E-Invoicing and GST New Return : An Alert

[Ganeshan Kalyani]

The Government has notified 01.04.2020 as the date when e-invoicing and new GST return will come into effect. 

As a first phase the tax payers having turnover more than one hundred crores is covered under the requirement of e-invoicing. Going forward all the tax payers will be brought under the requirement of e-invoicing. 

All B2B taxable supplies including credit note , debit note having tax component are covered under this e-invoicing requirement . In addition to the said transaction types exports both with or without payment of tax is covered under e-invoicing. Likewise supplies to SEZ is also covered in e-invoicing. 

E-invoicing means validating the invoice by sending invoice details to the government portal specifically made for validation purpose. The websites are called as "Invoice Registration Portal". In short it is called as IRP. The purpose of IRP is to generate an "Invoice Reference Number". In short it is called as IRN. The IRP shall also generate "Quick Response Code". In short it is called as QR Code. These two things i.e. IRN and QR Code is a sought of confirmation of the validation of the invoice data sent to it by the taxpayer for invoice validation.

The tax invoice and other documents having GST must have IRN and QR Code. Without these two things an invoice is not a valid invoice. Penal provision is applicable in case of non-compliance.

The taxpayers have got very little time to make all configurations in their accounting software to be ready to do e-invoicing. In a big company it is a mammoth task. IT team and tax team must team up to complete the integration task.

The tax payer falling under the requirement of e-invoicing must first of all  validate their customer's  GSTIN available in their customer master. Then they have to validate other details including PIN. This is because IRP would not validate the invoice unless the mandatory fields are correct. 

New GST return is also coming into effect from 01.04.2020. With the advent of new return the existing return viz. GSTR 3B, GSTR 1 etc will go away. The new return is an automated return more particularly the Input tax credit part. In this system the invoices which the supplier has uploaded and the same is being replicated in the buyer's GSTIN will only become the input tax credit. 

Start the preparation work. First of all list down the types of taxable outward supplies, document types, tax codes and make a control sheet which is necessary for the integration of sales register with the ASP- GSP. 

User training is utmost important within organization as well as to the customers and suppliers. Awareness session is a need of hour to be started. This is not a one man task and therefore everyone especially raising sale invoice, doing despatch, passing financial credit note and debit note need to be educated.

Even though FAQs is being published by GSTN.org but still there are issues which are open. Like for e.g. credit note raised post implementation against the invoice issued before e-invoice whether IRP will validate it is still a open query. Looking into the difficulties it is a valid expectation that the govt must first clarify those queries and then implement the e-invoice. Otherwise lot of tax payers will face challenges.