How to Create a GST-Compliant Invoice (And What Happens If You Don't)

If you're a registered GST taxpayer in India, every invoice you raise for a B2B transaction is a legal document. Get it wrong and your buyer can't claim their input tax credit — which means they'll ask you to fix it, or stop doing business with you.

Here's exactly what a GST-compliant invoice must contain, and why each element matters.

The mandatory fields

Supplier details: your legal name, registered address, and GSTIN. This is how the government links the invoice to your GST registration.

Buyer details: the buyer's name, address, and GSTIN if they're a registered business. If the buyer is unregistered, their address is sufficient.

Invoice number and date: under Rule 46(b) of the CGST Rules, the invoice number must be a consecutive serial number, unique within a financial year, no more than 16 characters long, and made up only of letters, numbers, hyphens and slashes. Within those limits the scheme is yours to choose — but once a sequence starts, you cannot reuse or skip numbers.

HSN/SAC code: for goods, this is the Harmonised System of Nomenclature code. For services, it's the Service Accounting Code. The number of digits depends on your aggregate turnover in the preceding financial year: up to ₹5 crore — 4 digits, mandatory on B2B supplies and optional on B2C. Above ₹5 crore — 6 digits on all supplies. For exports and imports, 8 digits.

Quantity and unit: for goods, specify the quantity and unit of measurement. For services, describe the nature of the service.

Taxable value: the value before GST.

GST breakdown: this is where most people get it wrong.

CGST/SGST vs IGST — the rule that determines your tax split

The split depends on whether the transaction is intra-state or inter-state.

Intra-state means the supplier and buyer are in the same state. In this case, you charge CGST (Central GST) and SGST (State GST), each at half the applicable rate. So for an 18% GST transaction: 9% CGST + 9% SGST.

Inter-state means the supplier and buyer are in different states. In this case, you charge IGST (Integrated GST) at the full applicable rate. So for the same 18% transaction: 18% IGST.

The "place of supply" field on the invoice determines which rule applies. For services, place of supply is usually the location of the recipient. For goods, it's typically where the goods are delivered.

What happens if you get it wrong

Wrong tax split (e.g. charging CGST/SGST on an inter-state transaction): the buyer cannot claim the ITC correctly, the government's reconciliation fails, and both parties may receive a notice.

Missing GSTIN: the buyer's GST portal won't match the transaction to their account. Their ITC claim fails.

Wrong HSN code: penalties under GST law, and potential scrutiny during audit.

The correct approach: use software that handles the CGST/SGST/IGST split automatically based on the supplier and buyer states, and validates HSN codes against the official list.

Dewmor issues GST-compliant invoices for your own subscription, with GSTIN capture, place of supply and the correct CGST/SGST or IGST split. It is not a billing product for invoicing your clients — for that you need dedicated accounting software.