Myths and facts about “E-invoicing“

Myths and facts about e-invoicing (Compiled by Cygnet GSP)

Myth 1

E-invoice will have to be generated through the GST portal.


The tax invoice will continue to be generated from the existing ERP system. It will only need to be registered on IRP.

Myth 2

E-invoicing is applicable to all.


Organisations with turnover exceeding ₹500 crores are mandatorily required to file e-invoicing. Those above ₹100 crores are required to follow from 1st January 2021 followed by a roll-out for all taxpayers w.e.f. 1st April 2021.

Myth 3

A new software/ERP system will be required for e-invoicing.


No new software will be required. Existing software will have to be geared up to implement additional E-invoicing features.

Here are the steps to create an e-invoice :

Step 1: 

Confirm the e-invoice schema using the GSTN’s offline utility or third-party application. The software should be capable of reading the prescribed language, which is JSON. JSON is a data interchangeable format that converts human-readable language into machine-readable language and vice versa.

Step 2: 

Upload the invoice information onto the IRP with the required parameters. This may be done directly by accessing the IRP or by using GSPs or third-party applications.

Step 3: 

Upon validity of the data received, IRP will digitally sign and add a QR code to the invoice. In case of an invalid result, an error code will be generated.

Step 4: 

IRP will then return the digitally signed invoice containing QR code. In case of an error, the error code will be sent back to the generator. Such erred invoice data will not get stored in the central registry

Step 5: 

At the same time of communicating with the generator, the signed e-invoice will be sent to GST portal and e-way bill portal. This signed e-invoice received by GST portal will get stored in the central registry.

Step 6: 

Once the e-invoice is generated, the information available on E-invoicing will get auto-populated in the e-way bill through NIC.

Cygnet GSP processed over 85,15,000 e-invoices in the first month itself which is 18.6% of the total e-invoices generated on the NIC portal.

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