Every business entity/taxpayer having an annual turnover exceeding INR 500 crore (to be calculated at the PAN level) during the financial year will have to comply with the e-Invoicing guidelines mandatorily from 1 October 2020. These notified taxpayers will have to generate e-Invoices for all their supplies/sales.
Implementing the new e-Invoicing system can be challenging with the continuous changes in the Application Programming Interfaces (API) and the requirements of law. That is why, we bring to you ‘autoTax’, a platform designed to equip your team for hassle-free adoption of this new system directly through your SAP ERP.
In this article, you will be able to understand:
With autoTax, E-Way Bills and E-Invoices can be generated in the foreground or background within the ERP. Furthermore, real-time GST reconciliation ensures accurate ITC utilisation.
SAP is the leader in the ERP industry and has found great success among large enterprises.
Recognising the extensive use of SAP, autoTax connecter for SAP enables direct communication between the ERP and Government servers.
We support integrations through the Application Programming Interface (API) and FTP/SFTP.
From the users perspective, the workflow when auto tax integrates with SAP (ECC/HANA) is as simple as it is seen below.
Business users can continue to follow their usual practice of generating the invoice since the process can be executed in the background.
So, what is happening at the backend?
For the successful generation of e-invoice, there is a flow of communication needed between SAP and Government portals.
- To support this, we deploy autoTax connector, an ABAP programme, in the SAP. This connector is configured for all tax transactions required to be reported as per the e-Invoicing guidelines through T-Code mapping in SD/FI/MM modules. For instance, whenever VF01 in SD (Sales and Distribution) is triggered, the programme will extract the invoice data and convert it into JSON. This JSON file will be then sent to the IRP, and synchronously, the response (IRN, QR code, signed JSON) will be received. VF03 will enable printing of QR code on tax documents, formatted through smart forms or adobe forms.
- The details entered in the regular (accounting) invoice needs to match the schema notified by the government. Once these details are validated by the Invoice Registration Portal (IRP), an Invoice Reference Number (IRN) will be assigned to the invoice, and a Quick Response (QR) code will be generated and sent back to the user. The other data points received here are:
- Signed JSON
- Acknowledgement number
- IRN will not be generated for invoices that have identical invoice parameters (supplier GSTIN, invoice Number/ODN, document type, financial period, etc.). SAP users can be assured that duplicate documents/invoices will not be submitted to the IRP.
- The responses received from the IRP will be stored in the standard e-Invoicing table already provided by SAP so that it can be used in the future for reporting and other purposes.
- Taxpayers should install suggested packages for e-invoicing. As per SAP updates (OSS notes) 2482854, 2030263, 2029589 and 2029824 need to be installed for now.
SAP may bring new OSS for e-Invoicing. The list is only indicative, not conclusive.
There is no additional hardware required. The only network configurations needed here are:
- Install SSL certificate: To encrypt the data during the transition, our server’s SSL certificate will have to be installed in the SAP ERP.
- Whitelist IP: To ensure seamless API communication over the internet, our static IP needs to be whitelisted on the user’s firewall.
The next steps will be taken care of by the integration experts.
Step 1: Integrate autoTax API through pre-existing SAP middleware or RFC process with SAP
To develop the API channel, system integrators can use the company’s existing SAP middleware (SAP – PI, CPI, PO if available) or create this channel through an RFC process.
Step 2: Document Configuration
The Government has asked the users to segregate their billing type into three different parameters:
- Sub Type
- Sub Supply
- Document Type
Since these parameters are not available in the Sales and Distribution (SD) module of SAP, autoTax provides a flexible config setting to load the data required. This configuration connects all SAP standard workflows (to post an invoice) with the specific requirements* of the government portal. Any number of billing types already developed in SAP can be maintained in this setting, and e-Invoices can be generated.
*The Government has notified an e-Invoicing schema which has to be followed for the generation of e-Invoices. All the details required in the schema are currently not available within SAP. This is where this configuration will come to play.
Once the configuration is complete, all that the users have to ensure is to fill in the details prompted on the screen while creating invoices. These details are as basic as:
Our experts will explain the elements of the e-Invoice schema during the on-boarding process.
Note: The integration process remains the same for SAP ECC and SAP HANA platforms.
autoTax supports two modes of generating e-Invoices The preferred mode will have to be communicated by the SAP user to the system integrator in advance (at the installation stage) to ensure that the right configurations are done. However, in the user cockpit available within SAP, these changes can be made, whenever required, by the users as well.
