IRAS has announced on 15 April 2024 its InvoiceNow initiative for GST-registered businesses. GST registered business will be required to transmit their e-invoice data to IRAS in phases, starting in November 2025 and will be implemented progressively as follows:
  • From 1 May 2025, for voluntary early adoption by GST-registered businesses, as a soft launch.
  • From 1 November 2025, for newly incorporated companies that register for GST voluntarily.
  • From 1 April 2026, for all new voluntary GST-registrants.
The initiative is part of the government’s efforts to increase the adoption of digital invoicing and improve tax compliance. GST-registered businesses will need to use InvoiceNow solutions to transmit their invoice data directly to IRAS, which will help streamline their compliance processes and reduce data preparation efforts. Additionally, businesses can enjoy faster GST refunds and receive alerts for wrongful GST charges from non-GST registered suppliers.
For SME owners who are registered GST businesses, there are a few specific changes in business process, billing, invoicing, and accounting that GST-registered businesses need to implement in response to the IRAS InvoiceNow initiative:
Business Process Changes:
  1. Digital Invoicing: Businesses must adopt digital invoicing using InvoiceNow solutions, such as Peppol or other IRAS-approved solutions. The current front office transactional (TP) invoicing processing or Enterprise Resource Processing systems (ERP,CRM) etc would need to be interfaced at API level to the IRAS InvoiceNow Exchange. Invoicing issuance must be correct at the point it is issued as it is directly interfaced into the API and be ready for upload into IRAS InvoiceNow exchange.
  2. Automated Data Transmission: Invoice data must be transmitted directly to IRAS, eliminating manual data entry. This will mean that any invoicing adjustment after the issuance will require an adjustment realtime and upload to the TP. The window period of off-TP adjustments from invoices issuance to the capture into the backend accounting systems will no longer be available. All adjustments will require a structured and more cumbersome adjustments subsequent to invoice issuance.
  3. Real-time Tracking: Businesses have to implement the tracking of the status of their invoices and payments in real-time.
Billing and Invoicing Changes:
  1. Standardised GST tax compliant Invoice Format: Businesses must use a standardised GST tax compliant invoice format, including specific fields and data elements. The offline manual invoicing amendments out of TP or backend accounting systems are no longer available. The invoicing data at front end TP must be the same as that goes into the backend accounting system.
  2. Unique Invoice Reference Number: Each invoice must have a unique reference number.
  3. Digital Signature: Invoices must be digitally signed and all amendments must be effected into both the front end TP and backend accounting systems.
Accounting Changes:
  1. Automated GST Calculation: All GST amounts will be calculated automatically based on the front end TP system invoice data transmitted to IRAS via InvoiceNow exchange.
  2. Enhanced Data Analytics: Businesses can will have to implement and maintain a real-time system to track data and insights on their invoices, payments, and for GST compliance.