E-Invoicing in Retail Trade


    E-invoicing is a growing trend in the retail trade industry, where it is used to streamline invoicing and payment processes, reduce errors, and increase efficiency. With the increasing adoption of digital payments and e-commerce in retail, e-invoicing has become necessary for businesses to stay competitive and meet customer expectations. 

    Implementing e-invoicing in the retail trade industry can also help businesses comply with regulatory requirements and reduce compliance burden. In this context, it is important for businesses in the retail trade industry to understand the benefits of e-invoicing and explore its implementation to stay ahead in the market.

    Compliance of E-Invoicing in Retail Trade

    According to the GST Act, any retailer in India with a turnover between Rs. 50 crores and Rs. 500 crores (or more) are required to comply with the following:

    1. Real-time E-invoice instead of a tax invoice (B2B, SEZ) 
    2. Real-time E-invoice – credit note/debit note (B2B, SEZ)
    3. Tax invoice (B2C)
    4. Bill of supply (B2B and B2C)
    5. Dynamic QR Code for entities more than Rs. 500 Crores
    6. E-way bill compliance against the transportation of goods
    7. Delivery Challan
    8. GST Returns (1, 3B, 9, 9C)
    9. ITC Reconciliation

    E-Invoicing Under Retail Trade

    According to Rule 48(4) of the CGST Rules, accounting software used to raise invoices based on purchases or sales is provided with e-invoicing software patches. In retail trade, invoices must be generated and presented to customers immediately after purchase, ensuring compliance with e-invoicing regulations and minimising errors. However, e-invoicing only applies to B2B and B2C transactions, allowing the government to monitor and prevent fraudulent invoices and ITC claims.

    An e-invoicing patch will be unavailable if the billing software has any issues. Some business owners manually create e-invoices after submitting standard tax invoices according to Rule 46. These e-invoices are not accessible to B2B clients, resulting in significant non-compliance.

    The main issue is that billing software, possibly a legacy or indigenous system, is used, and the entity’s internal IT or software team may lack the technical expertise to automate e-invoicing within their current framework.

    When suppliers apply the patch, existing billing systems can be customised. Alternatively, separate e-invoicing tools are developed to act as an intermediary between the billing software and the government portal and provide e-invoicing services.

    Significant Points for E-Invoicing

    In addition, the software should be able to distinguish between the following:

    E-way Bill Retailers

    If the value of the consignment is more than Rs. 50,000, an E-Way Bill is required to transport the goods. The taxable value plus the taxes is referred to as the consignment’s value, which excludes the exempted value of the supply.

    Documents to be carried for the transportation of goods are e-way bills mapped to the RFID of the conveyance or delivery challan, depending on which is applicable. 

    Problems and their Solution under E-way bills

    Taken by a B2C customer after being purchased at retailSince the enrolled supplier would not certify the delivery’s termination, EWB is not required.The tax would be applied based on the registered address.
    Taken by a consumer who is doing business with you from the storeTo expand EWB with regard to the e-invoice, either the supplier or the consumer. The application in SL No. 1 is disputed, making it impossible to claim that personal effects were utilised.
    Purchased at a store and shipped to a business serving consumers.Against the tax invoice/invoice-cum-bill of the supply, the supplier must raise EWB.
    Purchased from the shop and delivered to a business clientThe supplier will file an EWB for the e-invoice.
    Purchased at the store and shipped to a different address.To raise an EWB against an e-invoice, the supplier should view the transaction type as “Bill to Ship To.”
    Delivery from location 2 after purchasing location 1’s storeThe supplier is required to issue an electronic work order for the e-invoice and recognise the transaction as a bill from the ship from
    Purchase made at location 1 store, delivered from location 2, plus separate billing and shipping addressIn relation to the e-invoice, the supplier is to raise an EWB and recognise the transaction type as a mixture of 2 and 3
    The substitution of an older product with a more recent oneThe supplier will raise an EWB for a new product’s electronic invoicing. If the “used personal/household effect” is less than 50,000, an old product EWB may not be required.
    Purchased and asked to deliver after a specific deadlineSupplier to raise EWB concerning the initial delivery’s e-invoice.
    Purchased and requested for the delivery of various goods in three instalmentsThe supplier must provide EWB pertaining to the delivery challans. There must be an e-invoice link on the delivery challan. The first two movements must include a copy of the invoice, and the last instalment must include the original invoice.

    Effect of Non-Compliance

    The following actions may be taken if the owner of goods fails to pay the applicable tax and penalty: 


    Such compliances under GST are highly crucial in light of the strict penalties for non-compliance, the chance that customers won’t pay, and the effect on reputation and confidence. Because of the nature of retail trade activity, compliance and future growth will depend on instant preparedness and easy connection with their numerous software systems. 

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