Almost a month ago, Rahul registered himself under GST. Since then, he had issued three tax invoices to his clients, only to hear back that the invoices were generated incorrectly.
To his knowledge, he had included details such as client name, address and the invoice amount, which he believed were enough.
Here is the things that he didn’t keep in mind :
What is a tax invoice?
All the taxpayers registered under GST must issue a tax invoice for goods or services supplied by them.
If the recipient is unregistered and doesn't require the invoice, the seller may not issue the tax invoice.
For all such sales, he must issue a consolidated tax invoice at the end of each day.
What are the necessary details to be mentioned in a GST compliant tax invoice?
- Name, address and GSTIN number of the seller,
- Invoice Number (unique for a financial year) and date,
- If the recipient is registered - Name, Address and GSTIN number of the recipient,
- If the recipient is unregistered AND the value of taxable supplies is ? 50,000 or more - Name and address of the recipient, delivery address, state and code.
These details must be mentioned if the recipient explicitly requires them to specify on the invoice, even if the value of taxable supplies is less than ? 50,000.
5. HSN code of goods or accounting code of services
HSN isn't required if turnover is less than ? 1.5 crores. Only two digits are needed if turnover is between ? 1.5 - 5 crores. 4 digits to be mentioned if turnover is more than ? 5 crores.
- Description of goods or services,
- Quantity and unit of goods (5 kg or 3 litres )
- Total value,
- Taxable value (after deducting discounts and rebates)
- Rate and amount of GST
- Place of supply and the state for interstate sales,
- Delivery address if it is different from the place of supply,
- Whether the tax is payable on reverse charge mechanism, and
- Signature of the authorised signatory
How will exporters issue tax invoice?
If the seller is exporting the goods or services, he will also mention the following line on the invoice, apart from the details above -
'supply meant for export/supply to SEZ unit or SEZ developer for authorised operations on payment of integrated tax.” or
'supply meant for export/supply to SEZ unit or SEZ developer for authorised operations under bond or letter of undertaking without payment of integrated tax.”
He must mention the country of destination instead of the state.
How many copies of invoice must be issued?
For selling goods, 3 copies of invoices must be issued -
- Original for recipient,
- Duplicate for transporter, and
- Triplicate for supplier (self)
For supplying services, 2 copies of invoices must be issued -
- Original for recipient and
- Duplicate for supplier