Legal requirements and content of Tax Invoice under the GST

The goods and services act was introduced in 2017 which included a tax on supply of goods as well as services, unlike the VAT which covered the goods and finance act which covered the service tax. The purpose of the goods and service act was to simplify and make GST compliance easy. Two forms are filed for the GST returns. These are Form GSTR 1 and GSTR 3B. Form GSTR 1 contains the details of outward supply and supply can be a taxable, non-taxable, exempted or other supply. Whereas in GSTR 3B details of outwards supply with GST liability and input tax credit are filled. gst consultant on gurgoan. The purpose of both Form GSTR 1 and Form GSTR 3B is the same, to report the sales and purchases you have made in the relevant period and the tax liability you have paid in the return.

In Form GSTR 1 details of all invoices are filed. When the invoices are issued to the person registered under the GST (B2B supply) the complete details of the tax invoice are filed in the GST return, however, no details are filled in if the purchaser of goods or services is the unregistered person (B2C supply).

 The details of the invoice should be correct and as per the rules prescribed under the GST law so that the purchaser of the goods or services has GST registration in gurgaon can take the input tax credit. Let us make you understand the importance of tax invoices, the content of invoices, the time of issue and the other provisions of invoices in detail after you take the GST registration in Gurgaon.

Importance of Tax Invoice:

Under the GST law and other allied laws like the income tax act, all transactions should be supported by documentary evidence. Under the GST law, if a supply is made without creating the invoice, it may lead to penalties and sometimes prosecution under the act. Therefore, the person should take the advice of a GST consultant in Gurgaon or a chartered accountant in Gurgaon to issue the proper invoice. The tax invoice is a base document for the supply of goods at the time of its movement. Without a tax invoice, the purchaser cannot take an input tax credit for respective goods and services. There are some general highlights as given below for your covenants:

  1. Tax invoice is a document issued for the supply of goods and services to the registered and unregistered person.
  2. Where any change is made after the issue of invoices, such amendment should be done through debit and credit notes.
  3. Where any exempted supply is made, a bill of supply is issued
  4. If any advance is received from the purchaser of goods or services, then a receipt voucher is issued.
  5. Where any good is delivered other than supply, like sending goods to job-worker, then delivery challan is issued.

Content of Tax Invoice

Rule 46 of the GST, prescribes that what should be content of tax invoice:

  1. Name, address, and GSTIN of supplier supplying taxable goods.
  2. Invoice should be a serial number, in one or multiple series (no exceeding 16 characters), containing, alphabets, numerals or special characters. and any combination of the unique financial year,
  3. Date of issue of tax invoice
  4. Name, address and GSTIN of the recipient (if registered)
  5. Name, Address of the recipient and the address of delivery, along with the name of State and its code, if such recipient is unregistered and where the value of taxable supply is Rs. 50,000 rupees or more
  6. If the value of the taxable invoice is less than Rs. 50,000 issued to an unregistered person, indicating the address may require on the request of the recipient of supply
  7. HSN code of goods
  8. Description of goods
  9. Quantity in case of goods and units or unique quantity code
  10. Total value of supply of goods
  11. Taxable value of supply of goods taking into account the discount and abatement if any
  12. Rate of tax
  13. Amount of tax charged
  14. Place of supply along with the name of the state
  15. Address of delivery in case the address is different from the place of supply
  16. Whether tax is payable on a reverse charged basis
  17. Signature or digital signature of the supplier (Signature or digital signature is not required where invoice is issued electronically)
  18. Quick invoice code, having embedded invoice reference number
  19. “Supply meant for export on payment of IGST” or “supply meant for export under bond or NRI tax consultant in gurgaon letter of undertaking without payment of IGST” in case of export of goods is taking place under the bond and letter of undertaking.

Time limit of issue of invoice:

a. Time limit of issue of tax invoice in case of the supply of GOODS

In the case of goods, the invoice should be issued before or at the time of removal of goods when supply involves the movement of goods,

b. Time limit of issue of tax invoice in case of the supply of SERVICE

In the case supply of services, the tax invoice can be issued before or after the provision of services.  Rule 47 prescribes a time limit of 30 days from the date of supply of services for the issue of tax invoice.

Manner of issue of Tax Invoice:

The tax invoice shall be issued in triplicate, in case of the supply of goods;   

       a) the original copy being marked as ORIGINAL FOR RECIPIENT;

       b) the duplicate copy being marked as DUPLICATE FOR TRANSPORTER; and

       c) the triplicate copy being marked as TRIPLICATE FOR SUPPLIER

Documents should be carried with an E-way bill:

A Transporter or a person who is taking the goods with him should carry the E-way bill with them accompanied by;

  • Tax invoice (where supply is a taxable supply)
  • Bill of supply (where supply is an exempted supply)
  • Delivery challan (where goods are delivery for a purpose other than the supply)
  • Bill of entry in case of import

Note: No e-way bill is required in case of the supply of service.

Situations when delivery challan can be issued

  • Transport of goods to the job worker
  • Transportation of goods other than job worker
  • transportation of goods in a semi-knocked down or completely knocked down condition or in batches or lots; or
  • Transportation of goods as may be notified by the central board of indirect tax.

What documents are issued when the supply received from an unregistered person covered under the reverse charge mechanism (RCM)

In the case of RCM, the supplier receiving goods or services from an unregistered person shall issue a ‘Self-tax Invoice’ to himself. However, if the supplier is a registered person then, the invoice issued by the supplier is sufficient to take input tax credit.

You may refer to our articles on GST;

1. GST provisions applicable to Non-residents in India

2. Complete details about the Casual Taxable Person under GST

3. All about GST Registration, Process and Procedure

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