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E-invoice
Small firms face a daunting task as e-invoicing kicks in from April 1

Small firms face a daunting task as e-invoicing kicks in from April 1

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Come April 1 and e-invoicing will be mandatory for business-to-business (B2B) transactions for taxpayers having a turnover of over Rs 50 crore from April 1, 2021.

At present, issuing electronic invoices is mandatory for businesses with a turnover of Rs 100 crore and more.

E-invoicing replaces the physical invoice and will soon replace the existing eway bill system, and taxpayers will not have to generate separate e-way bills.

The challenges

However, small firms may find it challenging to comply with the new norms.

Small businesses in small towns may face some difficulties with technology-led business processes.
A business needs to validate mandatory invoice information before uploading it to e-invoice systems to avoid rejections, otherwise, they may have to spend more time.

Firms will need to be vigilant while generating e-invoice as there are restrictions with the cancellation of the invoice, which must be carried out within the same day of the transaction.

How does e-invoicing work?

E-invoicing replaces the physical invoice and will soon replace the existing e-way bill system, and taxpayers will not have to generate separate e-way bills.

Under e-invoicing, taxpayers have to generate invoices on their internal systems (ERP/accounting/billing software) and then report them online to the Invoice Registration Portal (IRP).

The IRP will validate the information provided in the invoices and return the digitally signed e-invoices with a unique ‘Invoice Reference Number (IRN)’ along with a QR Code to the taxpayer.

Gaming the system

Small businesses use informal sales invoices to under-report turnover, which will be curbed by the move.

E-invoicing makes it difficult to show lower retail sales as the wholesale purchases are already reported to the government. The tax authorities can seek an explanation for the mismatch in wholesale buys and the final sales. If the purchases are higher and sales are lower, the taxman can ask the business to show inventory.

Benefits

The government expects e-invoicing to bring other major advantages, such as improving the payment cycle for industry and giving a boost to invoice-based lending to MSMEs.

Last month, the board had exempted non-banking financial companies, insurance companies, banks and financial institutions, and exports from

using dynamic quick response or QR codes on e-invoices issued to consumers. Exports have been exempted from the QR code requirement since such shipments are treated as business-to-business supplies. The board had notified the mandatory use of dynamic QR codes on such invoices issued by companies with an aggregate turnover of more than Rs 500 crore in March last year.

Source: Economic-Times.

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Government plans to include GST in UPI QR code

Government plans to include GST in UPI QR code

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The government is looking at upgrading the QR code for UPI in such a way that it can incorporate the GST component and show the same separately. This will enable the government to come out with fiscal incentives for payments that are made digitally.

The National Payments Corporation of India (NPCI) is working on UPI to enable this feature, CEO Dilip Asbe revealed. According to Asbe, when both ends of the payment are driven by software with information going to a cloud, there is no limit to the innovation that can take place. Additionally, information provided to the merchant and customer can grow manifold.

He said that the NPCI was working with banks and payment companies to create the capacity to handle a billion UPI transactions daily. “UPI has grown 250% in nine months. It is a journey where everyone has to keep investing,” he said.

Asbe was speaking at an event organised by Paytm to launch an upgraded version of its soundbox, which provides payment confirmation through audio and a screen. The payment company also launched a software application developed jointly with Visa which enables any NFC-equipped smartphone to accept contactless card payments from all card networks.

Speaking at the launch, Paytm founder Vijay Shekhar Sharma said that the company has sold 9 lakh point-of-sale (PoS) devices in 18 months and was targeting to upgrade 50 lakh merchants to accepting contactless payment over smartphones and IoT (internet of things, or net-connected) devices.

Sharma said that Paytm was already working on developing the dynamic QR that could incorporate GST. Speaking at the same event, Visa’s India chief T R Ramachandran said that with 25 billion IoT devices in the world, the scope for contactless payments has increased. He said that over 50 countries have increased their limit for contactless payments and the RBI has also revised the limit after analysing years of fraud data.

On the proposed licences for the new umbrella entities proposed by the RBI, Ramachandran said that the heterogeneous nature of the Indian market meant that one size does not fit all. He pointed out that there were under-penetrated segments in digital payments, such as B2B transactions and cross-border remittances. “It requires a thousand flowers to bloom to satisfy the appetite of India,” he said.

Source: Times-Of-India.

