In this article, we’re going to take a closer look at the basics od documents under GST
Introduction to the documents under GST
Basics of Tax Invoice and other documents under GST
An invoice issued by a seller to a buyer is a commercial instrument that identifies both parties and also describes and quantifies the terms and conditions sold, the shipping date and mode of transport, prices and discounts, if any, and terms of delivery and payment. In some of cases, an invoice serves as a demand for paymentand becomes a document of title when paid in full.
Invoice under GST
Under the GST regime, an “invoice” or “tax invoice” means the tax invoice referred to in Section 31 of the CGST Act.
For supplier of goods or services: It mandates the supplier of goods or services to issue a tax invoice or a bill of supply for every supply of goods or services.
For recipient of goods or services: The GST law mandates that any registered person buying goods or services from an unregistered person needs to issue a payment voucher as well as a tax invoice. In case a registered person is making or receiving supplies from an unregistered person, then the registered will be required to issue tax invoice. However, if a registered person is dealing only exempt supplies or has availed composition scheme then such person has to issue bill of supply.
Importance of Tax Invoice in GST
(a) GST is chargeable at the time of supply, Invoice is an important document which indicates the time of supply.
(b) Possession of Tax Invoice or Debit Note is one of the basic conditions for claiming ITC.
(c) It is commercial instrument issued by the suppliers of goods or services.
(d) It ensures transparency in the transaction.
(e) The tax invoice serves as a document that proves payment of the value of goods or services, or both, including any taxes due on them.
About The Author: CA Siddhi Shah
I am Chartered Accountant practicing in GST Law, Corporate Law and Income Tax Law.
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