GST Invoice Rules and Guidelines

GST has been a major change to the Indian economy and it holds many promises to streamline the taxation system, but has also put many business owners at difficulty when it comes to respecting the rules. The new bill helps eliminate the cascading taxes on production and distribution and has been conceived to replace indirect taxes such as VAT, service tax, excise tax or octroi. In theory it sounds good, but how do business owners proceed further?

GST Invoice Rules and Guidelines

Issue a Tax Invoice for all taxable goods and services, if you registered under GST
Issue a Bill of Supply in case you are registered under Composition Scheme
Make sure you number all your invoices in sequential series
Makes sure your GST invoices contain your name, address, place of supply, GSTIN
Same state sales: CGST and SGST are equally charged. Example: If the corresponding GST rate is 12%, CGST is 6% and SGST is 6%
Interstate sales: For any sale outside the state of your business, IGST has to be charged Example: If you supply services with 18% GST from Tamil Nadu to Maharashtra, or any other state, you have to charge IGST at 18%

DO’s	DON’ts
Maintain records of every document you create and receive, ensuring they have the correct details on them	Don’t buy from unregistered dealers if you wish to get input tax credit on GST.
Make sure you are charging GST correctly - CGST and SGST for same state, IGST for different state sales	Don’t forget to add a different serial number for every invoice
Issue tax invoices on sale of taxable goods and services	In case your invoice has already been issued and paid for, don’t cancel it. Issue a credit note instead
Take tax invoices on all purchases of goods and services. Make sure they mention advance payments, if any.	Don’t ship products without the original invoice
Ensure all documents have your GSTIN and the client’s or supplier’s GSTIN where applicable	Don’t charge tax as GST, make sure you split it correctly in between CGST and SGST or IGST.
Do submit GST reports on time

Check out a detailed analysis of the GST invoice rules and what an invoice should include here:

Learn how to check if a GST Invoice is genuine

Is your business ready for GST?

Being GST compliant when running a business might seem like a burden but it’s still very important to make sure you are respecting all regulations. It would be a lot easier if you could have a reliable, GST ready system for invoicing and keeping track of stock. If it were easy to use and accessible anytime you need, you’d really save a lot of time.

That’s why we built Sleek Bill, to help you invoice faster, simpler and keep track of everything while complying with GST. You can issue gst invoices, quotes, delivery notes, purchase orders, credit notes, keep track of stock, add payments and check how who’s overdue on their balance and much much more.

GST Explained

What is GST bill?

GST, short for Goods and Services tax, is a new tax that will be imposed on the sale and purchase of goods and services in India. GST is meant to replace all taxes in India with a single unified tax applied to value addition instead of the total value of the product at each stage in the supply chain.

This method provides credit for the input tax paid on the purchase of goods and services, which can be offset with the tax to be paid on the supply of goods and services. As a result, this reduces the overall manufacturing cost, with the end customer paying less.

Which goods and services are exempted from GST?

With certain current taxes remaining, the following goods and services will be fully or partially exempted from the GST

What are the GST benefits for your business?

Free movement of goods: Business owners will be able to sell more in other states without having to worry about interstate transaction costs. With GST, the entry tax will be eliminated, which will save time and money spent.

What taxes does GST replace?

Currently, there are many indirect taxes that both the state and central governments are collecting on every purchase and sale.

How will GST work in practice?

The GST will follow a similar model with the one before it

What is the proposed GST rate?

GST will have a 4-tier tax structure

Why is GST being introduced in India?

One of the main reasons for GST being introduced in India is the tax burden that falls both on companies and consumers. With the current tax system, there are multiple taxes added at each stage of the supply chain, without taking credit for taxes paid at previous stages. As a result, the end cost of the product does not clearly show the actual cost of the product and how much tax was applied. This cascading structure is too complex and inefficient.

How will Inter-state transactions work in GST?

For inter-state transactions, the Centre will levy Integrated GST (IGST), which is equal to the average of the CGST and SGST rates. After applying IGST, CGST and SGST credits received from purchases, the seller will then pay the remaining IGST on the added value.

What is the exemption limit in the GST?

Businesses with turnover revenue of 20 lakhs and above will have to register and file for GST returns, with a threshold of 10 lakhs for businesses in the north east and hill states.

How will imports be handled in GST?

A combination of CGST and SGST will be applied to the import of goods and services that come to India. Tax benefits and credits will be given to the state where the imported goods and services are consumed.