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GST - What's in an Invoice? A surprising lot

Note: This article is a little different from our usual articles which usually tries to simplify tax, accounting and finance jargon. This one contains reference to a lot of provisions. Feel free to skip this article if you don't want to deal with such jargon. Our usual posts will continue. Stay tuned for those.


Background

Generally, invoice is a commercial instrument issued by the seller to buyer against supply of goods or services. It’s an important document under GST. It not only evidences supply of goods or services but is also essential for the determination of time of supply. GST law has mandated for a registered person to claim input tax credit only on the basis of the Invoice issued u/s 31 of CGST and debit note issued u/s 34 of CGST Act. Therefore, an invoice, among other documents, is required to be issued for every form of supply such as sale, exchange, transfer, barter, lease, rental, license or disposal.

Tax invoice u/s 31 of CGST Act 2017 can only be issued by the registered person as Section 32 of CGST Act 2017 specially prohibits collection of tax by unregistered person.


Invoice under GST


This section mandates issue of invoice or bill of supply for every supply of goods or services. However, an invoice or a bill of supply need not be issued by Registered person if the value of the supply is less than Rs. 200/-, subject to specified conditions.

Note: It also include a Revised Tax invoice issued under this act.


Timeline for the issue of Invoice:

Important point to consider: An invoice or a bill of supply need not be issued if the value of the supply is less than Rs.200/-, subject to specified conditions.


Particulars of Tax invoice

Tax Invoice to be issued by Registered person must contain following particulars as required by rule 46 of CGST rule:-

  • Name, address and GSTN of the Supplier

  • Invoice number and date of issue

  • Name, address and GSTIN or UIN of the recipient- if registered

  • Name and address of the recipient and the address of delivery, along with the name of State and its code, if such recipient is un-registered and where the value of taxable supply is fifty thousand rupees or more

  • HSN code

  • Description of goods or services

  • Quantity in case of goods and unit or Unique Quantity Code thereof

  • Total value of supply of goods or services

  • Taxable value of supply of goods or services taking into account discount or abatement

  • rate of tax (central tax, State tax, integrated tax, Union territory tax or cess)

  • amount of tax charged (central tax, State tax, integrated tax, Union territory tax or cess)

  • place of supply along with the name of State, in case of a supply in the course of inter-State trade or commerce

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

  • whether the tax is payable on reverse charge basis

  • the word “Revised Tax invoice” or “Supplementary invoice” to be indicated prominently, wherever applicable along original invoice no and date.

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

Team Galactic - If this is too much information for you to read, we've created a sample invoice format for you to download -

GST INVOICE Format
.xlsx
Download XLSX • 26KB

Some invoice details are not required for the following suppliers particulars are exempt for specified supplier from the above provision as below:

In case of export, the tax invoice shall carry en endorsement

- “Supply meant for export/Supply to SEZ or SEZ Developer on payment of IGST” or

- “Supply meant for export /Supply to SEZ or SEZ Developer under Bond without payment of IGST”.

However invoice must contain the name of the country of destination in lieu of the State name & State code.


Manner of issue of Tax invoice

The tax invoice must be prepared in triplicate for goods, and in duplicate for services. Each copy of the tax invoice is required to be marked as follows:

Circumstances where Registered person cannot issue a tax invoice:

Where both taxable as well as exempted supply are effected to an Unregistered person by a Regd. Person, single ‘Invoice-cum- bill of supply’ instead of ‘tax invoice’ may be issued. {Rule 46A of CGST inserted vide N No.45/2017}.


Multiple series of invoices allowed under GST

It may be issued provided all the series of tax invoice are reported in Form GSTR-01.


HSN code in invoice

The Harmonised System of Nomenclature (HSN) code for goods or services that a class of registered persons shall be required to mention is as follows as per notification no 12/2017 – Central Tax dated 28th June, 2017:

*Annual turnover: Turnover in the State as defined in Section 2(112) of the Act, computed for the preceding financial year.


Special declaration

Special declaration containing the words “INPUT TAX CREDIT NOT ADMISSIBLE” to be made where any invoice has been issued in pursuance section 74/129/130 of CGST Act.


Discount

Discount provided before or at the time of supply must be reflected on the face of the tax invoice


Bill of Supply

A bill of supply is document which is issued in lieu of a tax invoices. It may be issued in following cases:

- where it is not mandatory for the supplier to issue an invoice, a bill of supply can be issued.

- In the case of supply of non-taxable goods

- Where GST is paid under composition scheme.


Contents of bill of supply:

  • Name, address and GSTN of the Supplier

  • Invoice number and date of issue

  • Name, address and GSTIN or UIN of the recipient- if registered

  • Description of goods and services

  • HSN code

  • Taxable value of supply of goods or services taking into account discount or abatement

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

Relaxation to issue Bill of supply under GST

If value of supply is less than Rs. 200 subject to condition that

(a) the recipient is not a registered person; and

(b) the recipient does not require such bill of supply,

and he shall issue a consolidated bill of supply for such supplies at the close of each da