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Tax Invoice under GST - How to Raise a Tax invoice under GST Regime?
Goods and Services Tax (GST) has removed other indirect taxes from the country. It has made a single unified tax system in the country making the tax system easier than previous. In this article, we will deal with how to raise invoice under GST.
Invoice is a non-negotiable instrument issued by the seller at the time of purchase. It includes a list of items, date of purchase, date of shipment etc. Invoices are an important source for bookkeeping and maintaining books of accounts. It helps to find a number of sales and revenue generated. It is also called a bill of lading or bill of sale. At the time of supply of goods, the supplier needs to issue three copies of tax invoice – Original Copy (the buyer gets the original copy of the invoice), Duplicate Copy (It is issued to the transporter to present when required) and third one is Triplicate Copy (It remains with the supplier for his own record). At the time of supply of services, two copies of the invoice are generated – Original (the person getting service), Duplicate (it remains with the person giving service).
What does invoice include?
The invoice includes a list of particulars which are kept as a proof with the seller and another copy is given to the buyer. The main parts of invoice include:-
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Name and details – Invoice contains a name and details like an address of both customer and seller. An invoice can be created either manually or with the help of software. If one is creating an invoice through software then one need to maintain the data in one’s database and can use email id to generate an invoice.
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Date of purchase – It includes a date on which invoice was created.
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Particulars of items purchased – It includes particulars of items purchased along with prices and quantity.
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Terms of Payment – Terms of payment is generally for 30 days.
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Invoice Number – It is the unique number generated with every invoice. It is specific for each invoice and is kept as a proof of tax paid.
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Customer and Tax payer’s GSTIN – Goods and Services Tax Identification Number (GSTIN) is a unique number allotted to each taxpayer by the state. It is a 15 digit code.
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HSN Number – HSN Number is used to classify goods for taxation.
What is an invoice for GST?
Goods and Services Tax (GST) is a single indirect tax applicable all over the country, made compulsory from 1st July 2017. The government has made invoice compulsory for businesses. The government has also made a standard format for invoicing under GST which includes supplier’s name, shipping address, billing address, Place of supply, rate, HSN Code etc.
Under GST, there will be two types of invoices:-
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Tax invoice
This is issued in case a registered taxable person supplies taxable goods and services. It is issued to charge the tax.
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Bill of Supply
At some places, the supplier is not allowed to issue any tax invoice. So, the document issued in such cases are called Bill of Supply.
Time limit to issue invoice under GST Regime
There are certain rules for time for issuing an invoice to the customers. These are as follows:-
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Supply of Goods (General Case) – On or before the date of delivery.
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Supply of Services (General Case) – within 30 days of supply of services.
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Supply of Goods (Continuous Supply) - On or before the date of issue of account statement/ payment.
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Supply of Services (Banks & NBFCs)- within 45 days of supply of services.
Types of GST Compliant Invoices
Different types of invoices under GST Regime are as follows:-
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sales invoices
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purchase invoices
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bill of supply
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credit notes
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debit notes
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advance receipts
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refund vouchers
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delivery challans (for supply on approval, the supply of liquid gas, job work and other).
Steps to Raise Invoice under GST
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The government has designed a standard format for an invoice to take certain basic data which every invoice must have but one can design invoice according to its needs.
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The time period of issuing invoice varies from goods to goods and services to services. The maximum period of issuing invoice is 30 days.
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Small taxpayers need not issue invoice per transaction to unregistered customers if there are a number of transactions up to Rs 200.
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In the case of goods, three copies of an invoice are to be issued and in the case of services, two copies of an invoice being issued.
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GSTN provides a facility to generate a unique number with every transaction which needs to be carried at the time of transportation of goods.
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Taxpayers up to 1.5 crores of turnover, need not mention HSN Code in their invoice.
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If VAT invoice has already been issued, then, there is no need to issue separate Bill of Supply.
Click here to get the standard format of Tax Invoice issued by GST government department.
