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Corporate and Individual Taxation

Everything you need to know about GST Invoice

The significance of invoice has increased with the advent of the GST. Could Matching Mechanism be the reason?
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An invoice can be termed as an instrument which is issued for sale of goods or services. It is issued by the supplier to the recipient. The invoice identifies the parties involved in the transaction and the description of the goods sold or services supplied.

Under the Matching Mechanism, the outward supplies of the Supplier must match with the inward supplies of the recipient. Matching is essential to claim input tax credit.

Table of Contents:

Format of GST Invoice

Section 2(66) of Central Goods & Services Tax Act, 2017 mentions tax invoice as “invoice” or “tax invoice” means the tax invoice referred to in section 31”. Section 31 along with other rules provides requisites of the tax invoice in accordance with the provisions of the Act. The Act does not prescribe a particular format but it does provide necessary requirements which must be contained in a tax invoice. The invoice may be manual or electronic. Sample GST invoice[1] for creating GST invoice.

Who can Raise a Tax Invoice?

A registered taxable person can raise a tax invoice. It is necessary to issue a tax invoice unless exempted under the provisions of the Act

Tax invoice under Section 31 of the CGST Act, 2017 includes:

a. A document issued by an input service distributor

GST invoice format

b. Any supplementary invoice

c. A revised invoice

A tax invoice shall include any revised invoice issued by the supplier in respect of a supply made earlier.

File: GST Return Online

Mandatory Contents of GST Invoice

Section 31 of the CGST Act, 2017 mentions the mandatory contents of the invoice. No particular format has been prescribed but there are essentials which must be contained in the invoice. The invoices could be manual or electronic.

Following are mandatory ingredients: 

  • Name, address and GSTIN of the supplier

  • A consecutive serial number not exceeding 16 digits, unique for an FY

  • Date of issue

  • If the recipient is registered, name, address and GSTIN of the Recipient

  • Description of goods/services along with HSN Code

  • Value of supply after effecting the necessary discounts

  • Rate of tax (include description i.e., CGST/SGST/IGST)

  • Amount of tax

  • Value of invoice

  • Place of supply

  • Address of delivery where the same is different from the place of supply

  • Forward charge or reverse charge

  • Signature of supplier/authorised representative

HSN Code- Number of Digits

HSN stands for Harmonized System Nomenclature. It is used to classify goods and services. It is to be mentioned along with items in the invoice. The HSN code of every time is composed of 8 Digits. The number of digits have to be mentioned in accordance with the notification issued by the Government.

The Government has specified number of digits of HSN Code vide Notification No. 12/2017 – CGST and 5/2017 – IGST dated 28th June 2017.

Sr. No.

Particulars

Code

        1.

Turnover of up to Rupees One Crore Fifty Lakhs

0

        2.

Turnover of more than Rupees One Crore Fifty Lakhs and up to Rupees Five Crores

2

       3. 

Turnover of more than Rupees Five Crores

4

4.

In case of exports/imports

8

Rules to Create GST Invoice

Rule 46 deals with the requirements of a tax invoice. It must contain the following particulars:

  1. Name, address and GSTIN of the supplier;

  2. A consecutive serial number, in one or multiple series, containing alphabets or numerals or special characters hyphen or dash and slash symbolised as “-” and “/” respectively, and any combination thereof, unique for a financial year;

  3. Date of its issue;

  4. Name, address and GSTIN or UIN, if registered, of the recipient;

  5. Name and address of the recipient and the address of delivery, along with the name of State and its code, if such recipient is unregistered and where the value of taxable supply is fifty thousand rupees or more;

  6. HSN code of goods or Accounting Code of services;

  7. Description of goods or services;

  8. quantity in case of goods and unit or Unique Quantity Code thereof;

  9. Total value of supply of goods or services or both;

  10. Taxable value of supply of goods or services or both taking into account discount or abatement, if any;

  11. Rate of tax (central tax, State tax, integrated tax, Union territory tax or cess);

  12. amount of tax charged in respect of taxable goods or services (central tax, State tax, integrated tax, Union territory tax or cess);

  13. Place of supply along with the name of State, in case of a supply in the course of inter-State trade or commerce;

  14. Address of delivery where the same is different from the place of supply;

  15. whether the tax is payable on a reverse charge basis; and

  16. Signature or digital signature of the supplier or his authorized representative:

Tax Invoice in case of Export

Where the goods are to be exported, there are specific conditions for issuing of a tax invoice.

