As business compliance rapidly evolves, India’s Goods and Services Tax (GST) mandated electronic invoices are an integral component. Over time, this system was implemented to simplify business operations while increasing tax compliance; beginning October 1st, 2020, electronic invoicing became mandatory for companies with over INR 500 crore turnover during 2019-2020. This blog discusses how SAP systems help companies meet this requirement, including manual and automated solutions. In conclusion, SAP systems are reliable for addressing the electronic invoicing mandate.
Table of Contents
Overview of SAP’s E-Invoice Solution
SAP has developed two leading solutions to comply with GST electronic invoice requirements: an automated solution and a manual option. Both options can be tailored to specific system needs and capabilities.
- Automated Solutions: With this option, SAP’s Cloud Integration Platform (CPI) enables seamless integration between SAP ECC or S/4HANA systems and the IRP, automatically creating Invoice reference Numbers (IRNs) and direct submission into its online portal.
- Manual Solutions: With manual solutions, an offline JSON Request file must be manually uploaded onto an IRP system. This approach may suit companies not ready for full automation or those requiring special assistance or manual support.
Solution Approach and Implementation
Automated Solution:
Configuration:
Begin by implementing the latest SAP notes regarding electronic invoicing. Configuring involves connecting the SAP system and IRP through approved GST Suvidha Providers (GSPs). An essential reference point is SAP Note 2884058, which gives detailed instructions for implementation.
Master Data Setting up:
Master Data Related to Invoices ensures all master data related to invoices has been correctly configured within SAP. This includes accurate details regarding suppliers and customers and transactional data needed for invoicing.
QR Code Generation:
SAP manages QR code creation through e-invoicing, so it maintains an up-to-date system with patches to meet changing QR code requirements.
Connecting ECC/S4 via CPI > GSP > NIC: Configuring SOAManager correctly enables certificate-based authentication and connecting to SAP Cloud Platform Integration (SCPI). A step-by-step implementation guide can be found in Note 2884058 of SAP Note.
Manual Solution:
For manual configuration of an e-invoicing system, referring to SAP Note 2872365 helps provide directions. Specifically, creating processes that generate JSON documents directly to an IRP is key here. After uploading your JSON demand file, responses should be handled manually by changing the status of the electronic invoice in SAP and linking an IRN directly with an invoice number from the outset.
Common Issues and Queries on Automated E-invoicing
Automated Solution:
Error Handling: Issues relating to automated e-invoicing could be traced to a wrong setup or outdated software. for more details, refer to SAP Note 2894627 for a complete FAQ and troubleshooting instructions.
IRN Generation Issues: Problems related to the creation of IRN could be due to incorrect data or system issues. For comprehensive guidelines and troubleshooting tips, you can always refer to SAP Note 2958243 and 2948482. We’re here to support you.
Manual Solution:
Response Handling: This section provides guidance on the manual processes used to read and store IRNs, as well as QR codes or digital signatures, to ensure the best outcomes. You can refer to KBA 2973923’s FAQs for help.
Key Points to Keep in Mind for Implementation
ECC/S4 Configuration: Proper setup for automating e-document creation is crucial; please refer to SAP Note 2908256 and 2908488 for more detailed information.
- Integrating E-Way Bills: If your company needs to generate electronic invoices and e-way bills, ensure the appropriate settings have been implemented according to SAP Note 2958861 and the E-Invoicing Implementation Manual.IRN to Inward Invoices To successfully invoice the inward invoice, both MIRO’s IRN field and its configurations must be set correctly; please refer to SAP notes 2958243 and 29,48482 for guidance.
Contingency and cancellation: Review the guidelines for canceling IRNs and creating contingencies when invoices are made offline, using SAP Notifications 2966960, 2971204, and 2971247 as more specific instructions.
Master Data Setup and QR Code Generation
- Master Data: When updating the J_1IEXCDEFN table with condition types, use BADI BADI_EDOCUMENT_IN_EINV to capture additional data if required. For legal names and details regarding export ports, please refer to SAP Note 2921570/2921673.
QR Code: The QR code should be printed using encoded data. Please refer to SAP Note 2482854 for guidance regarding XML file logic used when printing forms and verify that your QR codes have been displayed correctly.
Connecting SAP Systems
SOAManager and iFlow Deployment: Configure SOAManager and set up the necessary iFlows in the SAP Cloud Platform Integration (SCPI). Follow the guidance in SAP Note 1361688 and the implementation guide provided by GSP for successful deployment.
Downloading Payloads: For downloading e-invoice payloads and managing JSON request/response files, refer to SAP Note 2966494.
Conclusion:
Implementing the GST e-invoice system in SAP requires careful planning and execution. By following the guidelines and utilizing the resources provided in SAP Notes and FAQs, businesses can ensure a smooth transition to the e-invoicing system. This shift enhances compliance and improves operational efficiency and accuracy in invoicing.
For further assistance with issues related to e-invoicing, raise incidents in the relevant SAP components: CA-GTF-CSC-EDO-IN-IV for automated processes and XX-CSC-IN-SD for manual processes. Embracing the GST e-invoice system can transform your invoicing process, making it more streamlined and efficient, ultimately benefiting your business’s bottom line.
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FAQ On E-Invoices
What is GST E-Invoicing?
GST E-Invoicing is a system where B2B invoices are reported to the Invoice Registration Portal and verified by the GST Network, generating a unique Invoice Reference Number and signed QR code for each invoice.
Who is required to generate E-Invoices?
E-invoicing is now mandatory for businesses with a turnover exceeding Rs. 5 crore, with the initial requirement being for businesses with an aggregate turnover exceeding Rs. 500 crore.
How do I generate an E-Invoice?
Businesses upload invoice details to IRP, which validates the information and returns an e-invoice with a unique IRN and a QR code.
