Tax invoice for Exports – How you should raise tax invoice for exports of goods & services under GST

1.0 Introduction

Invoices in goods and services tax are not just important but mandatory as well. It is the basic document for supply of goods and services, as it contains time and place of supply mentioned in it which further helps in tax and valuation.

It is mentioned in the act that a registered person supplying taxable goods and services should for the movement of goods issue a tax invoice, which should include- quantity, description, and value of goods with the tax charged on them.

The article today is for the persons doing export. It is a guide as to how tax invoice for export shall be raised. Before proceeding any further let us understand what exactly export is under GST.

2.0 What is invoice under GST law?

Invoice is a primary document useful in keeping a track of sale and purchase. Tax invoice is a document which includes particulars of the product, details about the supplier, the receipent and the tax charged.

Every registered dealer is required to provide this invoice even the exporters under GST.

Read: Use Free Invocing Software to issue Export Invoices under GST

3.0 How to raise an invoice for exports of goods and services

As said we know the importance of invoicing in GST. Any error or wrong invoice can lead to a lot of chaos and confusion. Hence the government has provided some crucial information that needs to be mentioned on every tax invoice.

Here are the following important points which you must take coginance off while issuing the invoice for exports of goods or services under GST:

#Important Point No.1 – Select the method of exports 

The first thing you should do is to select the method of exports. Under GST law, there are two types of method under which exports of goods or services can be done from India:

• Export against bond or LUT
• Export by paying the IGST

Further, once the one of the method is selected, your invoice shall be prepared and issued accordingly. E.g. if you are issuing invoice against bond or LUT, then you don’t require to charge IGST on the invoices.

Accordingly, if you want to export with payment of IGST, then you need to charge tax separately.

#Important Point No.2 – Mandatory particulars under GST

The following are mandatory details to be mentioned on the invoice:

• Name, address and GSTN of the supplier
• Invoice number
• Date of invoice
• Name, address and GSTN (if registered) of the recipient
• If the recipient is unregistered and value of supply is more than Rs 50,000 then the name and address of the person has to be mentioned
• HSn or Sac code of the goods or services
• Value of goods or services provided.
• Rate of tax on each item
• Whether the tax is payable on reverse charge
• Signature of the supplier or his representative

All these points are important in each and every invoice. Invoice in proper format is necessary for every supply/sale.

Important Point No.3 – Additional details on tax invoice

Apart from the mandatory particulars on the invoices a explained in point no.2 above, there are additional details which are also required to be published on invoice.

If you are exporting against LUT or bond, then you are required to print “SUPPLY MEANT FOR EXPORT UNDER LETTER OF UNDERTAKING WITHOUT PAYMENT OF IGST.”

However, if you are exporting goods with payment of IGST, then you need to print “SUPPLY MEANT FOR EXPORT ON PAYMENT OF IGST”.

Important Point No.4 – Manner of issuing invoice

The tax invoice shall be prepared in triplicate in case of supply of goods under GST in the following manner:

• Original for recipient
• Duplicate for Transporter
• Triplicate for supplier

However, in case of services, duplicate copy for transporter is not prepared.

4.0 What is treated as exports under GST?

Export is supplying of goods or services from one country to another. If you are sending your goods from india to another state internationally then you would come under export.

To make it more clear export is when-

• The supplier is in india
• The recipient is outside india
• Place of supply is outside india
• Payment is received in convertible foreign exchange.

Hence invoices are the bills provided for every sale. With GST coming into the picture the importance of invoices have increased. The Act has also provided the particulars important in a tax invoice.

5.0 Why it is important to raise an invoice

If you raise any invoice which is not fulfilling the guidelines as per GST then you will be liable to pay the penalty of Rs.25,000. Further, if the goods are verified by department and found with issue of invoice, then goods are liable for confiscation along with 100% tax penalty.

6.0 Conclusion

Now we all know the importance of raising proper invoices. If there is any doubt you can mail us at info@hubco.in

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