In case of exports of goods or services, the invoice shall carry an endorsement “Supply meant for export on payment of IGST” or “Supply meant for export under bond or letter of undertaking without payment of IGST”, as the case may be, 

And must contain the following details:

  1. Name and address of the recipient;

  2. Address of delivery;

  3. Name of the country of destination; and

  4. Number and date of application for removal of goods for export:

Exceptions to Issuing of Tax Invoice

The issuance of a tax invoice is a mandatory task. However, it is exempted in the following conditions.

Provided also that a registered person may not issue a tax invoice in accordance with the provisions of clause (b) of sub-section (3) of section 31 subject to the following conditions, namely:-

  1. The recipient is not a registered person, and

  2. The recipient does not require such invoice and shall issue a consolidated tax invoice for such supplies at the close of each day in respect of all such supplies

  3. Value of goods and services supplied is less than 200 rupees

Time – Limit to Create GST Invoice

The Act prescribes a time limit for issuing of the tax invoice. The time limit varies in accordance with conditions. Rule 47 deals with time limit for issuing an invoice. 

  1. Supply of Goods

In case of the supply of taxable goods, the invoice must be issued before or at the time of removal of goods for supply, where the supply involves the movement of goods and before or at the time of delivery to the recipient where the supply doesn’t involve the movement of the goods. 

The term “removal of goods” is defined in Section 2 (96) of the CGST Act, 2017 as “removal’’ in relation to goods, means— 

(a) despatch of the goods for delivery by the supplier thereof or by any other person acting on behalf of such supplier; or 

(b) collection of the goods by the recipient thereof or by any other person acting on behalf of such recipient;

  1. Supply of Services

In case of the supply of taxable services, the invoice must be issued before or after the provision of service but maximum within 30 days of the provision of service, and this period is 45 days in case of BFSI companies.

  1. Continuous Supply of Goods

In case there is a continuous supply of goods, and where successive Statement of Accounts (SOA) are issued or where successive payments are involved, the invoice must be issued before or at the time of issue of each such SOA / the receipt of each such payment.

In case there is a continuous supply of services

  1. Where the due date of payment is ascertainable from the contract - the invoice must be issued on or before such due date

  2. Where the due date of payment is not ascertainable - the invoice must be issued on/before receipt of such payment by the supplier

  3. Where the payment is linked to the completion of the event -  the invoice must be issued on/before the completion of that event

Copies of GST Invoice

  • In case of the supply of goods, three copies of the invoice must be issued:

  1. Original for Recipient 

  2. Duplicate for Transporter 

  3. Triplicate for Supplier

  • In case of the supply of services, two copies of an invoice must be issued:

  1. Original for Recipient  

  2. Duplicate for Supplier

Other Types of GST Invoice

Revised Tax Invoice (Rule 53)

Revised invoice is an invoice which is issued against the invoices already issued during the period beginning with the effective date of registration till the date of issuance of the certificate of registration. A revised tax invoice referred to in section 31 and credit or debit notes referred to in section 34 shall contain the following particulars, namely:-

  1. The word “Revised Invoice”, wherever applicable, indicated prominently;

  2. Name, address and Goods and Services Tax Identification Number of the supplier;

  3. Nature of the document;

  4. A consecutive serial number not exceeding sixteen characters, in one or multiple series, containing alphabets or numerals or special characters hyphen or dash and slash symbolised as “-” and “/” respectively, and any combination thereof, unique for a financial year; 

  5. Date of issue of the document;

  6. Name, address and Goods and Services Tax Identification Number or Unique Identity Number, if registered, of the recipient;

  7. Name and address of the recipient and the address of delivery, along with the name of State and its code, if such recipient is unregistered;

  8. Serial number and date of the corresponding tax invoice or, as the case may be, bill of supply; 

  9. Value of taxable supply of goods or services, rate of tax and the amount of the tax credited or, as the case may be, debited to the recipient; and

  10. Signature or digital signature of the supplier or his authorised representative.

Other requirements: -

Revised Invoice is issued against taxable supplies made during the period starting from the effective date of registration till the date of issuance of the certificate of registration. The registered person may issue a consolidated revised tax invoice in respect of all taxable supplies made to a recipient who is not registered under the Act during such period.

