Benefits of E-invoicing for MSMEs:
- Reduced compliance burden - the system is integrated with one another which will ultimately reduce the burden of compliance.
- E-invoicing helps MSMEs to secure loans faster - E-invoicing has played a major role for MSMEs as they can secure loans faster and easily and the reason behind this is that banks can score them based on compliance rating and sanction them.
- Seamless Account Reconciliation - E-invoice can help to minimize mismatch errors & data entry errors. It also allows to track the invoices created by the supplier in real time and so the data will be available at the transactional level which will reduce audits by the tax authorities.
- Easy Tracking of E-invoices - It is easy to track the e-invoice in real time. You will know when it is received and submitted. You will also know the status of the invoice - approved, denied, pending or seen by the client.
- Reducing Fake and Duplicate invoices - The non-digitalising of invoices has increased in fake / duplicate invoices which results in tax evasion.
Benefits of e-invoicing in a post pandemic world:
- SAVE TIME & MONEY - E-invoicing significantly reduces costs associated with printing, storage, processing, and delivery of paper invoices. There is also minimum human intervention in creating, tallying, etc & increased automation in the process. Automation and the use of technology saves effort, time and money and leads to faster transactions and fewer errors.
- One time Reporting of B2B invoices - The details are auto-populated to the GSTR-1 Return which reduces the manual reporting process.
- Benefits to the Taxpayers - The implementation of e-invoicing under GST is beneficial for taxpayers in various ways:
- Seamless generation of E-way Bill with e-invoices
- Real time tracking of e-invoices prepared by the suppliers
- Better account reconciliation
- Fewer inputs and rejected invoices.
- E-way Bill & E-invoicing - Generation of E-way bill is now linked with E-invoices. Invoice Registration Portal is used to generate E-way Bills as well. The data is sent to the IRP and IRN or E-way Bill number or both is/are issued.
- Reduced Human Errors - With e-invoicing, the information directly gets populated in the billing softwares and reduces human errors. With fewer human errors, payments are made quickly and less time is spent chasing up.
Future of e-invoicing in India
E-invoicing in India: Benefits for the Government
- Controlled tax evasion.
- Real-time sharing of data to the nearest point of sale.
- Enhanced invoice reliability.
- Enabling a better exchange of information.
E-invoicing in India: Benefits for the business
- Reduced government intervention
- Annulment of e-way bills.
- Withdrawal of tax credit mechanism requirement
- Lowering of commercial disputes.