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CBIC clarifies Applicability of Dynamic QR Code on B2C Invoices

CBIC clarifies Applicability of Dynamic QR Code on B2C Invoices

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The Central Board of Indirect Taxes and Customs (CBIC) notified the clarification in respect of applicability of Dynamic Quick Response (QR) Code on B2C invoices and compliance of notification 14/2020- Central Tax dated 21st March 2020.

The Notification No. 14/2020-Central Tax, dated 21st March 2020 had been issued which requires Dynamic QR Code on B2C invoice issued by taxpayers having aggregate turnover more than 500 crore rupees, w.e.f. December 1, 2020.

Further, vide Notification No. 89/2020- Central Tax, dated 29th November 2020, penalty has been waived for non-compliance of the provisions of Notification No.14/2020 Central Tax for the period from 1st December, 2020 to 31st March, 2021, subject to the condition that the said person complies with the provisions of the said Notification from 01st April, 2021.

The Board has received various references from trade and industry seeking clarification on applicability of Dynamic QR Code on B2C (Registered person to Customer) invoices and compliance of Notification No. 14/2020-Central Tax, dated 21stMarch, 2020 as amended.

The issues have been examined and in order to ensure uniformity in the implementation of the provisions of the law across the field formations the Board, in the exercise of its powers conferred under section 168(1) of the CGST Act, 2017, clarified various issues.

Firstly, notification No 14/2020- Central Tax dated 21st March, 2020 is applicable to a tax invoice issued to an unregistered person by a registered person (B2C invoice) whose annual aggregate turnover exceeds Rs.500 Crores in any of the financial years from 2017-18 onwards.

However, the said notification is not applicable to an invoice issued in cases where the supplier of taxable service is an insurer or a banking company or a financial institution, including a non-banking financial company; a goods transport supplying services in relation to transportation of goods by road in a goods carriage; supplying passenger transportation service; agency supplying services by way of admission to exhibition of cinematography in films in multiplex screens and OIDAR supplies made by any registered person, who has obtained registration under section 14 of the IGST Act 2017, to an unregistered person.

As regards the supplies made for exports, though such supplies are made by a registered person to an unregistered person, however, as e-invoices are required to be issued in respect of supplies for exports, in terms of Notification no. 13/2020-Central Tax, dated 21st March 2020 treating them as Business to Business (B2B) supplies, Notification no. 14/2020- Central Tax, dated 21st March 2020 will not be applicable to them.

Secondly, CBIC clarified that Dynamic QR Code, in terms of Notification No. 14/2020-Central Tax, dated 21st March 2020 is required, inter-alia, to contain the information namely Supplier GSTIN number, Supplier UPI ID, Payee’s Bank A/C number, and IFSC, Invoice number & invoice date, Total Invoice Value and GST amount along with breakup i.e. CGST, SGST, IGST, CESS, etc. Further, a Dynamic QR Code should be such that it can be scanned to make a digital payment.

Thirdly, if the supplier has issued invoice having Dynamic QR Code for payment, the said invoice shall be deemed to have complied with Dynamic QR Code requirements.

In cases where the supplier, has digitally displayed the Dynamic QR Code and the customer pays for the invoice Using any mode like UPI, credit/ debit card or online banking or cash or combination of various modes of payment, with or without using Dynamic QR Code, and the supplier provides a cross reference of the payment (transaction id along with date, time and amount of payment, mode of payment like UPI, Credit card, Debit card, online banking etc.) on the invoice ; or in cash, without using Dynamic QR Code and the supplier provides a cross reference of the amount paid in cash , along with date of such payment on the invoice;

The said invoice shall be deemed to have complied with the requirement of having Dynamic QR Code.

Fourthly, if the cross reference of the payment made using such electronic modes of payment is made on the invoice, the invoice shall be deemed to comply with the requirement of Dynamic QR Code. However, if payment is made after generation / issuance of invoice, the supplier shall provide Dynamic QR Code on the invoice.

Fifthly, if cross reference of the payment received either through electronic mode or through cash or combination thereof is made on the invoice, then the invoice would be deemed to have complied with the requirement of Dynamic QR Code.

In cases other than pre-paid supply i.e. where payment is made after generation / issuance of invoice, the supplier shall provide Dynamic QR Code on the invoice.

Lastly, the provisions of the notification shall apply to each supplier/registered person separately, if such person is liable to issue invoices with Dynamic QR Code for B2C supplies as per the said notification.

