What a GST invoice must contain (and the mistakes that cost you input credit)
If you're registered under GST, the invoice you hand a customer isn't just a receipt — it's the document their accountant uses to claim input tax credit. Get a field wrong and that claim can be rejected, which means an awkward call and a customer who is now chasing you for a corrected copy.
Here's what a tax invoice has to contain, and where things usually go wrong.
The mandatory fields
Under Rule 46 of the CGST Rules, a tax invoice needs:
- Your name, address, and GSTIN
- Invoice number — consecutive, unique within the financial year, and no more than 16 characters. Letters, numbers, hyphen, and slash only
- Date of issue
- Customer's name and address
- Customer's GSTIN, if they're registered
- Place of supply, and the state code — this decides whether you charge IGST or CGST + SGST
- HSN code for goods, or SAC for services
- Description, quantity, and unit of what you supplied
- Taxable value, after any discount
- Tax rate and tax amount, split into CGST, SGST, and IGST as applicable
- Whether tax is payable on reverse charge
- Signature or digital signature
For an unregistered customer where the value is ₹50,000 or more, you also need their address and the delivery address.
Where it usually goes wrong
Breaking the invoice number sequence. Numbers must run consecutively within a financial year. Restarting mid-year, skipping numbers after a cancelled invoice, or running separate sequences from two different systems all cause problems at filing time. If you cancel an invoice, keep the number and issue a credit note — don't reuse it.
Getting place of supply wrong. This is the most expensive error. Charging CGST + SGST on what was actually an inter-state supply means your customer can't claim the credit, and you have to correct the return. For services, place of supply is generally the recipient's location if they're registered.
Missing or wrong HSN/SAC codes. How many digits you need depends on turnover. Getting the code itself wrong affects the tax rate applied.
Issuing it late. For goods, the invoice must be issued before or at the time of removal or delivery. For services, within 30 days of supply. An invoice dated after the fact is a problem in an audit.
Handwritten or spreadsheet invoices with no audit trail. Legal, but when GSTR-1 doesn't reconcile you have no way to find out why. This gets painful fast once you're issuing more than a handful a month.
A note on e-invoicing
If your aggregate turnover crosses the current threshold, B2B invoices must be reported to the Invoice Registration Portal and carry an IRN and QR code. An invoice without a valid IRN isn't a valid tax invoice at all — your customer cannot claim credit on it.
The threshold has been lowered repeatedly since e-invoicing was introduced. If you're near it, check the current figure rather than relying on what applied last year.
What to do about it
If you're issuing a few invoices a month, a careful spreadsheet works. Past that, the failure mode isn't usually one dramatic mistake — it's small inconsistencies accumulating until GSTR-1 doesn't reconcile and nobody can reconstruct why.
What actually helps: invoice numbers generated automatically so the sequence can't break, place of supply derived from the customer record rather than typed each time, HSN codes stored against each item, and every invoice retrievable later without digging through folders.
That's the reasoning behind Bill Clarity, our billing app for small businesses. But the principle matters more than the tool — whatever you use, the sequence and the place of supply are the two things worth getting structurally right rather than trusting to attention on a busy day.
For a practical starting point, create a GST invoice draft with the free GST invoice generator, check inclusive or exclusive amounts with the GST calculator, or compare the ready-made business software we adapt for billing workflows.
This is general information, not tax advice. GST rules change, and thresholds in particular have moved several times. Check the current position with your CA before relying on any of it.