The Indian Government has introduced legislation, mandating that all companies operating in India with more than Rs.500Cr Aggregate Turnover must register all their invoices (including export invoices) with the Government’s Invoice Registration Portal (IRP) before issuing the tax invoice to their customers.
The legislation requires that the Invoice Reference Number (IRN) and the Quick Response Code (QR), which are returned by the Invoice Registration Portal upon successful invoice registration, are present in the tax invoices that you issue to your customers.
This mandate applies to my company; what do I do now?
Tungsten Network portal will not allow you to provide the 64-digit code Invoice Reference Number (IRN) and QR code needed to submit a Legal Tax Invoice.
You have the following options:
Upgrade to an Integrated Supplier Account
If you already have arranged an automated service to register your invoices or are looking to do this in an automated way, you can upgrade your account and send the electronic information directly to Tungsten Network.
Integrated suppliers can send invoice data to Tungsten Network directly from their billing system in a fully automated manner and have the capability to raise additional documents via Tungsten Network, which are not available from the portal, such as ISD invoices. For this option, we need to understand your preferred connectivity method and the specifics of your invoice data.
OR
Tungsten is delighted to offer new services to help AR departments to automate the invoice clearance process with the IRP
Clearance Solution for Integrated AR departments
- The customer will send all the invoices that need processing in an XML File via their existing Tungsten connection
- Tungsten Network registers all invoices on the customer’s behalf with the Invoice Reporting Portal and handles any rejection back and forth before successful submission
- Tungsten Network will decrypt the file returned from the IRP and send back a complete JSON, XML or PDF file to the customer, including the QR code and Invoice Reference Number (option 1&2&3) that customer needs for legal tax invoicing (pdf with QR code)
- For end to end clearance and delivery you can opt for our Total AR solution
BUT
As a Webform customer, if you choose not to upgrade to an Integrated Solution account or use Tungsten as your clearance provider starting October 1st we will no longer be able to create the legal Tax invoice on your behalf.
For those who’ve not completed the Integration upgrade by October 1st, there will be a discretionary period for you to attach your legal Tax Invoice, including IRN and QR code, along with your webform submission whilst you go through the upgrade.
How do I get ready for the change?
You need to inform us as soon as possible if this change applies to your company. Please contact Tungsten Support and raise a ticket and a representative will be able to discuss your options, and work with you to commence the Integrated Service Solution upgrade.
Starting from October 1st, 2020, certain suppliers are liable to collect TCS at 0.075%** on the amount exceeding Rs 50L billed to a buyer for the sale of goods during the financial year. In other words: if the amount received from a buyer during the financial year exceeds Rs 50L, then the amounts in excess of Rs 50L will be taxed at a higher rate of +0.075%. Note that the amount of GST should be included in the value for calculation of the TCS amount.
Am I impacted by this change?
If your company’s turnover (or total sales) was Rs 10Cr or higher in the previous financial year the requirement to collect TCS will apply to you.
To which goods does the requirement apply?
The requirement applies to ANY GOODS sold, except:
- If goods are exported from India to any country outside India.
- If buyer is liable to deduct TDS (Tax Deducted at Source) under Income Tax Act.
- If the goods sold are already covered under sub sections (1), (1C), (1F) and (1G) of section 206C of the Income Tax Act
How do you apply TCS to your Tungsten invoices?
The tax code for Tax Collected at Source is already available in the Tungsten portal as TCS. If you need to apply TCS to an invoice, please create an additional line by selecting 'Special charge' as your line type, and from there you can select TCS from the tax dropdown. The invoice total will now be updated so that It includes TCS.
How do I get ready for the change?
You can start adding TCS in Tungsten Network portal without any further action.
**: note that the current rate of 0.075% applies from 01.10.2020 until 31.03.2021. After this period, the Government may decide to return to the original TCS rate of 0.1%
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