Tax invoice – Invoicing under GST Law

Tax Invoice is a crucial document given by the supplier of goods or services to the recipient with details of the transaction for recording different components in the books of accounts.

GST law requires every supplier of taxable goods to issue a tax invoice before or at the time of removal of the goods where the supply involves the movement of goods or before or at the time of delivery of the goods to the recipient where the supply does not involve the movement of goods.

Supplier of services is also required to issue tax invoice before provision of the services or after provision of the services but within a specified time.

tax invoice under gst law

Tax invoice not only evidences the supply of goods or services but is also an essential document for the recipient to avail input tax credit (ITC).

As per GST law, a registered person can not avail input tax credit in absence of tax invoice.

Requirements of Tax Invoice when Supplies does not exceed Rs. 200

Registered persons are not required to issue a tax invoice in respect of goods or services or both where the value therein does not exceed a sum of Rs.200/- subject to the following conditions, namely: –

  • the recipient is not a registered person; and
  • the recipient does not require such invoice,

However, in respect of such supplies, the supplier shall issue a consolidated tax invoice for such supplies at the close of each day in respect of all such supplies.

In the case of supply of goods, tax invoice has to be prepared in triplicate.

The original copy being marked as “ORIGINAL FOR RECIPIENT” will be for the recipient, duplicate being marked as “DUPLICATE FOR TRANSPORTER” should be given to the transporter and triplicate being marked as “TRIPLICATE FOR SUPPLIER” should be kept by the supplier.

Similarly, the tax invoice shall be prepared in duplicate in case of supply of services. The original copy being marked as “ORIGINAL FOR RECIPIENT” should be issued to the recipient and the duplicate copy being marked as “DUPLICATE FOR SUPPLIER” should be given to the supplier.

What tax invoice shoud contain under GST law

Following things a tax invoice should contain;

  • name, address and GSTIN of the supplier;
  • a consecutive serial number, in one or multiple series, containing alphabets or numerals or special characters hyphen or dash and slash symbolised as “-” and “/” respectively, and any combination thereof, unique for a financial year;
  • date of its issue;
  • name, address and GSTIN or UIN, if registered, of the recipient;
  • name and address of the recipient and the address of delivery, along with the name of State and its code, if such recipient is un-registered and where the value of taxable supply is fifty thousand rupees or more;
  • HSN code of goods or Accounting Code of services;
  • description of goods or services;
  • quantity in case of goods and unit or Unique Quantity Code thereof;
  • the total value of supply of goods or services or both;
  • the taxable value of supply of goods or services or both considering discount or abatement, if any;
  • the rate of tax (CGST, SGST, IGST, UTGST or cess);
  • the amount of tax charged in respect of taxable goods or services (CGST, SGST, IGST, UTGST or cess);
  • place of supply along with the name of State, in the case of a supply in the course of inter-State trade or commerce;
  • address of delivery where the same is different from the place of supply;
  • whether the tax is payable on reverse charge basis; and
  • signature or digital signature of the supplier or his authorized representative:

If the registered person has opted for the composition scheme or supplying exempted goods or services or both, he is required to issue a bill of supply and not a tax invoice.

The government of India has specified a format of tax invoice. We request you to download and go through to understand the concept better.

Please remember that taxpayers are free to design their own invoice format. The format provided by CBEC is just for your information. The only thing to be kept in mind is that in GST it’s mandatorily required to have certain fields in the tax invoice.

Editorial Staff at Yourfinancebook is a team of finance professionals. The team has more than a decade experience in taxation and personal finance.