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Explained - What is Difference Between E-invoice and Invoice?

 


In India till now, traditional invoices were being introduced, which is now going on the traditional way to e-invoice system. Know what are the differences between traditional invoice and e-invoice system and how e-invoice system provides good service to tax payers, evasion of taxes, best GST administration and many other benefits.

 

Sl. No.

Point of comparison

Under the present system of invoicing

Under the e-invoicing system

1

Applicability

All taxpayers

E-invoice is applicable to those taxpayers who supply or export B2B, and who have a total annual turnover of more than Rs 500 crore, they have to generate e- invoice from October 1 2020 (e- invoice  also applies to those people , whose aggregate turnover is Rs 100 crore from January 1 2021.

2

Physical invoice

Physical challans / invoice will continue to be made as per the prescribed rules.

3

Reporting of invoices on the GST portal

Data is inserted by manual typing in traditional invoice. The JSON is uploaded with the help of accounting software that is used by the API to upload the data.

In modern e-invoice, data is inserted as an invoice, but it is mandatory to follow the schema and parameters set in the e-invoice system.

4

Invoice Reference Number

Invoice contains only the invoice number and not the invoice reference number. There is no fixed format and conditions for invoice. Invoice is always assigned in sequence.

Under the e-invoice system, the e -invoice reference number is generated by the hash algorithm.

The main intention is to provide easy evaluation of e-invoices through unique IRN which is validated on the Central Registry and saved for future reference.

5

Dispatch of e-invoice

GST portal do not have any feature of validation and downloading of invoices.

Once the e-invoice is validated under e-invoice system it’s sent to the supplier to their registered e-mail ID.

6

Digital Signature

Only supplier’s digital signature is required on the invoice.

Validated e-invoices will be digitally signed by the IRP.

7

QR code

You could not verify invoice on the basis of QR Code.

When your invoice is validated its QR Code will be generated through IRP. Verification of invoices enable even without internet facility. It is mandatory for B2C transactions to have QR code.

8

Possibility of mistakes

Due to the manual functions possibility of errors is higher.

Least possibilities of errors since once the JSON of invoice details is uploaded and verified on the IRP, GSTR-1 of seller is updated. Further, e-Way bill details under Part A are also filled up, wherever applicable.

9

Amendment of invoice

You can Amend or Cancel invoice as amendment and cancellation facility available on GST portal and can be made as per law

E-invoice is only available for 24 hours with the IRP during which time the invoice can be fully cancelled. After that, the invoice can be amended as per GST laws on the GST portal.

10

Viewing the invoice

Invoice details entered could be viewed on the GST portal

Necessary invoice details can be made available on an app that can scan the QR code. Further, e-invoices are sent as an e-mail ID so the supplier can always save a copy under the e-invoicing system.

11

Verification of invoice

Not easy to verify the genuineness of an invoice during an inspection

Easy to verify the genuineness by scanning QR code and also checking of IRN

12

Possibility of search

Relatively higher possibility of a search by the department

Lower possibility of a search by the department since invoice details at the transaction level is already available with them.

 

E-invoice is applicable to those taxpayers who supply or export B2B, and who have a total annual turnover of more than Rs 500 crore, they have to generate e- invoice from October 1 2020 (e- invoice  also applies to those people , whose aggregate turnover is Rs 100 crore from January 1 2021.

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