Since the implementation of the Goods and Services Tax (GST), every GST-registered business must share a GST invoice with their customers/clients. A GST invoice can be defined as a bill that enlists services and goods transferred from the seller to the buyer and the amount of money the latter owes to the former.
GST invoices are issued by GST-registered businesses. The sellers must maintain a particular GST invoice format while sending GST-complaint bills to the clients. Vendors registered with the GST Council with their own GST Identification Number (GSTIN) are required to provide the bills of purchase in the GST invoice format.
As per the format prescribed under the GST Act, 2017, a GST invoice must include the following fields:
Date of issuance of the invoice
Name of customer
GSTIN of the business and the customer (in case the customer is registered)
Place of supply
Quantity, description, and any other details about the product/service
Net taxable value
Applicable GST rates
Total GST charged under the different headers: CGST, SGST, UTGST, and IGST
Signature of the supplier
Businesses are required to follow certain rules and guidelines related to the serial number, signature, and payments while issuing a GST invoice:
The invoice number must be an alphanumeric combination.
GST invoices must be numbered in a sequential manner.
The serial number of a GST invoice must be 16 digits or less.
The GST invoice must be signed either by hand or digitally (as per the regulations laid down by the Information Technology Act, 2000).
The invoice must be signed by either the supplier themselves or by any of their representatives.
If a registered entity makes a payment to an unregistered entity, the former has to issue a GST invoice.
In case a registered entity receives a product/service that is exempt from the GST Act, they need to issue a bill of supplies instead of a tax invoice.
There are certain rules regarding the timing of the issuance of GST invoices as per the Goods and Services Act, 2017. The rules are different for goods and services.
1. For Goods
For a one-time supply of goods, the GST invoice should be issued on or before the date of delivery.
In cases of continuous supply of goods, the GST invoice must be issued on or before the day when the account statement is issued.
2 . For Services
GST invoice for services must be issued within 30 days of the supply.
In cases of services associated with banks or NBFCs, the GST invoice has to be issued within 45 days of supply.
There are three types of GST invoices prescribed under the GST Act, 2017:
Bill of Supply: A bill of supply is issued when the supplied goods/services are exempt from GST or the supplier has opted for the composition scheme. Whenever a Bill of Supply is issued, the supplier is not liable to pay any GST.
Aggregate Invoice: The seller is permitted to issue an aggregate invoice or a bulk invoice in case the buyer is unregistered and the total value of several invoices is not more than a total of two hundred rupees.
Debit/Credit Note: If the value of the invoice changes later (after the supply of goods/services), the seller issues a debit note (if the invoice value increases) or a credit note (if the invoice value decreases).
There can be several reasons owing to which a seller might end up issuing a GST invoice with incorrect data. Therefore, the GST council has provided a provision for revising an invoice that has been issued. A revised GST invoice must have “Revised Invoice” mentioned on it.
A seller must issue three copies of the invoice in case of the supply of goods - the original copy to be received by the buyer, a duplicate copy to the transporter of goods, and a third copy to be kept by the seller.
In the case of services, only two copies of the invoice are to be issued - one each for the buyer and the seller.
In the case of certain special services such as banking and passenger transportation, certain relaxations are provided by the government in terms of GST invoicing and/or following the GST invoice format. It must be noted that you must generate your GST invoice format in an Excel sheet while following the rules to ensure the smooth functioning of your business operations.
Yes, the GST number of the supplier is mandatory on the invoice.
Yes, a hand-written invoice is allowed as per the GST rules.
Yes, you are allowed to sign the invoice either by hand or digitally using a Digital Signature Certificate (DSC).
The invoice date is the date on which the invoice is issued, while the due date is the last date by which you have to pay the bill to the seller.
While issuing a GST invoice under the reverse charge, it is mandatory to clearly mention on the invoice that the applicable tax was paid in the reverse charge.