When to Issue Invoice under GST? - Time of Supply

The issuance of a GST invoice is closely related to the concept of time of supply under GST. In this article, we look at both the time to issue an invoice under GST and time of supply in detail.

When should GST invoice be issued?

The supplier shall issue the GST invoice for all the supply of goods and services on exceeding the value of Rs.200. If the supplier registered with GST for providing goods and services, then, the supplier must provide invoice irrespective of the taxable value, if demanded by the customer. The time for issuing GST invoice differs based on the type of supply, i.e., goods or services.

However, in some cases, the supplier shall issue a tax invoice at the time of delivery of goods or while making the goods available to the recipient. In such cases, a delivery challan can be issued by the supplier to generate GST Eway bill and transport the goods to the recipient without a tax invoice.

For services, the supplier shall issue the tax invoice before or after providing the service, but not later than thirty days from the date of providing of service.

When should GST estimate be issued?

On issuing an invoice, the supplier becomes liable for the remittance of GST tax amount mentioned on the invoice. Hence, an invoice should be issued only if the supply has started or if payment has been received. If neither supply or payment has started, then it's best to issue an estimate to the recipient with a breakup of the pricing, GST tax payable and GST rates applicable. Know how to issue a GST estimate.

Should an invoice be issued for advance payment received?

GST receipt voucher can be issued in case of an advance payment is received for goods or services. If the services or goods are not provided and the amount is refunded, a GST refund voucher can be issued. However, the tax applies on payable in advance received for supply of goods or services even after issuing receipt voucher.

Time of Supply under GST

Time of supply under GST is the date on which the tax liability arises on the person registered under GST. Various provisions in GST law dealing with the procedure for determining the time of supply for different types of transactions.

Time of Supply for Goods

For goods, the time of supply is the earliest of the following dates:

Date of issue of an invoice by the supplier. Upon failure to provide the invoice, the last due date for issuing the invoice
Date on which the supplier received the payment.

For services, the time of supply is the earliest of the following dates:

Date of issue of an invoice by the supplier. The supplier shall provide the service invoices within 30 days of provisioning of services.
Date of receipt of payment.

In case it is not possible to determine the time of supply based on the above-mentioned methods, then the time of supply would be the earlier of date of filing of GST return or date of payment of GST. Click here for GST registration