What is e-Invoicing in GST - Meaning, Benefits & How to Generate?
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E-invoicing is a big step forward in the Goods and Services Tax (GST). This system, managed by the Goods and Services Tax Network (GSTN), is like a new beginning for businesses. It involves digitally verifying all Business-to-Business (B2B) invoices. This article will help you learn what e-invoicing means, how it works, and the many benefits it brings to businesses following the GST rules.

Understanding E-Invoicing in the Case of GST

Businesses can still use their Enterprise Resource Planning (ERP) systems to create invoices among the new E-invoicing systems. However, ERP providers must make specific adjustments to their systems to match the standardised format required by the GSTN. This standardised format is important as it ensures all invoices follow a consistent structure, making the invoicing process more efficient and proper. Following this standard format benefits businesses by promoting an equal approach to invoicing, ensuring compatibility and easy interactions within the new e-invoicing system.

Benefits of the e-Invoicing System

Real-time Tracking of Invoices

One of the primary advantages of E-Invoicing lies in its ability to carry out real-time tracking of invoices. With suppliers generating invoices electronically, businesses can enjoy faster access to Input Tax Credit (ITC), enhancing financial easiness.

One-time Reporting of B2B Invoices

Under the e-Invoicing system, businesses are required to report/ upload the B2B invoices into the Invoice Registration Portal (IRP). Once B2B invoices are uploaded into the IRP  it generates and assigns the unique Invoice Reference Number (IRN) to each invoice and issues the e-invoices. These invoices are then   with automated details transferred to the GSTR-1 return, which simplifies the manual reporting procedure.

Easy Creation of e-Way Bill

The E-Invoicing system simplifies the generation of e-Way bills. Businesses can quickly generate e-Way bills by updating vehicle details, with Part-A details auto-populated from e-invoices authenticated on the GST portal.

Enhanced Buyer Interaction

Upon authentication, e-invoices are shared with buyers via email. This interaction not only aids buyers in purchasing orders with e-invoices but also allows real-time acceptance or rejection of invoices, showing a transparent and collaborative scene.

Fraud Reduction and Data Entry Accuracy

The real-time availability of data to tax authorities contributes to a reduction in fraud. Simultaneously, auto-populating invoices to the GST portal minimises the need for manual data entry during GST returns filing, consequently reducing data entry errors.


E-invoicing depends on interoperability, enabling invoices generated in a standardised format to be read by different software. This easy integration enhances operational efficiency and collaboration across diverse software platforms.

Curbing Tax Evasion

Real-time data access allows invoice manipulation, as invoices are generated before transactions. This, in turn, reduces the potential for fake GST invoices, ensuring only genuine Input Tax Credits can be claimed by customers. The readily available input and output of tax details help tax officials track and catch fraudulent activities effectively.

QR Code Integration

Including QR codes in e-invoices is a practical solution for instances where invoices may be misplaced or require additional copies. By scanning the QR code, businesses can easily generate the GST e-invoice multiple times in PDF format, with proper accessibility and convenience.

A Step-by-Step Guide to Generating an E-invoice

The introduction of e-invoicing has transformed how businesses handle their invoicing procedures. Taxpayers will continue generating invoices in their fashion, but with the transition to e-invoicing, the reporting aspect takes on a digital form. Here is a comprehensive guide on the mandatory and optional pointers that taxpayers need to follow while generating an e-invoice:

  1. Transaction Details: Include details of the tax scheme and supplier type.
  2. Document Details: Specify the document type, document number, and date of issuance.
  3. Supplier Information: Provide essential details about the supplier, including legal name, GSTN address, location, PIN code, state code and place of supply (‘POS’)
  4. Buyer Information: Proper buyer details such as legal name, GSTN number, address, location, state code, and PIN code.
  5. Dispatch from Address: Mandatory if different from the supplier's details.
  6. Shipping Details: Mandatory if different from the buyer's address.
  7. Item-Related Details: Include specifics on the service/goods, SAC/HSN code, total amount, GST rate, assessable amount, and total item value.
  8. Batch Number (if applicable): If items are moved in batches, include the batch number.
  9. Invoice Details: Capture assessable values and the total invoice value.

In addition to the mandatory rules, there are optional rules listed by the Council, which may evolve based on business needs. Once the invoice fields are finalised, taxpayers need to assess whether their accounting or billing software is there to generate a JSON (JavaScript Object Notation) file. Customers can upload JSON files to the Invoice Registration Portal (IRP).

Read Also: Eway Bill - What is Eway Bill? E Way Bill System


E-Invoicing is like a big upgrade for businesses dealing with GST. Managed by the Goods and Services Tax Network (GSTN), it's a new way of handling Business-to-Business (B2B) invoices by checking them digitally.

Even though businesses can still use their usual Enterprise Resource Planning (ERP) systems, they must match the standard format GSTN requires for smooth integration. For those looking to make the most of e-invoicing, AllPay e-invoicing by Kotak Mahindra Bank offers a robust solution. With features like custom branding, easy integration, various payment options, and a single dashboard to manage everything, businesses can simplify payments and make things better for customers.

Thus, e-invoicing is more than just following rules; it's a step toward a better, more efficient future for businesses in the GST system. Adapting to this digital change puts businesses ahead in modern financial practices, ensuring they stay flexible and competitive in today's swift-paced business setting.

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Disclaimer: This Article is for information purposes only. The views expressed in this Article do not necessarily constitute the views of Kotak Mahindra Bank Ltd. (“Bank”) or its employees. The Bank makes no warranty of any kind with respect to the completeness or accuracy of the material and articles contained in this Article. The information contained in this Article is sourced from empaneled external experts for the benefit of the customers and it does not constitute legal advice from the Bank. The Bank, its directors, employees and the contributors shall not be responsible or liable for any damage or loss resulting from or arising due to reliance on or use of any information contained herein. Tax laws are subject to amendment from time to time. The above information is for general understanding and reference. This is not legal advice or tax advice, and users are advised to consult their tax advisors before making any decision or taking any action.