How to Create a GST Invoice in India: Step-by-Step Guide (2026)

What is a GST Invoice?

A GST invoice is a legal document issued by a registered business to a buyer when goods or services are sold. It is the primary record for both parties to claim input tax credit (ITC) and file GST returns. Getting it wrong — even a single field — can result in ITC rejection for your customer and notices from the GST department.

Who Must Issue a GST Invoice?

• Any GST-registered business selling goods or services
• Businesses with turnover above Rs 40 lakhs (goods) or Rs 20 lakhs (services)
• Businesses registered voluntarily under GST
• E-commerce sellers regardless of turnover

If your turnover is below the threshold and you are not registered, you issue a regular bill of supply — not a GST invoice.

Mandatory Fields on a GST Invoice

The GST Act specifies exactly what every tax invoice must contain:

1. Invoice number — sequential, unique per financial year (e.g., INV/2026-27/001)
2. Invoice date
3. Supplier name, address, and GSTIN
4. Recipient name, address, and GSTIN (for B2B; optional for B2C below Rs 2.5 lakh)
5. Place of supply — determines whether CGST+SGST or IGST applies
6. HSN/SAC code — mandatory above Rs 5 crore turnover; recommended for all
7. Description of goods or services
8. Quantity and unit
9. Taxable value (value before tax)
10. Tax rate and amount — CGST, SGST, or IGST separately
11. Total invoice value (including tax)
12. Signature or digital signature of the supplier

CGST vs SGST vs IGST — Which Applies?

This is the most common source of errors. The rule is simple:

• Intra-state sale (supplier and buyer in same state): Charge CGST + SGST, each at half the GST rate. Example: 18% GST = 9% CGST + 9% SGST.
• Inter-state sale (supplier and buyer in different states): Charge IGST at the full GST rate. Example: 18% GST = 18% IGST.
• Export: Zero-rated. Charge 0% with a declaration on the invoice.

The "place of supply" field determines which applies — not the billing address, but where the goods are delivered or service is consumed.

HSN and SAC Codes

HSN (Harmonised System of Nomenclature) codes classify goods. SAC (Services Accounting Code) codes classify services. Both are required on invoices based on your annual turnover:

• Up to Rs 5 crore: 4-digit HSN code (optional but recommended)
• Above Rs 5 crore: 6-digit HSN code mandatory
• Exporters: 8-digit HSN code required

Using the wrong HSN code is a common audit trigger. When in doubt, check the CBIC HSN search tool.

Invoice Numbering Rules

GST rules require invoices to be numbered sequentially within a financial year. Key rules:

• Numbers must be consecutive — no gaps allowed
• Alphanumeric is allowed (e.g., INV/2026-27/001)
• Maximum 16 characters
• Series resets each financial year (April 1)
• You can have separate series for different branches or types (B2B, B2C, export)

Non-sequential numbering is one of the top reasons for GST scrutiny. Billing software handles this automatically.

Time Limit to Issue Invoice

• Goods: Before or at the time of delivery
• Services: Within 30 days of service completion
• Banking and insurance: Within 45 days
• Continuous supply of services: On each due date of payment

Step-by-Step: Creating a GST Invoice in InfiBis

1. Go to Invoices → Create Invoice
2. Select or add the customer — GSTIN auto-fills name and address
3. Add line items — HSN/SAC codes auto-populate from your product catalogue
4. InfiBis automatically applies CGST+SGST or IGST based on place of supply
5. Review the total and click Save & Share
6. Send via WhatsApp, email, or print — all from the same screen

The entire process takes under 60 seconds. Stock deducts automatically. The invoice is ready for GSTR-1 export.

Common Mistakes to Avoid

• Wrong place of supply — leads to wrong tax type (CGST/SGST vs IGST)
• Missing GSTIN for B2B invoices — customer cannot claim ITC
• Incorrect HSN code — can attract notices and penalties
• Non-sequential invoice numbers — red flag in GST audits
• Not issuing credit notes for returns — must be linked to original invoice
• Issuing invoice after time limit — late invoices can be rejected in GSTR-2A reconciliation

Credit Notes and Debit Notes

When goods are returned or a price revision happens after invoicing:

• Credit note: Issued by supplier when reducing the invoice value (returns, discounts)
• Debit note: Issued by supplier when increasing the invoice value (price revision upward)

Both must reference the original invoice number and be reported in GSTR-1.

Conclusion

A correct GST invoice protects both you and your customer. The mandatory fields, tax type selection, and sequential numbering are non-negotiable. InfiBis handles all of this automatically — so you focus on the sale, not the paperwork. Also see our guide on choosing the right GST billing software for your business.