How to Generate an E-Invoice and IRN: Step-by-Step Guide

Learning how to generate an e-invoice and IRN is essential once your business crosses the e-invoicing threshold. Under GST e-invoicing, you do not create invoices on a government portal. You create them in your own accounting or ERP system, then report the invoice data to an Invoice Registration Portal (IRP), which validates it, assigns a unique Invoice Reference Number (IRN), digitally signs it and returns a QR code. Only an invoice with a valid IRN is a valid tax invoice for covered businesses. This guide explains applicability, the step-by-step process, timelines, and the errors that cause rejections. If you need a readiness checklist rather than the process, our earlier e-invoicing readiness checklist covers preparation.

Who must generate e-invoices

E-invoicing applies to registered persons whose aggregate turnover in any financial year from 2017-18 onwards has exceeded ₹5 crore. Once you cross the threshold in any year, e-invoicing applies from the following year and continues even if turnover later falls. Aggregate turnover is computed on a PAN basis across all states.

Exempt entities

• SEZ units (SEZ developers are not exempt).
• Insurers, banking companies, financial institutions and NBFCs.
• Goods transport agencies supplying transport of goods by road.
• Suppliers of passenger transport services.
• Suppliers of admission to exhibition of films in multiplexes.
• Government departments and local authorities.

Exempt entities should keep a declaration on their invoices or records explaining why e-invoicing does not apply.

Which documents and supplies are covered

Covered	Not covered
Tax invoices for B2B supplies	B2C invoices (separate dynamic QR rules apply to very large businesses)
Credit notes and debit notes for B2B supplies	Bills of supply
Exports, with or without payment of IGST	Delivery challans
Supplies to SEZ, with or without payment	Imports (bills of entry)
Deemed exports	Self-invoices for RCM purchases from unregistered persons
B2B supplies on which recipient pays under reverse charge	Receipt and refund vouchers

How the e-invoicing flow works

1. Create the invoice in your system with all mandatory fields in the e-invoice schema (INV-01): supplier and buyer GSTINs, document type, number and date, item-wise HSN, quantity, unit, taxable value, rates and tax, place of supply and totals.
2. Generate the JSON in the prescribed schema. ERP and accounting systems typically do this automatically.
3. Upload to an IRP. Several IRPs are authorised, including those run by NIC and private providers. Upload is through the IRP's web portal, offline tool, API, or through your ERP's integration.
4. IRP validation. The IRP checks GSTINs, duplicate invoice numbers, HSN validity, value calculations and schema compliance.
5. IRN generation. The IRP generates a 64-character IRN, a hash based on the supplier GSTIN, financial year, document type and document number. The same document number cannot be registered twice in a year.
6. Signing and QR code. The IRP digitally signs the invoice and returns the signed JSON with the IRN, acknowledgement number and date, and a QR code containing key details.
7. Print or share the invoice with the QR code. The buyer can verify it using the government verification app.
8. Auto-flow to GSTR-1 and e-way bill. Data flows to your GSTR-1 and, if transport details are included, an e-way bill can be generated along with the IRN.

Step by step on the IRP web portal (for low volumes)

1. Register on the IRP using your GSTIN and create a username. Multi-factor authentication is now required.
2. Choose to generate a new IRN through the web form, or upload a JSON prepared by the offline utility.
3. Enter document details, buyer details, item lines and totals.
4. Submit and wait for validation results.
5. Download the signed invoice and QR code and attach the QR to your printed invoice.

For more than a handful of invoices per day, direct integration from your ERP is faster and less error-prone, because the invoice data is not typed twice.

The 30-day reporting rule

Taxpayers with aggregate annual turnover of ₹10 crore and above cannot report an invoice or credit or debit note to the IRP more than 30 days after the document date. The IRP rejects late uploads, and without an IRN the document is not a valid invoice for an e-invoicing taxpayer.

Example: A Coimbatore company with turnover of ₹12 crore issues an invoice dated 1 October. It must obtain the IRN by 31 October. If staff create the invoice in the ERP but forget to upload it, the invoice cannot be registered after that date, and the company will need to issue a fresh, correctly dated invoice and manage the consequences with its customer and advisor. A daily exception report of unregistered invoices prevents this.

Worked example: what the IRP validates

A Surat textile trader prepares a B2B invoice: taxable value ₹2,40,000, buyer in Rajasthan, 5% GST on fabric. The IRP checks:

Check	Expected value
Supplier and buyer GSTINs active	Both active on the portal
Place of supply	Rajasthan (08), different from Gujarat (24)
Tax type	IGST, because the supply is inter-state
IGST amount	5% of ₹2,40,000 = ₹12,000
Invoice total	₹2,52,000
HSN valid in master	Fabric heading in chapters 50 to 60
Document number unique	Not already registered this financial year

If the trader had charged CGST and SGST, the IRP would reject the invoice because tax type does not match the place of supply. Fix such issues in the source system so they do not recur.

