How & When to raise a GST Invoice –Explaining all Practical Scenarios

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A GST Invoice is one of the most important documents in any transaction as it evidences the supply of goods or services and also mentions all relevant details regarding such supplies. Moreover, the GST Invoice is also a major indicator of the time of supply.

A registered person under GST cannot claim the benefit of Input Tax Credit unless he is in the possession of a GST Invoice or a debit note. Due to these reasons – it is very important to raise a correct GST Invoice as any error or mistake in the invoice can adversely impact both the buyer and the seller.

When should a GST Invoice be raise?

The time of raising the GST Invoice would depend on the nature of supply i.e. whether it is a supply of goods or a supply of service.

In case of supply of taxable goods, a registered person shall issue an invoice at any of the following mentioned time

  1. Before the removal of Goods, or
  2. After the removal of Goods, or
  3. Delivery of Goods, or
  4. Making them available to the Recipient.

In case of supply of taxable services, a registered person shall issue the GST Invoice at any of the following mentioned time

  1. Before the Provision of Service, or
  2. Within 30 days from the provision of service

Manner of Issuing GST Invoice

In case of Supply of Goods, the GST Invoice shall be prepared in triplicate in case of supply of services in the following manner:-

  1. The original copy being marked as Original for Recipient
  2. The duplicate copy being marked as Duplicate for Transporter
  3. The triplicate copy being marked as Triplicate for Supplier

In case of supply of services, the GST Invoice shall be prepared in duplicate in case of supply of services in the following manner:-

  1. The original copy being marked as Original for Recipient
  2. The duplicate copy being marked as Duplicate for Supplier

The serial number of invoices issued during a month shall be mentioned in the GSTR-1 which is furnished electronically.

16 Things to be mentioned on the GST Invoice

There is no format prescribed by the Govt for a GST Invoice. The supplier of the goods or services can create a GST Invoice himself as per his convenience.

However, the Govt has mandated mentioning the following contents in the GST Invoice (only applicable fields are to be filled)

  1. Name, Address & GSTIN No. of the supplier
  2. A consecutive serial number, in one or multiple series, containing alphabets or numerals or special characters like 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 supplies is Rs. 50,000 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 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 the discount or abatement (if any).
  11. Rate of Tax (CGST, SGST, IGST, UTGST).
  12. Amount of Tax Charged in respect of taxable goods or services (CGST, SGST, IGST, UTGST).
  13. Place of supply along with the name of State, in case of 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 Reverse Charge basis.
  16. Signature or Digital Signature of the supplier of his authorised representative.

A draft sample GST Invoice has been released by the Govt. and can be downloaded from this link – https://www.aces.gov.in/Documents/draft-formats-under-invoice-rules.pdf

Bill of Supply

A Bill of supply is required to be raised instead of a GST Invoice, if a registered person is dealing only in exempted supplies or is availing the benefit of the composition scheme.

A Bill of supply shall be issued by the supplier containing the following details:-

  1. Name, Address and GSTIN of Supplier
  2. A consecutive serial number, in one or multiple series, containing alphabets or numerals or special characters like 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 SAC Code of Services
  6. Description of Goods or Services of both
  7. Value of Goods or Services or both taking into account discount or abatement, if any
  8. Signature or Digital Signature of the supplier or his authorised representative.

HSN Code of Goods or Services

  • HSN/ SAC Code is required to be mentioned only if the turnover of the supplier is more than Rs. 1.5 Crores in the preceding Financial Year.
  • 2 Digit HSN Code is required to be mentioned if the annual turnover of the preceding Financial Year is more than Rs. 1.5 Crores but less than Rs. 5 Crores.
  • 4 Digit HSN Code is required to be mentioned if the annual turnover of the preceeding financial year is more than Rs. 5 Crores.

Receipt of Advance Payment

Whenever a registered person receives an advance payment with respect to any supply of goods or services or both, he has to issue a receipt voucher for the same.

A receipt voucher needs to contain the following particulars

  1. Name, address and GSTIN of supplier
  2. A consecutive serial number, in one or multiple series, containing alphabets or numerals or special characters like 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. Description of Goods
  6. Amount of Advance Taken
  7. Rate of Tax (CGST, SGST, IGST, UTGST).
  8. Amount of Tax Charged in respect of taxable goods or services (CGST, SGST, IGST, UTGST).
  9. Place of supply along with the name of State, in case of supply in the course of inter-state trade or commerce.
  10. Whether the tax is payable on reverse charge basis
  11. Signature or Digital Signature of the supplier or his authorised representative.

