Invoicing is a crucial aspect of tax compliance for every business. It is essential to be aware of the rules of invoicing under GST. Let us understand these in detail.
Invoicing in the current tax regimes
In the current tax regimes, two types of invoices are issued:
- Tax invoice – This is issued to registered dealers, and can be used to claim tax credit. Sample formats of the two main types of tax invoice in the current tax regime, the Rule 11 Excise invoice and tax invoice are shown below.
- Retail or commercial invoice – This is issued to an unregistered dealer or retail customer, and no tax credit can be claimed on this invoice. Sample format of a retail invoice in the current tax regime is shown below.
Invoicing in the GST regime
In the GST regime, two types of invoices will be issued:
- Tax invoice
- Bill of supply
When a registered taxable person supplies taxable goods or services, a tax invoice is issued. Based on the rules regarding details required in a tax invoice, a sample tax invoice has been shown below.
What is the time limit for issue of tax invoice?
|Supply of goods||The tax invoice must be issued before or at the time ofRemoval of goods, where supply involves movement of goods
E.g. – When Super Cars Ltd, a car manufacturer, supplies cars to its dealer Ravindra Automobiles, the invoice must be issued at the time of removal of the cars from Super Cars Ltd’s premises. This is because the supply involves movement of the cars to Ravindra Automobiles’ premises.
Delivery of goods to the recipient, where supply does not require movement of goods
E.g. – Super Cars Ltd purchases a generator set, which will be assembled and installed at the factory premises by the supplier. Here, since the supply does not require movement of the generator set, the invoice must be issued at the time when the generator set is made available to Super Cars Ltd.
|Supply of services||The tax invoice must be issued within 30 days from the date of supply of the service.
Where the supplier is a bank or any financial institution, the invoice must be issued within 45 days of the supply of service.
Note: In case a person paying tax on reverse charge receives goods or services from an unregistered supplier, the receiver must issue an invoice on the date of receipt of goods or services.
How many copies of the tax invoice are required?
For supply of goods, three copies of the invoice are required – Original, Duplicate, and Triplicate.
Original invoice: The original invoice is issued to the receiver, and is marked as ‘Original for recipient’.
Duplicate copy: The duplicate copy is issued to the transporter, and is marked as ‘Duplicate for transporter’. This is not required if the supplier has obtained an invoice reference number. The Invoice reference number is given to a supplier when he uploads a tax invoice issued by him in the GST portal. It is valid for 30 days from the date of upload of invoice.
Triplicate copy: This copy is retained by the supplier, and is marked as ‘Triplicate for supplier’.
For supply of services, two copies of the invoice are required:
- Original Invoice: The original copy of the invoice is to be given to receiver, and is marked as ‘Original for recipient’.
- Duplicate Copy: The duplicate copy is for the supplier, and is marked as ‘Duplicate for supplier’.
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