What is Invoice Reference Number (IRN) in GST

What is Invoice Reference Number (IRN) in GST

IRN known as Invoice Reference Number is a unique number allotted by Government to tag and identify every valid e-invoice generated in India, being implemented from 1st October 2020. The e-invoicing system has been introduced to create a standard for all e-invoices generated. In this article, we will be dealing with the following aspects about Invoice Reference Number (IRN) in an e-invoice:

What is an Invoice Reference Number (IRN)?

The Invoice Reference Number (IRN) is a unique number (also known as hash) generated by the Invoice Registration Portal (IRP) using a hash generation algorithm, under the e-invoicing system. For every document such as an invoice or debit or credit note to be submitted on the Invoice Regsitration Portal, a 64 character invoice reference number shall be generated. This number shall be unique for every invoice raised in a financial year by a GSTIN in the entire GST system. 

Further, every invoice being issued by supplier to his recipient must contain the IRN. The tax officers can verify the genuineness of the transaction using invoice reference number through the central portal as well as an offline app. It will, in turn, help them check the invoice even where internet may not be accessible.   

What is the hash generation algorithm in IRN?

A hash generation algorithm is a function that converts a message or a string consisting of characters (alphabets + numbers + certain special characters) into a series of numbers such that the resulting numbers cannot indicate the original message. The GSTN will prescribe this algorithm as part of the e-invoicing standard.  

What are the parameters used to generate Invoice Reference Number (IRN)?

IRN is generated by converting characters into numbers (also called ‘hash’) using a hash generation algorithm. This algorithm will be applied to the following three parameters:

  • Supplier GSTIN
  • Supplier’s document number. For example, invoice number
  • The financial year in ‘YYYY-YY’ format. For example 2019-20.

When is the Invoice Reference Number (IRN) generated?

The IRN generation will be required at the time of issuing the invoice or credit note or debit note by the seller. However, the taxpayers having more than Rs.500 crores turnover have been given a grace period of 30 days from 1st October 2020 for generating an IRN. This grace period is valid for the invoices issued between 1st October 2020 to 31st October 2020.

The invoices under the e-invoicing system will continue to be prepared using any software that a business entity uses to generate invoices. However, they will have to conform to the prescribed standard and parameters. 

The entity can choose either of the following two options to generate IRN: 

Option 1: Using the Excel offline tool.   

Option 2: Through API integration directly with the e-invoice portal/IRP or via GST Suvidha Provider.

Note: In both cases, the IRP will perform a de-duplication check where the IRN so generated will be checked against the Central Registry of the GST System (containing all generated/uploaded IRN) to ensure that all IRN remain unique. 

Frequently Asked Questions

Can I regenerate a new IRN for an invoice against which IRN was already generated? 

No, it is not possible as only a unique invoice will be accepted on the invoice registration portal. For this purpose, the e-invoice system does a check with the Central Registry of the GST system for any duplication. 

How long will the IRN be stored on the government portal? 

The IRN which is generated on the e-invoice system shall be made available to the taxpayer for upto 24 hours 

What are the prerequisites to generate an IRN?

Following are the prerequisites: 

  • The user must be GST registered taxpayer, having login created on GST portal and e-invoice system or e-way bill portal.
  • Invoice or debit note or credit note details must be at hand.
  • Depending upon the mode of generation, such user must have bulk IRN generator offline tool downloaded on the system or must have created API user ID and set the password on the e-invoice system.
Will both invoice number and IRN required to be mentioned on the e-invoice? 
Yes, both are mandatory fields as per the e-invoice schema notified by the CBIC on 30th July 2020.  

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