Cancelling and amending e-invoices

• Cancellation: an IRN can be cancelled on the IRP only within 24 hours of generation, and only in full. Partial cancellation is not possible.
• After 24 hours: issue a credit note (which itself needs an IRN) or amend the details in GSTR-1, depending on the error.
• Reuse of numbers: a cancelled invoice number cannot be reused for a new IRN in the same financial year.
• E-way bill: if an e-way bill is linked, cancel it first before cancelling the IRN.

Common rejection errors and fixes

Error	Fix
Duplicate IRN	The document number was already registered; fetch the existing IRN instead of creating a new one
Invalid HSN	Correct the item master; see our guide on finding HSN codes
Buyer GSTIN inactive or cancelled	Verify with the customer; treat as B2C if they are no longer registered
Tax type does not match place of supply	Fix the place of supply logic in the billing system
Total value mismatch	Check rounding and line-level calculations
Document date older than 30 days	For businesses at ₹10 crore and above, the window has closed; consult your CA

Preparing for e-invoicing when you cross ₹5 crore

Businesses usually discover they are covered only when a customer asks for an IRN. A better approach is to monitor turnover and prepare a quarter ahead:

1. Track aggregate turnover across all GSTINs under your PAN every month. When the year's figure approaches ₹5 crore, plan for e-invoicing from the next financial year.
2. Clean the masters. E-invoice validation is strict. Customer GSTINs, state codes, PIN codes, HSN codes and units of measure must be correct, because each one is validated.
3. Choose an integration route: direct API from your ERP, a GST Suvidha Provider, or the IRP's offline tool for low volumes.
4. Test on the sandbox. IRPs provide test environments where you can submit sample invoices and confirm that your JSON passes validation.
5. Update invoice templates to print the IRN, acknowledgement number and QR code.
6. Train staff on the 24-hour cancellation window and the 30-day rule if your turnover is ₹10 crore or more.
7. Go live on 1 April and monitor failed uploads daily for the first month.

How e-invoicing changes your monthly GST work

Once e-invoicing is running, several downstream tasks become easier. B2B invoices, export invoices and credit notes are auto-populated in GSTR-1, so you review rather than upload. E-way bills can be generated from the IRN without retyping consignment details. Your customers see your invoices in their IMS and GSTR-2B quickly, which reduces payment disputes. The trade-off is discipline: invoices must be right at the time of creation, because corrections after 24 hours need credit notes. Monthly GSTR-1 review should include a reconciliation of the IRP data with the sales register to catch invoices that were raised in the books but never registered.

Daily e-invoicing checklist

1. All B2B invoices, credit notes and debit notes issued today have an IRN.
2. No invoices are pending upload beyond a set number of days.
3. Failed uploads are reviewed and corrected the same day.
4. Printed or emailed invoices carry the QR code.
5. Cancellations, if any, happen within 24 hours.
6. E-way bills are generated for goods movement where required; see how to generate an e-way bill.

How Fininvo helps

Fininvo ERP prepares the e-invoice JSON in the prescribed format, submits it to the IRP, retrieves the IRN and QR code and embeds them in the invoice PDF. Signed invoices are stored, and e-invoice data flows into GSTR-1. Explore invoicing, tax compliance and pricing.

General information, not tax advice. Thresholds and IRP rules change by notification; check the e-invoice portal and consult your CA.

Frequently Asked Questions

Is e-invoicing required for B2C invoices?

No. E-invoicing with IRN applies to B2B supplies, exports and similar documents. Very large businesses notified for B2C dynamic QR codes must print a payment QR code on B2C invoices instead.

What if my turnover was above ₹5 crore once but is lower now?

E-invoicing continues to apply. The test is whether aggregate turnover exceeded the threshold in any financial year from 2017-18, not only the latest year.

Can I edit an e-invoice after IRN is generated?

No. You can cancel it within 24 hours or issue a credit or debit note later. Some details can be amended in GSTR-1, but the IRN record itself cannot be edited.

Does e-invoicing replace GSTR-1?

No. E-invoice data auto-populates GSTR-1, but you still review and file GSTR-1 yourself, and add supplies not covered by e-invoicing.

Do I still need an e-way bill?

Yes, for movement of goods above the value threshold. However, you can generate the e-way bill along with the IRN by including transport details, which saves time.