Electronic Invoicing is the one of the most talked about changes when it comes to GST in 2020-21. It is the present and the future of invoicing. In Spite of the established way of preparing invoices, e-invoicing was taken in good spirit by the overall taxpayers. Also the companies with more than ₹100 crores turnover have also gone live with E-invoicing mandate from 1st January 2021.
Before we go ahead, we need to understand what distinguishes an e-invoice from other invoices.
“Change is the law of life and those who look only to the past or present are certain to miss the future”
- John F Kennedy
What is an e-invoice?
An e-invoice is often confused with a digital invoice but in reality it is much more than that. It is an electronic mechanism under GST which is generated by taxpayers and is reported to the GST system. All B2B invoices generated need to be registered with the Government system i.e. the Invoice Registration Portal (IRP) & obtain an unique number i.e. Invoice Reference Number (IRN) & QR code which are the most vital aspects of an e-invoice.
Once the invoice is authenticated, the details shall be available at the GST portal & EWB portal at the real time
By e-invoicing, some Unnecessary steps like data entry, accuracy checks & swapping platforms are eliminated.
Let us now understand the process of creating an e-invoice
Many taxpayers have a thinking that they have to do something extra and beyond their existing business practices to create an e-invoice but that is not the case.
The creation of e-invoice is very simple. In fact, the taxpayers will continue to issue their invoices in the same manner that they have been practicing till now.
The only change that is required from a billing, accounting and ERP software companies which will make certain changes at their backend so that the software that you are using to issue invoices is able to push the invoices to the IRP.
The IRP will assign the IRN to the invoice, digitally sign and send it back with a QR code to the billing & accounting software.
The QR code will contain all the essential details like the supplier GSTIN, buyer GSTIN, description of goods and services being supplied, value etc.
This would have made clear how simple the e-invoicing system is.
Let's take a look into the benefits of E-invoicing
- Invoice Creation
Easy Invoice Manager by GimBooks provides you user-friendly tools that allow you to customize the document according to the requirements. It reduces the time open the spreadsheet and edit the modules for the perfect layout.
2. Delivering & Receiving e-invoice
If you send a pdf of invoice to your customer, they will need to review it and import it to their ‘Accounts Payable’.
But when you send an e-invoice, it will directly appear in their Account Payable where they can accept, pay and then achieve it within the software.
3. E-invoice brings Transparency
As only authenticated invoices with Invoice Reference Number (IRN) shall be uploaded, an e-invoicing system brings more transparency in reporting.
4. Unique IRN & QR code
IRN proves the authenticity of an invoice and QR code allows to quickly access the invoice details & information. When the recipient scans the QR code, he will be able to see all the relevant information of that invoice in their system.
5. Claiming Accurate ITC
With the e-invoicing system, no invoices will be hidden or missed from the system. The reconciliation will be accurate and detailed which would help the taxpayers in claiming maximum ITC.
6. Reduces Cost
Why waste resources like paper when you can send documents electronically? Right?
With paperless invoicing, you are saving on paper costs and courier costs for sending the invoices physically to the recipients.
7. Reduction in human errors
The e-invoicing process is fully automated. Hence, reduces human intervention & brings more accuracy in the invoice generation & GST filing.
Under the e-invoicing system, the invoice is uploaded on a common portal which facilitates multipurpose reporting. It will eliminate the need of data entry and also reduce data entry errors.
8. Track of Invoices
It is a lot easier to keep a track on information like when the invoice was sent, viewed and paid through e-invoicing software.
9. Easily customizable
Now you do not need to waste your time in editing the spreadsheet modules. Get easily customizable industry-specific invoice templates making it look more
10. Increased Data Integrity
One of the biggest advantages of e-invoices is that it reduces the risk of fraudulent bills. The authenticity of e-invoices is automatically validated.
11. Higher degree of control
The benefit of using online e-invoicing software is that everything is saved on one platform and is easily accessible anywhere & anytime. Also, you will be getting an overview of your invoicing through analytics and automated reports.
12. Advantages for Buyers
When an e-invoice is uploaded on GST portal for authentication, it will be shared with the buyer to reconcile his purchase and accept / reject the invoice on a real- time basis.
13. One time reporting B2B invoices
A taxpayer has to report the invoices just once & get it authenticated by Invoice Registration Portal which then issues the Invoice Reference Number (IRN).
The details will be auto-populated to the GST Return & reduces the manual reporting process.
14. Seamless invoice transmission
The recipient would receive the e-invoice automatically either through mail or through separate messaging platforms
Implementing an e-invoicing system is highly beneficial for any business. And that is the reason Electronic invoicing is increasingly utilized all across the globe every day. It also supports the digitization of the economy and the business can get the maximum fruit out of the IT infrastructure.
GimBooks provides you one platform for all your business related data so that you do not need to switch between different platforms for say contact details or creating & sending invoices.
You also get various features like automatic payment tracking & analytics of your invoicing.
Do you want to create and send invoices smoothly?
Switch to Easy Invoice Manager by GimBooks.