Further, in the case of inter-State supplies, where the value of a supply does not exceed two lakh and fifty thousand rupees, a consolidated revised invoice may be issued separately in respect of all the recipients located in a State, who are not registered under the Act.

Further Read: GST Registration and Filing Returns

Bill of Supply (Rule 49)

Bill of Supply is issued by a registered supplier in the following cases:

  1. Supply of exempted goods or services

  2. Supplier is paying tax under composition scheme

A bill of supply must be containing the following details:-

  1. Name, address and GSTIN of the supplier;

  2. A consecutive serial number, in one or multiple series, containing alphabets or numerals or special characters - hyphen or dash and slash symbolised as “-” and “/”respectively, and any combination thereof, unique for a financial year;

  3. Date of its issue;

  4. Name, address and GSTIN or UIN, if registered, of the recipient;

  5. HSN Code of goods or Accounting Code for services;

  6. Description of goods or services or both;

  7. Value of supply of goods or services or both taking into account discount or abatement, if any; and

  8. Signature or digital signature of the supplier or his authorized representative.

Delivery Challan (Rule 55)

A delivery challan should be issued instead of an invoice in the following situations:

  1. Supply of liquid gas where the quantity at the time of removal from the place of business of the supplier

  2. Is not known

  3. Transportation of goods for job work

  4. Transportation of goods for reasons other than by way of supply, or

  5. Such other supplies as may be notified by the Board.

Special Tax Invoice (Rule 54)

Tax Invoice in Special cases is dealt with under Rule 54. An ISD invoice or, as the case may be, an ISD credit note issued by an Input Service Distributor shall contain the following details:-

  1. Name, address and GSTIN of the Input Service Distributor;

  2. A consecutive serial number containing alphabets or numerals or special characters hyphen or dash and slash symbolised as, “-”, “/”, respectively, and any combination thereof, unique for a financial year;

  3. Date of its issue;

  4. Name, address and GSTIN of the recipient to whom the credit is distributed

  5.  Amount of the credit distributed; and

  6. Signature or digital signature of the Input Service Distributor or his authorized representative:

Other requirements: -

  1. Where the supplier of taxable service is an insurer or a banking company or a financial institution, including a non-banking financial company, the said supplier may issue a consolidated tax invoice or any other document in lieu thereof, by whatever name called, for the supply of services made during a month at the end of the month, whether or not serially numbered, and whether or not containing the address of the recipient of taxable service but containing other information as prescribed under rule 46

  2. Where the supplier of taxable service is a goods transport agency supplying services in relation to transportation of goods by road in a goods carriage, the said supplier shall issue a tax invoice or any other document in lieu thereof, by whatever name called, containing the gross weight of the consignment, name of the consignor and the consignee, registration number of goods carriage in which the goods are transported, details of goods transported, details of place of origin and destination, GSTIN of the person liable for paying tax whether as consignor, consignee or goods transport agency, and also containing other information as prescribed under rule 46

  3. Where the supplier of taxable service is supplying passenger transportation service, a tax invoice shall include ticket in any form, by whatever name called, whether or not serially numbered, and whether or not containing the address of the recipient of service but containing other information as prescribed under rule 46

 

External Links:

[1] Sample GST invoice form: To create an invoice under GST rules.

 

Written by: Utkarsh Sharma

Reviewed by:
Prachi Darji
Associate - Legal, MyAdvo Techserve Pvt. Ltd.
Published on 28th Jun, 2019
340 views

Prachi Darji is an expert corporate lawyer, currently associated with MyAdvo as a legal advisor. She has finished B.Sc, LLB(Hons.) from Gujarat National Law University. She has worked with many renowned firms like Blue Bird Foundation in Baroda, Human Rights and Legal Aid Centre in Surat, Kaleeswaram Raj and Associates in Kerala, Nanavati Associates in Surat, Advocate Dr. Anmol Rattan Sidhu in Chandigarh.

She has successfully completed courses on Management of NGO conducted by Mr. Srinath Tirumale, World Scout Bureau, Geneva and International Humanitarian Law conducted by Mr. Rajendra Gunputh, University of Mauritius.
LinkedIn: https://www.linkedin.com/in/prachi-darji-539345118

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