In my present write up, I have tried to support you in preparation of prompt GST Invoice which is now everyday seen document. The GST system has replaced the invoices such as tax invoice, excise invoice and retail invoices with one general GST tax invoice that has to be issued for all sales of goods and services, as a GST registered dealer, you are obligated to provide GST invoices that are compliant with GST rules and regulations for all supply of goods and services.

1. Invoicing under GST – when should an invoice be issued?

In the case of Supply of goods:

Before or at the time of – removal of goods, if supply involves movement of goods;

Delivery of goods to the recipient, if supply does not require movement of goods.

In the case of Supply of services:

Within 30 days from the original date of supply;

*If a supplier is a bank or a financial institution, the invoice should be done within 45 days of the supply of service.

Note: If a person paying tax on reverse charge receives goods or services from an unregistered supplier, the receiver needs to issue an invoice on the date of receipt of the respective goods or services

1. What is a GST Invoice ?

An invoice or a bill is a list of goods sent or services provided, along with the amount due for payment.

2. Who should issue GST Invoice?

If you are a GST registered business, you need to provide GST-complaint invoices to your clients for sale of good and/or services.

Your GST registered vendors will provide GST-compliant purchase invoices to you.

3. How many copies of Invoices should be issued?

For goods– 3 copies

For services– 2 copies

2. 15 tips on preparing your GST tax invoice

1. Name and Address

Like a sales invoice, the first piece of information that you need to include is your business name and address. Make sure that you use the same address that you registered to obtain your GST number with. If you have multiple offices in different states, then use the address that’s on your registration.

2. GST/GSTIN Number

This is the alpha-numeric number that was assigned to you. It’s needed to verify that you’re registered. In India, this number is 15-digits long with the first two digits representing the state code followed by the the PAN number of the taxpayer.

3. GST Tax Invoice Number

Like a regular invoice, you’ll need a consecutive serial number that contains only alphabets and/or numerals that is unique to that specific invoice.

4. Date of GST Invoice

This is simply the date that the GST tax invoice was issued. In most cases, this is within 30 days from the date that the service was supplied.

5. Recipient Details in GST Invoice

You’re required to include the name, Address, GST/GSTIN number, and the address of the customer. In countries like India you’ll also have to include the name of the State they’re located and its code.

6. HSN Code or SAC Code

HSN is the abbreviation for Harmonized System of Nomenclature and is the internationally accepted product coding system that is used to maintain uniformity in classification of goods. SAC stands for Service Accounting Codes and are adopted by the Central Board of Excise and Customs (CBEC) for identification of the services that you provided.

7. Description of Goods or Description of Services

Like a sales invoice, you also need to list a description of the goods or services provided and the quantity sold.

8. Total Value of Sales and Taxable Value of Sales

One of the most important components of a GST tax invoice is both the total value of sales and taxable value of sales. They need to be clearly and separated on the invoice. If there is a discount or abatement, this can be accounted prior to mentioning the total value of sales.

9. Rate of GST

This is a 4-tier tax structure that will vary depending on the transaction. For example, essential items, like food, won’t be taxed, while luxury items like luxury cars will taxed the highest rate.

10. Amount of GST Charged

The type of supply, where the supply is made, and who the supply is made to will determine the GST rate. However, in countries like Australia, the GST rate is 10%. So, if your invoice is $100, then the calculated GST would be $10. There are handy GST calculators, like this one for Canada and this for India, that can assist you in determining the amount of GST you have to charge.

11. Tax Payable on Reverse Charges

If GST is payable on reverse charges, then you need to clearly mention this as ‘GST PAID ON REVERSE CHARGES’ in the GST Invoice.

12. Revised Invoice

If GST Invoice is a revised; this information also has to be clearly mentioned as ‘REVISED INVOICE’ in the GST Tax Invoice. Typically, the Invoice Number will remain the same as the one issued on the original invoice with the updated changes. If you’ve made any changes in the invoice number or date this also to be mentioned.

13. Supplementary Invoice

If the GST Invoice is a supplementary invoice to the previously issued Invoice, then you need to include ‘SUPPLEMENTARY INVOICE’ to the invoice number.

14. Terms of Payment Details

Similar to a sales invoice, a GTS tax invoice should also contain payment details like how you’re going to be paid and when the due date of the invoice.

15. Signature of the Supplier

A GST Tax Invoice has to be signed by the supplier, or at least an authorized signatory. A digital signature can also be used.

3. FAQs on Invoice under GST

Q1. What’s the difference between invoice date and due date?

Invoice date refers to the date when the invoice is created on the bill-book, while the due date is when the payment is due on the invoice.

Q2. How to issue an invoice under reverse charge?

In case of GST payable under reverse charge, on you must additionally mention that tax is paid on a reverse charge, on the GST invoice.

Q3. Is it mandatory to maintain invoice serial number?

Yes, invoice serial number must be maintained strictly. You may change the format by providing a written intimating the GST department officer along with reasons for the same.

Q4. Can I digitally sign my invoice through DSC?

Yes, you can digitally sign invoice through DSC.

4. Conclusion

If you’re a business owner, then it’s in your best interest to register for a GST number since it improves tax systems by making them more efficient, effective, and transparent. As such, you may also be required to generate GST tax invoices. It may sound complicated, but it’s actually similar to a sales invoice. And, if you follow the tips listed above, then preparing a GST tax invoice should be a breeze. 

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