In the latest development of the government’s initiative to shift to an e-invoicing model, the Finance Ministry has issued a notification dated May 10, 2023, stating that any GST-registered entity having turnover of more than Rs. 5 Crore in any financial year from 2017-18 will be required to comply with the e-invoice provisions with effect from 01st August 2023 i.e., they will be required to generate IRN/e-invoice against all B2B transactions.
How to activate the E-invoice system?
Given the fact that B2B invoices should preferably be declared to the GST authorities on a real-time basis, you must ensure that all details surrounding the parties and invoice items are correctly updated on the dashboard. Here MyGate dashboard is functioning as the Application Services Provider (ASP) to build a direct link between your society and the GST Suvidha Portal.
Step 1: API User Registration
For the MyGate dashboard to be used for e-Invoicing, you must register the society onto your GST portal as an API user. Once registered you’ll be provided with an API ID and password against your GSTIN that should be shared with MyGate to allow linkage with the GST portal.
Download the booklet to read more on how to register as an API user
Step 2: Feed in your details
As a society admin, it is mandatory for you to submit the following details under the Maintenance & Account Settings section:
- Society GSTIN
- Society Registered Name
- Society Address
- Society Pincode
- Society Location (city associated with the mentioned pincode)
Step 3: Ask Buyers to feed in the required information
The following details are mandatory for all the GST-registered houses and other debtors to submit under the Billing Details section:
- Debtor GSTIN
- Debtor Registered Owner Name
- Debtor Billing Address
- Debtor Pincode
- Debtor Location (city associated with the above pincode)
- Debtor Place of Supply for Goods or Services (to decide between CGST/IGST billing)
To ensure data sanctity for all B2B buyers, the following alert message will be displayed in case of any information discrepancy.
Step 4: Submit the Invoicing and Penalty Details
While the rates and quantities for the invoice items along with their GST rates and values are handled by the invoicing system directly – it is mandatory for you to provide the HSN/SAC codes. The latter should also be updated to the individual penalty settings associated with the billing templates.
Step 5: Activation of the E-Invoice system
The API User Id and password are essential for the activation of the E-invoice system. Entering these credentials into MyGate’s invoicing system is deemed as explicit consent to the ERP software to be able to raise E-Invoices for the seller.
We perform a test authentication call to the GST portal to verify the credentials before turning on the switch for E-Invoicing. Society must either be on a provisional penalty system or a subsequent invoice penalty system.
How to generate E-Invoices?
MyGate offers various entry points to generate member/non-member invoices to cater to the different use cases –
- If the society wants to generate invoices for multiple houses/non-members at once then the Group Invoice feature can be availed.
- If the society wants to generate an invoice for a particular house/non-member then the “Add Charge” feature is preferred. (Do not use this if the society works on bill plans or if there are multiple items on the concerned invoice)
- Societies levying provisional penalties onto their defaulting houses/non-members would find the ‘provision to tax conversion’ happening either automatically or through a tool on the dues summary page on the dashboard.
Group Invoice
Most of the billing occurs through the group invoicing section. Post configuration of a template, it can be used as a draft any number of times. The society can even enable automated periodic generation settings on a template to enable monthly/quarterly invoicing without any manual interference.
As billing flow has not changed in any way, society just has to be wary of adding any incorrect supporting information for the B2B houses involved in the generation process. For example, the non-GST items in the template have to have their proper HSN/SAC codes, given that each value is properly validated by the GST portal.
If there is incorrect information for a B2B house, the IRN and QR generation for that specific bill would fail. That one bill should be canceled and a fresh invoice must be generated for the house after data correction.
Add Charge
This is a quick invoicing tool presented on the dues page of all the houses/debtors. Due to its restricted nature, it is able to generate a single-item invoice whenever necessary.
Again, the usual billing flow has not changed in any way. Data-related cautiousness needs to be maintained.
Provisional Penalty Conversion
Receipt-based automatic conversion: The provisional penalty system in MyGate does not book income and attract GST liability until the penalty value is paid by the debtor. Upon payment, the penalty tax invoice is generated automatically alongside the receipt, and an IRN call is triggered by the software.
Bulk manual conversion: If a society deliberately wants to show the impact of the penalty on income, this is ideally done once a month or at the end of the financial year to keep simpler records. A conversion tool to address the same is offered on the dues summary page. This single-click operation can convert provisional entries of penalty into tax entries in bulk.
Validations to be kept in mind before generating any E-Invoice
- Ensure all B2B houses have their GST numbers configured along with address, pin code, location, POS, and registered owner names.
- GST number cannot be a dummy or incorrect value
- Pincode should belong to the same state as the GST number
- The location should be in plain text and match the pin code provided
- POS should exactly match the state code for service/goods supply
- The address cannot be more than 100 characters in length
- Ensure the seller has their GST number configured along with address, Pincode, location, and registered owner names. The other details mentioned in pt 1 apply here as well.
- If the seller and the buyer belong to the same state, an IGST invoice CANNOT be pushed and vice versa.
- HSN CANNOT be missing within any invoice item (whether the item attracts GST or not) or the penalty settings
- While dealing with the IGST houses or non-members, the society would need to create a separate template from the GST and non-GST registered parties.
Cancellation of E-Invoices
The GST authority mandates that the cancellation of a B2B E-Invoice/credit note must happen within 24 hours of its generation. Hence, we fetch the exact IRN generation time from the Suvidha Portal and allow cancellation until 23 hours 58 minutes to accommodate for safety.
Secondly, the ‘Delete’ button that appears on the latest batch generated also becomes non-functional in case the concerned batch contains an E-Invoice. This fail-safe ensures that no declared documents are accidentally hard-deleted and lost.
All invoices generated through group invoicing (whether manual or automated) sit under the group-generated charges in the invoice history. A ‘Cancel’ button is provided with each invoice batch that can be used to trigger the cancellation of the IRNs generated within that particular batch.
All invoices generated through add charge within the house/non-member dues page sit under the other charges in the invoice history. A ‘Cancel’ button is associated with each invoice that can be used to trigger the cancellation of the IRNs generated within the batch.
Reversal of E-Invoices using Credit Notes
When a transaction needs to be reversed, such as due to order cancellations, returns, or adjustments, you can reverse the original e-invoice using a credit note. The credit notes are required to be linked to the original e-invoice through its unique Invoice Reference Number(IRN). MyGate dashboard ensures this efficient linkage for the reversal to be properly connected to the original transaction for reconciliation purposes.
IRN Entries Tracker
With an IRN entries tracker, you can easily track and monitor the status and movement of e-invoices vis-a-vis IRN numbers. This enables better visibility into the invoice lifecycle, including invoice generation, submission, acceptance, and retrials in case of failure. It helps you stay organized and maintain control over your invoicing processes by offering various filters of flat, status, request & document types, etc.
Deactivation of the E-Invoicing System
You can reach out to the MyGate team for the deactivation of the E-Invoicing system. To ensure clarity around the previous IRN generations –
- The batch IDs will continue to carry the E-Invoice and generation pending labels.
- The aggregate counts of B2B houses and IRN generations would still be presented in the batch detail on the page.
- The invoices for the GST-registered houses would continue to display the IRN and QR codes.
The B2B label on the GST-registered house’s dues page will be disabled along with the various validations we do for any type of invoice generation.
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