It has also been provided in the invoice rules that if at the time of receipt of advance,

  1. The rate of tax is not determinable, the tax may be paid @ 18%
  2. The nature of supply is not determinable; the same shall be treated as Inter-state supply.

GST Invoice under Special Circumstances

Invoice under Reverse Charge Basis

In case the provisions of Reverse Charge under GST are applicable, the recipient shall raise an invoice on self. Invoice shall be raised on a consolidated basis for all payments made during the day on which GST is levied under Reverse Charge.

The registered person shall also issue a payment voucher in respect of such supplies at the time of making payment to the supplier.

Invoice in case of continuous supply of Goods

In case of continuous supply of goods, where successive statements of accounts or successive payments are involved, the invoice shall be issued before or at the time of each such statement is issued or, as the case may be each such payment is received.

Invoice in case of continuous supply of Services

In case of continuous supply of services, where:

  • The due date of payment is ascertainable from the contract – the invoice shall be issued on or before the due date of payment.
  • The due date of payment is not ascertainable from the contract – the invoice shall be issued before or at the time when the supplier of service receives the payment.
  • The payment is linked to the completion of an event, the invoice shall be issued on or before the date of completion of the event.

Invoice in case of Export of Goods or Services

In case of Export of Goods or Services, the Invoice shall carry one of the following endorsements as the case maybe i.e.

  1. Supply meant for Export on Payment of Integrated GST
  2. Supply meant for Export under Bond or Letter of Undertaking without Payment of Integrated GST.

The following details shall also be mentioned on such an invoice

  1. Name of the Recipient
  2. Address of Delivery
  3. Name of the Country of Destination

Transportation of Goods without Invoice

In the following cases, it is permissible for the consignor to issue a delivery challan in lieu of invoice at the time of removal of goods:-

  1. Supply of Liquid Gas where the quantity at the time of removal from the place of business of the supplier is not known.
  2. Transportation of Goods for Job Work.
  3. Transportation of Goods for reasons other than by way of supply.

The delivery challan shall also be prepared in triplicate i.e. for the Consignee, Transporter and the Consignor.

Goods Transported in Semi-knocked Down or Completely Knocked Down Condition

Where the goods are being transported in a semi-knocked down or completely knocked down condition:-

  1. The supplier shall issue the complete invoice before the dispatch of the 1st
  2. The supplier shall issue a delivery challan for each of the subsequent consignments, giving reference of the invoice.
  3. Each consignment shall be accompanied by copies of the corresponding delivery challan along with a duly certified copy of the invoice.
  4. The original copy of the invoice shall be sent along with the last consignment.

GST Credit and Debit Note

Credit Note

In cases where GST Invoice has been issued for a supply and subsequently it is found that the value or tax charged in that invoice is more than what is actually payable/ chargeable or where the recipient has returned the goods, the supplier can issue a credit note to the recipient.

A registered person who issues such credit note has to declare the details of such a credit note in the GST Return for the month during which such credit note has been issued but not later than September following the end of the financial year in which such supply was made or the date of furnishing of the relevant annual return, whichever is earlier.

The GST liability of the registered person would be adjusted in accordance with the credit note issued, however no reduction in output tax liability of the supplier shall be permitted, if the incidence of tax and interest on such supply has been passed on to any other person.

Debit Note

In cases where the GST Invoice has been issued for a supply and subsequently it is found that the value or tax charged in that invoice is less than what is actually payable/ chargeable, the supplier can issue a debit note to the recipient.

Any registered person who issues a debit note in relation to a supply of goods or services or both, shall declare the details of such debit note in the return for the month during which such debit note has been issued.

Apart from mentioning the above mentioned contents in the Revised GST Invoice, the words “Revised Invoice” should also be indicated prominently.

Other Relevant Details about GST Invoice

  1. In case where the supply of services ceases under a contract before the completion of the supply, the invoice shall be issued at the time when the supply ceases and such invoice shall be issued to the extent of the supply made before cessation.
  2. In case where the goods being sent or taken on approval for sale or return are removed before the supply takes place, the invoice shall be issued before or at the time of supply or 6 months from the date of removal, whichever is earlier.
  3. The invoice may either be generated electronically through Computer or manually by hand.

Karan is CA by Qualification with the rare distinction of being awarded All India Rank 22. He is also the founder of this website and loves to help people with their Tax Queries.