Govt to present system Here is all you want to understand.
New Delhi, Nov 28: The upcoming’E-invoicing’ system is going to be a boon to MSMEs as it will open the centre of immediate bank loans for MSMEs. Together with the new system of E-invoicing, banks might not call for a plethora of physical files and their approval processes instead they could do MSMEs’ ratings for the loan on the grounds of their e-invoicing. Additionally, the E-invoicing will bring in ease of doing business as it will pre-populate that the GST returns apart from reducing the reconciliation problems.
The government has made a decision to launch’E-invoicing’ in a standardised way for producing business to business (B2B) statements on voluntary basis. It’s been determined by the authorities that companies using a turnover of Rs.500 Crore or would occupy E-invoicing from 1st January 2020 on voluntary and path basis while the businesses with turnover of Rs.100 Crore or more would begin E-invoicing on trial and voluntary basis from 1st February 2020.
But from 1st April 2020 the E-invoicing will be compulsory for both these businesses categories. For companies it might stay voluntary and on trial basis from 1st April 2020.
The basic goal behind adoption of process is to ease convenience to the citizens. By pre-populating the yields During E-invoicing the taxation department would help the businesses and citizens and this would result in lessening the reconciliation problems. Actually the fundamental principle behind introducing the e-invoicing would be to put the technology in the service of these people to make ease of living and ease of conducting business.
The E-invoicing system will help to create invoice in a standard format in order that invoice generated on one system could be read by another system and reporting of e-invoice to some fundamental system becomes possible. The adoption of these standards wouldn’t impact the users of invoice; however, all the accounting applications would adopt the new e-invoice standard wherein they’d re-align their information access and retrieval in the typical format.
The generation of e-invoice are the responsibility of the taxpayer who will be asked to report the same to Invoice Registration Portal (IRP) of GST. This portal will generate a unique Invoice Reference Number (IRN) and digitally sign the e-invoice and also generate a QR code. The QR Code will contain vital parameters of this e-invoice and return the exact same to the taxpayer who generated the record in first place. The IRP will send the on the email provided in the e-invoice to the document’s receiver.
E-invoice wouldn’t mean generation of invoices. The citizen would continue to use his accounting system/ERP or excel based tools or such a tool for creating the electronic invoice as is using now. To attain this goal there would be a need to standardize the format in which digital information of an Invoice will be shared between different stakeholders to guarantee interoperability of their data.