In case, the supplier is making supply through the E-commerce portal or application, and the said supplier gives cross-references of the payment received in respect of the said supply on the invoice, then such invoices would be deemed to have complied with the requirements of the Dynamic QR Code. In cases other than pre-paid supply i.e. where payment is made after generation/issuance of the invoice, the supplier shall provide a Dynamic QR Code on the invoice.

Source: Taxscan.

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E-invoice
GST: CBIC notifies Schema for E-Invoice, SEZ units are excluded from E-Invoicing

GST: CBIC notifies Schema for E-Invoice, SEZ units are excluded from E-Invoicing

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The Central Board of Indirect Taxes and Customs ( CBIC ) on Thursday notified the Schema for E-Invoice for implementing e-invoicing, a form of electronically-authenticated invoices, from October 1 only for businesses with a turnover of Rs 500 crore or more under GST.

The Government empowered under Rule 48(4) of the Central Goods and Services Tax Rules, 2017, on the recommendations of the Council, amended the Notification No.13/2020-Central Tax, dated the 21st March, 2020, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), vide number G.S.R. 196(E), dated the 21st March, 2020.

In the said notification, in the first paragraph, before the words “those referred to in sub-rules”, the words “a Special Economic Zone unit and” shall be inserted.

Further, for the words “one hundred crore rupees”, the words “five hundred crore rupees” shall be substituted.

As per the earlier notification, a certain class of registered persons (insurance company, banking company, financial institution, non-banking financial institution, GTA, passenger transportation service etc.) to be exempted from issuing e-invoices or capturing dynamic QR code. The Notification said that “an invoice issued by a registered person, whose aggregate turnover in a financial year exceeds five hundred crore rupees, other than those referred to in sub-rules (2), (3), (4) and (4A) of rule 54 of said rules, and registered person referred to in section 14 of the Integrated Goods and Services Tax Act, 2017, to an unregistered person (hereinafter referred to as B2C invoice), shall have Dynamic Quick Response (QR) code: Provided that where such registered person makes a Dynamic Quick Response (QR) code available to the recipient through a digital display, such B2C invoice issued by such registered person containing cross-reference of the payment using a Dynamic Quick Response (QR) code, shall be deemed to be having Quick Response (QR) code.”

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https://www.taxscan.in/preview/?previews=1gArKZxhrGvwLMSqbvth-I1Hi9SDPtsWS

Source: TaxScan.

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GST: Government bets massive on tech to ensure e-way bill does not bring back inspector raj

GST: Government bets massive on tech to ensure e-way bill does not bring back inspector raj

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E-way bill : GST

The proposed e-way bill for moving goods within the country would rely heavily on technology, employing RFID chips and QR codes, to ensure that monitoring of goods movement does not bring back inspector raj and slow down goods traffic on highways, officials said.

After the launch of the goods and services tax (GST) on July 1, the movement of commercial goods had got speeded up as states abolished entry check posts.

Under the new tax regime, a document called e-way bill, or electronic way bill, is required to transport any good worth more than Rs 50,000. The e-way bill is proposed as a permit of sorts in electronic format, which will have details of the goods carried on a vehicle. The industry has been apprehensive that such a document will revive inspector raj, undermining the gains achieved by the abolition of check posts.


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“Effort is to have high technology interface,” said a government official, adding that it would ensure that all data regarding an e-way bill is captured on it. Having it embedded on RFID chip or a QR code will help in checking these in a non-intrusive manner without holding up a vehicle. “These would be checked with hand-held devices or RFID chip readers,” the official said.

A group of officers from state and union finance ministry will work on the tech and design of e-way bill, the person said. According to the proposed framework, GST Network will generate e-way bills that will remain valid for one to 15 days, depending on the transport distance. One-day permit will be for a distance up to 100 km while a 15-day permit will allow more than 1,000 km transit, as per the proposed law. A tax officer can intercept any conveyance to verify the e-way bill or the physical goods for all inter-state and intra-state movement of goods.

Rules governing the e-way bill have not yet been approved by the GST Council and are expected to be taken up when it meets next month on August 5.

Express Industry Council of India (EICI), which represents small and large express delivery service companies engaged in domestic and international door to door transport services of parcels and documents, had expressed concerns about it, saying it could prove a logistical challenge.

Source :  ET