Step-by-Step Guide to Generating E-invoice Under GST with Benefits


Generating E-invoice Under GST with Benefits
Creating an e-invoice under GST was one of the best news that the GST council provided us with in its 37th meeting. However, it can be a mundane task for a majority of the people as not everyone knows or understands what the e-invoice system is all about.


So, let’s simplify everything by taking a look for ourselves!

What Is the GST E-Invoice System?

As the name suggests, GST e-invoice is the concept that allows individuals to file for their GST returns on an individual basis, without worrying about filling up physical forms and runs submissions with the digital invoice for goods and services. The regulations generated by the government controlled GST portal allow firms to get a one-on-one experience with e-filing, eliminating the chances of GST evasion which used to take place earlier.


Currently, GST officers and the rule determining body have come together to provide businesses with a mandatory process of generating an ‘e-invoice’, for every sale that is made on the government GST portal.


However, e-invoice under GST doesn’t really require every individual to fill up the returns. The GST department has set up a bar, exceeding which the individuals will have to file for their returns.


As per the recommendations from the GST Council of India, the e-invoicing system brings 2 aspects with it:


  • Aligning the taxation process to a standard, allowing standardization and seamless exchange of data between government and individuals.
  • Government having a registered standard invoice, allowing Invoice Registration Portal (IRP), which ensures the authenticity of invoices submitted.

A Step-by-step Process to GST E-invoice Generating Procedure

Before you begin with the process of billing, you need to be very clear about certain fields in the invoice details that should be verified for the government to tally with the invoice details. Additionally, the applicants also require to submit their E-invoices over the GSTN portal to get validity around the same.


Now that we have the initial stages clear in mind, let’s go with a step-by-step guide to GST E-invoice generating procedure.


Step 1. Invoice Creation

The first step of the process begins with the creation of an invoice. To do the same, users need to create an invoice through their dedicated billing or accounting software, as prescribed by the GST council for a convenient E-invoicing.


Further, it should be noted that it is necessary for taxpayers to generate their GST E-invoicing through the government-suggested portals. While the taxpayers are free to complete their processes using any dedicated accounting software they prefer, it is necessary for them to align with the format that is prescribed by the format for a viable invoice format.


Step 2: IRN (Invoice Registration Number) Generation

The second stage of opting for GST E-invoice requires applicants to generate their IRN. Suppliers are required to generate their IRN (Invoice Reference Number) that stands unique for every individual and is created using a hash-generation algorithm.


Further, post the step of generation of the IRN, it is not very mandatory to include it in their invoices. Returns with no IRN are provided with a system-generated IRP system by the government.


Step 3:  Upload on IRP (Invoice Registration Portal)

Once you have successfully come up with your own IRN number, it’s time that you upload the invoice in the IRP portal. To register your file in the Invoice Registration Portal, it is necessary to have a JSON file for each of the B2B that you have generated via the accounting software which you prefer. However, you are also allowed to use third-party tools, provided that you follow the guidelines and submit it alongside the IRN, when submitting your file at the IRP (Invoice Registration Portal).


Step 4. IRP Validation of Information

When you upload your e-invoice, the invoice registration portal validates the hash or the IRN that is generated and comes attached to the JSON file (in the case where a supplier is filing his return) or, applicants can also try generating an IRN and later authenticate their file against GST central registry for the given financial year.


Step 5. Digital Signature & QR Code-generation

Once verified, the uploaded invoice is then updated over the registration portal’s digital signature that is held over the invoice data. A QR code is also added to JSON files at this stage.


Step 6. E-Invoice Data Transmission to GST System

The data that was previously uploaded in the government portal will now be shared with GST systems, wallowing auto-population of all the GST Amendments and Annexures.


Step 7. E-Invoice Receipt Back to the Supplier’s ERP

The last step in the process of GST E-invoice generating procedure, at this stage, the file that is digitally signed by the JSON along with a QR code and an IRN, comes back to sellers over the registered email ID.


Now, before you begin with the process of registering GST in an online portal, it is important to register yourself with the same. Once you are able to register yourself, only then will you realise the GST E-invoicing system’s beneficials.

Benefits of Opting for E-invoicing for GST

The number of advantages of an e-invoicing system is numerous, as framed by the GST Council. Let’s take a look at some of them:


  • Real-time invoice tracking
  • Elimination of fraud
  • Significant reduction in data entry errors
  • A step towards digitisation
  • QR code for simplified scanning
  • Ease of sharing to the buyers


These advantages are for the buyers, as well as, shared an inclination towards the government. Remember, digitisation is important!


Suggested above was a nutshell of all the important steps that you need to follow, in able to successfully file for a GST invoice.

Filing for an e-invoice can be a real task if you have no idea about where to begin the process. So, it is always beneficial on your end to use SAP E-invoice, for the effective functioning of your filing process.