Advance received

When ‘supplier of goods’ receives advance payment, he is not required to pay GST at the time of the receipt of advance payment, however, under this situation, the time of supply would arise only at the time of issuance of the invoice and the tax liability needs to be discharged only at that time.

It must essentially be noted here that the above exemption is available only to the supplier of goods, meaning thereby that the supplier of service needs to pay the tax at the time of advance receipt. Further, the exemption is also not available to the composition scheme dealer.

ADVANCE PAYMENT ENTRIES IN GOODS AND SERVICE TAX RETURN (GSTR) –

Sr. no. 11 of GSTR -1 contains details of advance payment and the same is briefed hereunder –

Details of advances which has been received, in the current tax period, by a registered person for which invoice has not been issued needs to be provided under sr. no. 11A. Details of both intra-state supplies and inter-state supplies needs to be bifurcated.

Details of advances which had been received in the earlier tax period and which has been adjusted against the supplies being shown in the current tax period needs to be provided under sr. no. 11B. Details of both intra-state supplies and inter-state supplies needs to be bifurcated.