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Tax invoice for reimbursement of expenses

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Nimesh joshi

Office Executive

88 Points Posted on 04 June 2022

We have incurred some expenses for testing of equipment on behalf of our buyer.

GST Tax invoice is in our Name.

We are in Maharashtra and testing is done in Maharashtra so the accordingly it is local GST invoice.

Our buyer is in Karnataka.

How do we bill to our buyer.

Can we take ITC credit on the invoice ?

Can we raise a debit note or tax invoice for reimbursement of expenses with basic amount + igst on our buyer and deposit the IGST

Can our buyer take ITC set off on the basis of our Debit note.

Replies (7)

Quick Summary

This discussion clarifies how to handle GST for expense reimbursements when the service is provided in Maharashtra but the buyer is in Karnataka. The consensus is that you can claim ITC on the original GST invoice as it's in your name. You should then raise a tax invoice, potentially structured as a debit note, to your buyer, charging IGST. Your buyer in Karnataka can then claim ITC on this debit note.

CA Altamush Zafar

GST Consultant

15986 Points Posted on 04 June 2022

Take ITC since it is in your name and then raise Invoice to your client. Debit note will not be issued

Nimesh joshi

Office Executive

88 Points Posted on 04 June 2022

Dear Mr. Altamush,

Thanks for the reply. As per your reply we can raise our invoice as service charges, charge IGST and deposit the same and our buyer can take ITC set off the same