- Automatic e-Invoice generation Post it, and you get it!
- No additional steps are needed here. That means – the minute a user creates a regular invoice in SAP, e-Invoice gets generated in real-time.
- Here, once the invoice is added, autoTax will immediately pick up the required data like supplier details, invoice details, line items (as required by the schema), invoice header fields, etc. and send the details over the API channel to the IRP. The Government system verifies the details, and the response is returned through the same API channel within seconds. The generated e-Invoice is stored in the cockpit within SAP.
- In case the e-invoice doesn’t get generated for any reason, the posting of the invoice as an accounting entry in SAP will not get affected. Furthermore, the details of the invoices for which e-Invoice is not generated will separately be available in the custom cockpit. The reasons for failure will also be visible. This will help the user fix the issues and regenerate the e-Invoice.
- To ensure compliances are not compromised, validation checks are in place. That means the user cannot print a regular invoice without generating a valid e-Invoice.
When a print command is given through SAP, autoTax in the background will check if an e-Invoice is generated for it or not. If not, the printing will not be allowed.
- e-Invoice generation through the custom cockpit – Batch processing
- The user can generate e-invoices at his/her convenience through the autoTax custom cockpit.
- This cockpit is extensively customisable. That means the user can select:
- Which category of invoices should be placed in the custom cockpit? Example: All invoices, Invoices based on company code, Invoices based on the billing date, etc. Once this parameter is set, as and when the user wants to generate the e-Invoice, he/she will merely have to visit the custom cockpit in SAP and generate the e-Invoice. Bulk selection is also possible here. The rest of the process remains the same.
- Which email IDs within the company can have access to generate the invoice, or approve it? This is to ensure that the access controls and authorisations are in place.
The cockpit gives the complete view of the e-Invoices generated and the available features. Users can:
- Generate e-Invoice/s
- View generated e-Invoice/s
- View failed invoice/s
- Print e-Invoice/s
- Cancel e-Invoice/s
Note: Bulk actions are possible here.
Apart from the customisations mentioned above, autoTax provides a few custom tables to SAP users.
- Unit of measure: The current unit of measure (2 character code) in SAP differs from the Governments unit of measure (3 character code). The pre-filled table within autoTax maps the codes between SAP and GSTN in the backend.
- Port codes: In the port table, port codes and addresses can be maintained.
- MIS reports: All the e-Invoice related data available in the SAP can be downloaded as an excel file for future reference.
As elaborated above, autoTax aims to cover the user end-to-end during the e-Invoicing process.
- The entire process has been streamlined to ensure there is no change in the functioning of the business.
- This solution will take care of all types of documents that need an e-Invoice to be generated.
- Access control checks are placed to assure security.
- Validation controls are installed to make sure there is 100% compliance.
- Integrations are done in such a way that the regular working of the ERP is not hampered.
- The cockpit is user friendly with the APIs working in the backend. That means users will be able to complete the e-Invoicing process by themselves with no direct interactions with the GSP or Government portals.
- The SAP screen remains the single point of interaction for the users. All functionalities are available within SAP.
- When an e-Invoice is cancelled through the cockpit, the billing document in SAP is automatically cancelled. This is to make sure that the same invoice is not presented again to the IRP.
DID YOU KNOW?
Masters India is a certified GSP for the SAP e-Invoicing solution.
autoTax 2.0 of Masters India has been certified to offer integrations through SAP Cloud Platform Integration Services. Masters India through autoTax can undertake:
- Deployment of integration flow through SAP CPI web frontend
- Integration of GSP solution with ‘SAP DCS – GST reporting’ solution via CPI content
- Integration of GSP solution with ‘SAP DCS – GST e-Way bill’ solution via CPI content
- Integration of GSP solution with ‘SAP DCS – GST e-Invoice’ solution via CPI content
We understand that financial data is sensitive. To ensure that the user’s privacy is maintained and the data is secured, Masters India has taken cautious steps. Some of these are:
- The systems are annually audited as per the ISO 27001 guidelines.
- The data shared is encrypted throughout the process. That means the data is ciphered not only during the transition but also when it is at rest.
- We work on the Virtual Private Cloud of AWS.
- All the actions taken through autoTax are ‘User Permission’ based.