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Useful Information About GST Invoicing

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India is steadily moving towards the much awaited GST. It is hoped that this transitional step is going to take India forward in terms of financial growth of the country. It is believed that invoicing under GST is going to push the country towards a paperless India as the entire process is going to be made completely electronic and all transactions are going to take place online.

When it comes to implementation, GST invoicing forms a crucial part of the entire reform. Invoice is nothing but a document having the record of sale/ purchase in the books of accounts. It includes the details of product, description, quantity, details of supplier, tax charged, discount etc. The government authority has notified rules of invoicing under GST along with a template of invoice (GST INV-01).

Under the GST regime, two types of invoices shall be issued as under:

  • Tax Invoice: Every taxpayer registered under GST must issue a compulsory tax invoice for all the effected sales. Input tax credit can be claimed by issuing a tax invoice.
  • Bill of Supply: A supplier who supplies exempted goods or services or the one who has opted for Composition scheme should issue bill of supply. A bill of supply cannot be a document of claim for Input Tax Credit.

Time Limit to Issue Invoice

The GST tax invoice shall be issued by a registered dealer on or before the time the goods are moved for supply and on or before the time the recipient receives the delivery.

For supply of services, the invoice should be issued within 30 days of supply of services (45 days in case of banks, NBFCs). At present, invoices and bills can be issued inclusive of tax while in other cases, it is mandatory to mention the tax exclusively.

How Many Copies of Tax Invoice Are To Be Issued?

Three copies of tax invoice- original, duplicate, triplicate ought to be issued for the supply of goods the purposes of which are listed below.

  • Original Invoice

Issued to the receiver and to be marked as ‘Original for recipient.’

  • Duplicate Invoice

Issued to the transporter and to be marked as ‘Duplicate for Transporter.’

  • Triplicate Invoice

To be retained by the supplier and to be marked as ‘Triplicate for supplier.’

Two copies of invoice are to be issued for the supply of services which are listed below:

  • Original Invoice

Issued to the receiver and to be marked as ‘Original for recipient.’

  • Duplicate Invoice

To be retained by the supplier and to be marked as ‘Triplicate for supplier.’

Rectifying Errors in Invoice

  • Issue credit note to record decrease in taxable value or GST charged in the original invoice. The credit note shall be issued on or before 30th September following the end of financial year in which the supply shall be made OR the date of filing the annual return, whichever is earlier.
  • Issue debit note to record increase in the taxable value or GST charged in the original invoice.

Conclusion

To ensure a seamless flow of credit, a proper GST invoice format needs to be followed that will help in compliance of invoicing under GST (Supply of Goods).

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