1. What is GST Invoicing?
Under GST law, a tax invoice is a legal document issued by a registered seller to the buyer. It contains details of goods or services, tax rates, and the amount payable. Businesses must issue GST-compliant invoices to claim input tax credit (ITC) and ensure smooth compliance.
2. GST Invoice Formats
Mandatory Fields
- Invoice number and date
- Supplier & customer details (GSTIN, address)
- HSN/SAC codes
- Taxable value and discounts
- CGST, SGST, IGST breakdown
- Total invoice value (in words and figures)
Pro tip: Keep invoice numbering sequential and unique for each financial year.
3. Special GST Documents
Credit Notes
Issued when goods are returned, or excess tax is charged. Credit notes reduce the seller’s tax liability.
Debit Notes
Issued when undercharged tax or amount needs adjustment. Debit notes increase the seller’s tax liability.
Bill of Supply
Used when selling exempt goods or by composition scheme dealers (no tax charged on the invoice).
Cash Memos
For unregistered sales to consumers where GST invoice may not be mandatory.
4. E-Invoicing under GST
E-invoicing is mandatory for businesses above a turnover threshold. Invoices must be reported to the GST Invoice Registration Portal (IRP) to generate a unique Invoice Reference Number (IRN) and QR code.
5. Compliance Workflows
- Create GST-compliant invoice
- Upload to GST portal or IRP (if e-invoicing applies)
- Maintain records for GST returns (GSTR-1, GSTR-3B)
- Reconcile invoices with suppliers/customers for ITC claims
6. Common Mistakes to Avoid
- Missing mandatory fields (e.g., GSTIN, HSN code)
- Incorrect GST rate application
- Duplicate or non-sequential invoice numbers
- Failure to issue credit/debit notes properly
- Not reconciling invoices with GST returns
7. Best Practices for GST Compliance
- Automate invoicing with GST-compliant software
- Verify GSTIN of customers using the official portal
- Regularly reconcile GSTR-2B with purchase records
- Train staff on invoice accuracy and timelines