Invoice, according to the Tax Laws Lexicon, means a list of goods that have been shipped, sent or services that have been rendered with prices and charges.
Who are eligible to raise a GST Tax Invoice?
Only a registered taxable person is eligible to raise a tax invoice for every supply of goods or services. Under the CGST Act, it has been made compulsory to raise a tax invoice.
Under Section 31 of the CGST act, tax invoice includes:
a. A document which has been issued by an Input Service Distributor.
b. Any supplementary invoice.
c. A Revised invoice.
A tax invoice should generally include a revised invoice which has been issued by the supplier in respect of a supply that had been made earlier.
The mandatory fields of GST Tax Invoice Format include:
1. Particulars: Tax invoice has to contain:
• Name, address and the GSTIN of the Supplier has to mention.
• Serial Number (Not exceeding 16 characters).
• Date of issue of the invoice.
• Name, address and the GSTIN or Unique Identification Number, if registered, of the recipient and the address of delivery.
• Name and address of the recipient and the address of delivery, along with the state name and the code of the state, if such recipient is unregistered.
• HSN Code of Goods or Accounting Code of Services or HSN code of Goods.
• A tax invoice must mention the description of the goods or services.
• The quantity of goods and unit or Unique Quantity Code should be properly mentioned.
• Value of the goods, services or both that have been supplied must be stated in the invoice.
• The taxable value of goods or services.
• The rate of tax and nature of tax (CGST, SGST, IGST or UTGST).
• Amount of tax charged has to be mentioned.
• Place of supply along with the name & code of the state.
• Whether tax is payable on reverse charge basis, has to be mentioned.
• Signature of Digital Signature of the supplier or his representative.
2. The tax that is being charged on the goods or services or both and other particulars should be crystal clear and very specific.
3. The number of digits of HSN code to be specified on a tax invoice has been specified by the Government vide Notification No. 12/2017 – CGST and 5/2017 – IGST dated 28th June 2017.
It is compulsory to highlight the tax charged under the GST regime unlike the current system of taxation wherein invoices inclusive of tax could be raised.
How to export Invoice Format in GST:
The invoice shall necessarily carry an endorsement in case of exports of goods and services:
“SUPPLY MEANT FOR EXPORT OR SUPPLY TO SEZ UNIT OR SEZ DEVELOPER FOR AUTHORISED OPERATIONS ON PAYMENT OF INTEGRATED TAX”
“SUPPLY MEANT FOR EXPORT OR SUPPLY TO SEZ UNIT OR SEZ DEVELOPER FOR AUTHORISED OPERATIONS UNDER BOND OR LETTER OF UNDERTAKING WITHOUT PAYMENT OF INTEGRATED TAX.”
It shall also contain the following details:
a. Name and address of the recipient
b. Address of delivery
c. Name of the country of destination
Types of Invoices under GST
There are 2 types of invoices under the new regime: a tax invoice and a bill of supply. Let us now examine the differences between them:
* Tax invoice
* Bill of supply
A supplier who has been registered, must issue a tax invoice when he is supplying taxable goods or services. There are specific rules related to the use and the contents of the invoice:
1. Serial number of the invoice:
Serial numbers are consecutive and they consist of letters, special characters, numbers, or any combination, therefore, they are unique for every financial year.
2. Billing and Shipping Address:
These information are required as they will ultimately determine the Place of Supply and the taxation of such transaction accordingly.
3. GSTIN/unique ID:
For the receiver, a GST identification number is required. There are certain specified codes for embassies, UN bodies, or any other class of person so notified.
4.HSN code/accounting code:
The person who has been notified, must include an HSN code for the goods and an accounting code for the services supplied.
Bill of Supply
A supplier who is registered, will issue a bill of supply when:
1. The goods or services that have been supplied are exempt.
2. The supplier has opted to pay taxes under the Composition Scheme.
The bill of supply is governed by many rules and according to them, it must contain the following details:
1. Serial number:
The serial number must be a consecutive number that consists of letters and/or numbers and it should also be unique for one financial year.
2. Details of receiver:
Provide the name, address, and GSTIN/unique ID of the receiver only if the receiver is registered.
3. Particulars of goods:
For the supply value of goods or services, the term “value” is used instead of “taxable value,” as in the tax invoice.
If the value of goods or services that have been supplied is less than Rs 200, then it is not needed to issue a bill of supply.
Time limits for issuing the invoice:
1. Supply of goods:
In the case where the supply involves movement of goods, then the registered person should issue an invoice at the time of removal of goods so that they can be supplied to the recipient. In other cases where there is no movement of goods, the invoice should be at the time when the goods are delivered or they are made available to the recipient.
2. Supply of services:
The tax invoice must be issued within 30 days after the date of completion of services unless the transaction involves banks or financial institutions, in that case, the invoice should be issued within 45 days of completion of services.
3. Receipt voucher:
A receipt voucher or other prescribed documents should be issued as an advance receipt on the supply of goods or services.
4. Reverse charge mechanism:
If an person who has not been registered, supplies goods and services, then the registered receiver should issue an invoice on the date of receipt of goods or services. In this case, the recipient, not the supplier, is liable for the payment of tax.
5. Continuous supply of goods:
When goods and services are supplied, and payment is made, regularly, then the registered supplier must issue an invoice along with each such statement or payment.