The Goods and Services Tax, the biggest tax reform of the country since Independence, came into effect at midnight yesterday and traders and service providers alike are scampering to understand and institute the invoice format and bill format. India is one of the last major countries to have a common GST market, and the largest so at that, and in a lengthy speech last night, Prime Minister Narendra Modi extolled its many virtues and calm nerves of the business community. CBEC released the GST rules along with the draft of the bill, and we look at some of the changes here. The GST regime’s invoicing rules and formats have been notified including details such as supplier’s name, shipping and billing address, HSN Code, place of supply, rate. The GST Model Law also has fixed time limits for issuing GST invoices and bills. For supply of goods in the normal scenario, the invoice should be issued on or before the delivery/removal of goods, and in case of a continuous supply of goods, it should be done before the issue of account statement/payment. In the case of services, the time limit is 30 days since the rendering of services, while it is 45 days for services issued by banks as well as NBFCs.
As to the details required for GST invoicing, the notification says that it will include Invoice number and date, Customer name, Shipping and billing address, Customer and taxpayer’s GSTIN, Place of supply, HSN code, Taxable value and discounts, Rate and amount of taxes i.e. CGST/ SGST/ IGST and Item details i.e. description, unit price, quantity.
The invoice serial number has to be maintained strictly, and for invoice under reverse charge it has to be duly mentioned. Under GST, there are several transactions that will be tax exempt and in this case a Bill of Supply has to be issued instead of a Tax Invoice. The format for the tax invoice itself can be downloaded easily from https://www.aces.gov.in/Documents/draft-formats-under-invoice-rules.pdf.