What is a Tax Invoice under GST?

Author
By Sakshi Shah on February 18, 2019

A Tax Invoice is a document issued by a seller registered under GST to the buyer on sale of taxable goods or services.

A Tax Invoice is important because:

  1. It is the evidence of the supply of goods or services
  2. It is an essential document for the buyer to avail Input Tax Credit
What is Input Tax Credit (ITC) under GST?

Tax Invoice should be issued in the following cases:

  1. A Registered Seller supplying taxable goods or services to a Registered Buyer.
  2. Registered Seller supplying taxable goods or services to an Unregistered Buyer.
  3. Registered Seller making an Inter-State stock transfer to a branch in another state.
  4. Input Service Distributor (ISD) distributing GST Credit to its eligible branches.
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How many copies of Tax Invoice should be issued?

In the case of supply of goods, the seller should issue three copies of an invoice:

  • Original copy: for the buyer and marked as ‘Original for Recipient
  • Duplicate copy: for the transporter and marked as ‘Duplicate for Transporter
  • Triplicate copy: for the seller and marked as ‘Triplicate for Supplier

In the case of supply of services, the seller should issue two copies of an invoice:

  • Original copy: for the buyer and marked as ‘Original for Recipient
  • Duplicate copy: for the service provider and marked as ‘Duplicate for Supplier
What are the details required in a Tax Invoice under GST?

What is the time limit to issue a Tax Invoice?

Type of Supply
Time limit
Supply of Goods1. If the supply involves movement of goods – before or at the time of removal of goods
2. If the supply does not involve movement of goods – before or at the time of delivery of goods to the recipient
3. In case of continuous supply of goods – before or at the time each statement of account is issued or each successive payment is received
Supply of Service1. In normal case: within 30 days from the date of supply of service
2. In case of continuous supply of service: within 30 days from the date when each event specified in the contract for payment
3. Where the service provider is a bank or any financial institution: within 45 days of supply of service