.