Time of Supply Under GST

Time of Supply

The timing of 'supply' can be classified under the two broad heads, namely:-

• Time of supply of goods
• Time of supply of services

Time of supply of goods

The liability to pay CGST/SGST on the goods shall arise at the time of supply as determined in terms of provision of Section 12, which states as follows:-

The time of supply of goods shall be earlier of the following dates, namely,-

• the date of issue of invoice by the supplier or the last date on which he is required, under the prescribed provision, to issue the invoice with respect to the supply; or
• the date on which the supplier receives the payment with respect to the supply.

Here, the 'date on which the supplier receives the payment' would mean earlier of the following two dates, namely,-

• the date on which the payment is entered in his books of accounts, or
• the date on which the payment is credited to his bank account.

For example.

ABC Enterprises issued invoice to Sachin Limited on 30th Sep 2017. Sachin Ltd made a payment to ABC Enterprises on 2nd Oct 2017 and further, ABC Enterprises credited the entry in their books on 3rd Oct 2017. In the above example, time of supply shall be 30th Sep 2017.

Supply in respect of goods on which levy of tax is on 'Reverse Charge Basis'

The time of supply of goods shall be earlier of the following dates, namely,-

• the date of the receipt of goods; or
• the date of payment as entered in the books of account of the recipient or the date on which the payment is debited in his bank account, whichever is earlier; or
• the date immediately following thirty days from the date of issue of invoice by the supplier:

Time of supply of services

The liability to pay CGST/SGST on the services shall arise at the time of supply as determined in terms of provision of Section 13, which states as follows:-

The time of supply of services shall be earlier of the following dates, namely,-

• the date of issue of invoice by the supplier, if the invoice is issued within the period prescribed or the date of receipt of payment, whichever is earlier; or
• the date of provision of service, if the invoice is not issued within the period prescribed or the date of receipt of payment, whichever is earlier; or
• the date on which the recipient shows the receipt of services in his books of account, in a case where the provisions of clause (a) or clause (b) do not apply:

Here, the 'date on which the supplier receives the payment' would mean earlier of the following two dates, namely,-

• the date on which the payment is entered in his books of accounts, or
• the date on which the payment is credited to his bank account.

Supply in respect of services on which levy of tax is on 'Reverse Charge Basis'

• the date of payment as entered in the books of account of the recipient or the date on which the payment is debited in his bank account, whichever is earlier; or
• the date immediately following sixty days from the date of issue of invoice by the supplier.