Implementation of GST Tax Invoicing for India

[scatternet-tech]

Hi,

In India, VAT is replaced with GST in the year 2017. Since then there has been only one type of TAX ie., GST.

Under GST, a product can be taxed at 0% or 5% or 12% or 18% or 28%.

If the Invoice billing is happening between the two firms which are located in different states/provinces, then the full GST amount should be marked as IGST.

If the Invoice billing is happening between the two firms which are located in the same state/province, then 50% of the GST amount should be marked as CGST and the remaining 50% as SGST.

State/Province is identified from the first two characters of the GST number.
Refer to the below link calculation details:
https://taxadda.com/calculators/gst-calculator

This is a basic requirement in India for Tax invoicing. It is becoming very difficult for us to use Invoice Ninja without GST implementation. Especially when Invoicing is to be done for products with mixed tax rates and located in the same state/province.

Request the Invoice Ninja team to implement the same at the earliest. I will be more than happy to answer more queries regarding the same.

Thanks,
Hari

[turbo124]

@scatternet-tech

Thanks for the detailed information this is helpful.

Can you advise whether it is mandatory for the assignment of CGST and SGST to be displayed on the invoice itself?

The tricky part from our side would be for example:

100 @ 5% tax

This would result in a tax amount of 5 which would then need to be shown as

2.5 CGST
2.5 SGST

Would it be acceptable to create a tax label

CGST 2.5% - $2.50
SGST 2.5% - $2.50

We'd then be able to build a ruleset for India, however, for this to work we'd need to understand quite a bit more about the rules around India and whether these rules are uniform across all states.

[scatternet-tech]

Hi,

Thanks a lot for your attention on this.

"Can you advise whether it is mandatory for the assignment of CGST and SGST to be displayed on the invoice itself?"

Yes. It is mandatory to display IGST or CGST-SGST in the invoice, along with individual product tax rates.

Sample Invoice for an Interstate Transaction(IGST):

Sample Invoice for an Intrastate Transaction(SGST-CGST):

Would it be acceptable to create a tax label
CGST 2.5% - $2.50
SGST 2.5% - $2.50

The above Tax labels are ok if all the products in the invoice are of the same tax rate. But, when there are multiple products with different tax rates, then it doesn't look right.

First, there should be a provision to select the tax rate for every individual product.
Second, Calculate the Total net Tax.
Third, Mark the Total net Tax as IGST or SGST-CGST.

We'd then be able to build a ruleset for India, however, for this to work we'd need to understand quite a bit more about the rules around India and whether these rules are uniform across all states.

GST rules are the same across the country.
There are other things like reverse charges etc under GST, which are very rarely used. Hence, it is not discussed here. I would say 99.9% of the invoices will be the normal GST invoice type(which we are discussing now).

Please let me know if you have any questions.

[turbo124]

This is the tricky part here. There is no logic that supports splitting a tax down into two components from a single tax rate.

The only way I can think of that this could be supported would be by using a twig template to display the split data using some conditional logic.

[scatternet-tech]

Can we implement this logic under the "Auto Tax" feature specific to India?

[turbo124]

Hi There,

Yes, the tax calculation is the easy part. The only difficulty would be the display of the split tax data - but this could be managed if using a custom design implemente with a Twig Template.

[scatternet-tech]

Looks Good.
Can you suggest the changes required in the custom invoice template?

[turbo124]

@scatternet-tech

The twig engine is pending release. but once it is released, you'll be able to use conditions to display the tax data as needed on the final PDF.

[scatternet-tech]

When is it expected to be released(tentatively)?

Meanwhile, please create the required custom tax labels for computing IGST, CGST and SGST. I will use two separate custom invoice templates for Inter and intra-state invoices.