How is GST e-invoicing beneficial to accounting software?
With the advent of the Internet, the billing system has evolved significantly. Under the new e-invoicing software, all business-to-business invoices are electronically authenticated by GSTN for further use on the common GST portal. The invoicing billing software issues an identification number against every bill by the IRP, short for Invoice Registration Portal. As e-invoicing software usage has grown, the accounting field has also incorporated it.
The E-invoicing software requires you to submit an invoice on the GST portal to generate multiple reports with a one-time upload. Accounting software uses this portal to benefit taxpayers and let them perform their e-invoicing activities. Along with this, this online accounting software allows users to migrate all their data safely with the support of the new e-invoicing software.
Features of a Good Online Accounting Software
- The GST invoicing software helps you keep track of all entries of a particular invoice.
- The e-invoicing accounting software lets the user directly integrate with the GST portal.
- E-invoicing software is easily accessible through different operating systems, such as web browsers and mobile phones.
- It is very cost-effective.
- It can reduce the risk of fraud and promote trust & reliability.
The Current Invoicing System
At present, businesses generate their invoices through different tools and upload the final invoice manually for the GSTR-1 return instead of using single accounting software. After uploading the invoice, the user can see the information in GSTR-2A. On the other hand, transporters have to generate separate e-way bills. However, for businesses, the procedure is a little less cumbersome. They can use the accounting software with tools for GST integration and e-invoicing.
For businesses, the e-invoicing system allows the user to import the invoice through excel or API integration. The entered data effortlessly flows through the entire GST portal.
Benefit of e-invoicing to Businesses
The major role of e-invoicing is to benefit the business and automate the process with the help of accounting software. A few of the advantages of using e-invoicing through GSTN are below.
- E-invoicing helps fill a significant gap for GST in data reconciliation, leading to a major reduction in mismatch errors.
- There is a reduction in data entry errors as the e-invoices generated by multiple software can be read by this accounting software, offering integration with the GST portal.
- This GST accounting software allows all the authorities to track the invoices the supplier has prepared.
- Another benefit of e-invoicing is that it lets you generate tax credit reports.
- This software disables the possibility of surveys and audits by the tax authorities as all the information about your business is available at the transaction level.
- Backward integration and automation of the process can make filing tax returns effortless.
- It auto-populates the required details of the invoice in multiple returns.
E-invoicing Curbs Tax Evasion
Another major benefit of e-invoicing accounting software is that it helps in proper tax compilation and curbs tax evasion in the following ways:
- As the accounting software generates an e-invoice through the GST portal, the tax authorities get complete access to all the transactions happening in real-time.
- Another benefit of generating invoices before a transaction is that there are fewer chances of manipulating the invoice now.
- There cannot be any fake tax credit because invoices are integrated with GSTIN every time they are generated through the GST portal.
Everything has two sides to the coin. If the e-invoicing accounting software has advantages, it also has some disadvantages that you shall not ignore. On one hand, it helps reduce tax evasion and fraud in B2C invoices.
Because it only supports B2B invoices. Another disadvantage is that it does not store invoices for more than 24 hours. Therefore, study all about the new Invoicing Software for Small businesses or large one before adopting it.