What is an e-Invoice?

Electronic invoice i.e. e-Invoice is an invoice in standard electronic format. It eliminates operational costs spent on manual work due to which the process of sending and sharing of invoices between a buyer and a seller becomes more efficient. 

According to the GST notification, e-Invoicing has become mandatory for the taxpayers having aggregate turnover above Rs. 100 Cr from 1st January 2021 and will be made available to all taxpayers for B2B transactions from 1st April 2021. Under this mandate, taxpayers will have to register the generated e-invoice on the Government portal- Invoice Registration Portal (IRP). 

 e-Invoicing Process:

Under the e-invoicing mandate all B2B Customers would have to generate an invoice using any ERP or accounting system. The taxpayers need to upload the generated invoice in JSON format on the official e-invoicing portal set up by the Government (IRP). In response to this an Invoice Registration number (IRN) is generated unique to every invoice. IRP will then validate the IRN by doing a duplication check and return a digitally signed invoice along with the QR code. 

  Advantages of e-Invoicing:

Reduced manual work: Even though invoices are created using an accounting software, human intervention is required for the sharing of invoices. E-invoicing eliminates this process by sharing the invoices between the buyer and the seller in electronic format.

Speed up Invoicing process: e-Invoicing has led to minimizing the manual input and maximizing automation to speed up the Invoicing process

Prevent data entry errors: With the implementation of e-Invoicing process the errors caused due to manual work such as the wrong amount being sent or typos when entering bank account details, etc is reduced. 

Reduced chances of fraud and risk: Real-time availability of data with tax authorities has led to a reduction in frauds

Real-time invoice tracking: E-invoicing allows real-time tracking of invoices prepared by a supplier.

Get paid faster: e-Invoicing solution enables you to make your entire invoicing process paperless and effortless so that the customer’s will most likely pay faster

Better security: Secure exchange of all invoices through encrypted transmission procedures.

Reduction in cost: E-Invoicing allows sellers to save money that is spent on printing and posting of paper invoices, responding to customer requests for copies of lost invoices.

Considerably less impact on the environment: Sending invoices electronically eliminates the need of printing paper invoices and reducing carbon footprint

 The e-invoice system will help to curb tax evasion and reduce the number of fraud cases as the tax authorities will have access to data in real-time. Thus selecting the right invoicing solution can play a crucial role in streamlining your invoicing process, improve your cash flow, and even simplify your accounting.

 E-Lock e-Invoicing solution enables you to make your invoicing process efficient, while managing the entire communication with the GST systems in a hassle-free manner.