Impact of E-invoicing on business and processes

E-invoicing being a new requirement under GST laws and involves a high level integration between taxpayer ERP software and government portals such as IRP, e-waybill and GSTN portal. It brings number of challenges with regard to the way business processes are currently being followed by taxpayers. Implementing it may also result in slight business disruption as all invoices issued on or after April 1, 2020 will require IRN or QR code, as the case may be, hence requires immediate attention from business process update stand point.

Businesses that would have got their systems integrated with government’s e-waybill portal or GSTN portal, will now again have to re-configure their ERP system in order to interact with IRP portal for generating IRN or QR code. Also, invoice printing infrastructure will also have to be re-configured to capture additional fields of e-invoice such as QR Code etc. and all such changes in the IT systems will involve significant working capital of business to be invested into. Another area of challenge for the businesses will be to ensure detailed trainings and education sessions for their personnel who are involved in GST compliances.

Above said, with the challenges that embodies the proposed e-invoicing system, subsequently, businesses will tend to save time and efforts as far undertaking GST compliance is concerned. An automated system will eliminate human errors and ensure correct invoice information being fed whereby the ever facing issues around fake and incorrect Input Tax credit availment, would be curbed to a great extent.

Key considerations from Business perspective:

  • Identifying all possible transactions attracting e-invoicing (like exports/imports/cross charges/Asset transfers etc.)
  • Requirements of updating masters of Vendors and Customers to cater to additional information required for invoices (like Payee details/Bank Details/PIN codes etc.)
  •  Accounting system updation/ customization to have required interface with the Govt. portal;
  • Flagging Vendors into small and large categories to identify data collation requirements (Auto populated for large vendors covered by e-invoice and manual for small)
  • Changes to GST returns preparation process so that B2B supplies shall be auto populated in the GST returns and B2C supplies shall be manually uploaded
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