E-Invoicing signals a paradigm shift in Tax Administration.
                     E-INVOICING 
SIGNALS A 
PARADIGM SHIFT 
IN TAX 
ADMINISTRATION
INTRODUCTION
• The immediate backlash from 
businesses following the rollout of the 
goods and services tax (GST) in 2017 
had forced the government to go slow 
on implementing the monitoring 
mechanism to ensure compliance. 
• Efforts are being made to plug the 
loopholes in the indirect tax system 
through a series of small steps to 
enhance the tax authority’s enforcement 
capabilities.
Source: livemint.com
E-INVOICING FACILITY
• The e-invoicing facility, which came into 
effect on 1 October, GST authorities are 
able to monitor every business-to-
business transaction of large firms even 
before the goods change hands. 
• Tax experts said the move gives tax 
authorities unprecedented access to 
data involving the finer details of 
transactions between firms.
Source: livemint.com
DIGITAL VERSION OF AN 
INVOICE 
• GST e-invoice is the digital version of an 
invoice for goods and services by 
businesses that will be usually 
generated on the government regulated 
IRP portal and have been introduced to 
primarily avoid tax evasion.
Source: businessworld.in
MANDATED
• The e-invoicing will be mandated for 
companies with an annual turnover of 
₹500 crores or more. 
• Businesses generating the e-invoice will 
be issued a unique identification number 
provided by the Invoice Registration 
portal (IRP) that will directly be 
managed by the GST Network (GSTN).
Source: businessworld.in
How is this different from the 
conventional invoice system?
• Currently, businesses are generating 
invoices via various software and the 
details of which were later uploaded in 
the GSTR-1. 
• However, the latest e-invoicing process 
mandates the cosigners or transporters 
to send the invoice again by importing 
them in an excel or JSON format. 
• Another way the e-invoice can be 
submitted is via the API integration, 
directly through the GST Suvidha 
Provider (GSP).
Source: businessworld.in
How does e-invoicing work?
• The e-invoicing workflow is slightly 
different than the conventional, mainly 
because of the digital element and the 
need to embrace transparency among 
all stakeholders. 
• The e-invoice will be generated using 
Government approved GST software and 
solutions and will be uploaded on the 
Invoice Registration Portal (IRP). 
Source: businessworld.in
Invoice communication between the 
taxpayer and the government
• Taxpayers will upload mandatory 
information from the invoice in JSON 
format on the IRP via a myriad of 
communication channels like GSP/API, 
Web Portal, and Offline Tools. 
• The platform will generate the IRN, 
check the GST system for imitations, 
check for the e-invoice data, add a 
digital signature, and finally add the QR 
Code. 
Source: businessworld.in
Invoice communication between IRP 
GST and the E-way bill system
• Here the process is quite similar till the 
bill reaches the Invoice Regulation Portal. 
• The turn comes in when the final payload 
goes to the GST system and as well as the 
e-way bill system where the latter will 
generate the e-way bill. 
• The GST system has two pathways for the 
invoice – ANX-1 for the seller and ANX-2 
for the buyer. 
• This makes it easier for the buyer to view 
the invoice data as well as receive the QR 
code for printing.
Source: cleartax.in
How to generate an e-invoice?
• Generating e-invoice will be similar to the 
traditional method except that reporting 
will now be undertaken electronically. 
Here is a list of new and mandatory as well 
as optional prerequisites:
• Document details: type, number, and date
• Item related details like service/ goods, HSN code, 
total amount, GST rate, Assessable amount, total 
item value.
• Supplier information like legal name, GSTN 
address, location, PIN code, and state code.
• Buyer information like legal name, GSTN number, 
address, location, state code, and PIN code
• Transaction details like tax scheme, supplier type
Source: CNBCTV18.in
What are the benefits of e-invoicing?
• E-invoicing is here to change the tax 
paradigm and will be benefiting business 
in the following manners:
• There are prevailing gaps between 
data collection under GST. This e-
invoicing will help plug those gaps 
and reduce errors.
• Moreover, stakeholders can now view 
these invoices instead of banking 
solely on the supplier’s words, which 
improves transparency and reduces 
data entry errors.
Source: businessworld.in