What a GST invoice must show: a checklist for small businesses
If your business is registered under GST, the bill you give a customer is a legal document with required contents. A missing detail can cost a business customer their input tax credit, and they will come back to you to fix it. Here is what to check, and which kind of document you actually need.
Which document do you need?
| Document | Who uses it |
|---|---|
| Tax invoice | A GST-registered business selling taxable goods or services. It shows the tax charged. |
| Bill of supply | A registered business selling exempt items, or one under the composition scheme. It shows no tax, because no GST can be charged on it. |
| Simple receipt or cash memo | A business that isn't registered for GST, or anyone recording that money was received. It isn't a tax invoice and can't be used to claim credit. |
The tax invoice checklist
Rule 46 of the CGST Rules, 2017 sets out what a tax invoice must carry. In practice, check for these:
About you
- Your business name, address and GSTIN.
- A signature or digital signature of you or your authorised representative. No signature is needed on an invoice issued electronically under the IT Act.
About the invoice
- Invoice number: consecutive, unique within the financial year, and no more than 16 characters. Letters, numbers, hyphens and slashes are allowed.
- Date of issue.
- The words "Tax Invoice".
About the customer
- Registered customer: their name, address and GSTIN.
- Unregistered customer, ₹50,000 or more: their name and address, the delivery address, and the state name and code.
- Unregistered customer, under ₹50,000: the customer's name and address aren't required in most cases.
About what was sold
- A description of each item.
- The HSN code for goods or SAC code for services. Businesses with turnover up to ₹5 crore give at least 4 digits on sales to registered customers, and those above ₹5 crore give 6 digits on all invoices.
- Quantity and unit, for goods.
- Total value, any discount, and the taxable value.
About the tax
- The rate and amount of tax, shown separately as CGST and SGST, or as IGST.
- Place of supply, including the state name, for sales to another state.
- Whether tax is payable under reverse charge.
Three details people often miss
- Numbering restarts wrongly or skips. Keep one series for each financial year and don't reuse a number, even for a cancelled bill. Mark it cancelled instead.
- Copies. For goods the invoice is prepared in three copies, marked original for the recipient, duplicate for the transporter and triplicate for the supplier. For services it's two copies: original and duplicate.
- Small sales. For a sale under ₹200 to an unregistered customer who doesn't ask for an invoice, you can issue one consolidated invoice at the end of the day instead of a separate one each time.
When e-invoicing applies
Businesses above a set annual turnover must report business-to-business invoices on the government's e-invoice system. The threshold has been lowered several times over the years, and ₹5 crore is the figure generally quoted, so confirm the current one on the GST portal if your turnover is near it.
About our Quick Receipt app: it makes a simple receipt for a sale, which suits cash sales and businesses that aren't GST-registered. It isn't a GST tax invoice. If you are registered and selling taxable goods, use billing software that produces a compliant tax invoice.
This guide is general information based on Rule 46, Rule 48 and Rule 49 of the CGST Rules, 2017, and it isn't legal or tax advice. Rules change, so confirm the current requirements at cbic.gov.in or with your accountant.