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Concept of Debit Note, Credit Note and Revised Invoices in GST

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Concept of Debit Note, Credit Note and Revised Invoices in GST ...

GST came into effect from 1st July, 2017 onwards. With the implementation of Goods and Service Tax all other indirect taxes including VAT, service tax, CST, entry tax, etc. have been repealed. Unlike older indirect taxes, GST is one tax that is applicable on the whole of India including the state of Jammu and Kashmir. While filing GST returns, taxpayers have to provide details of sales and purchases on which tax liability and input tax credit will be calculated and ascertained. We learn here Concept of Debit Note, Credit Note and Revised Invoices in GST.

Under GST Act, format for invoices has been provided wherein taxpayers have to mandatorily furnish certain details like GST Number, name of supplier, billing address, shipping address, place of supply, HSN code, rate, quantity etc. Since all the relevant details available on invoices of sellers there will surely be more transparency and ease in filing returns.

Revised invoices under GST

The concept of revised invoices is relevant for taxpayers having provisional registration under GST. With roll-out of GST new taxpayers will initially be registered on a provisional basis. Permanent registration certificate will only be granted upon completion of all kinds of formalities. All the invoices issued from the date of implementation of GST till the date of allotment of registration number must be revised within one month of receipt of registration certificate.

The dealers will have to mandatorily issue revised invoices that will contain all the necessary information as stated in GST Invoices Rules.

Supplementary invoices

Supplementary invoices are advices issued whenever original tax invoices have some discrepancy or deficiency. Under GST, if an original invoice misses out on relevant information it is revised through the issue of a supplementary invoice. The revision can also be done through issue of debit or credit notes.

Taxpayers must not confuse revised invoices with supplementary invoices, even though both are issued  to revise original invoices. Supplementary invoices are issued in case of deficiency in an original invoice and can be issued anytime to revise it whereas revised invoices are only issued in case of provisional registration and are issued within one month of getting registration certificate.

While supplementary invoices are issued to curb deficiencies, revised invoices are issued to replace bills generated during provisional registration period. 

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Credit note under GST

Credit note under GST is issued by the supplier to revise tax invoice in the following cases :

  • When original tax invoice has been issued but the actual value of taxable goods or services supplied is lesser than the value mentioned in the invoice.
  • Where original tax invoice has been issued and the amount of tax mentioned in it is more than the actual tax that is required to be paid.
  • When goods are returned by the buyer to the supplier.
  • When actual services supplied are deficient.

Every taxpayer must furnish details of credit note issued in his monthly GST returns in the same month it is issued in. Moreover, credit notes must be issued on or before 

  • The date of annual return filing; or
  • 30th September following the year to which credit notes pertain to

whichever is earlier.

Debit note under GST

Unlike credit notes, debit notes under GST do not come with any deadline. They can be issued anytime. This is because the credit note issued by the supplier will naturally match the debit note of the recipient. Debit notes are issued under following circumstances, viz.

  • When the value of taxable services and/ or goods mentioned in the tax invoice changes post issuance.
  • Tax liability mentioned in the original tax invoice changes post issuance of the invoice.

Debit as well as credit notes must contain all the essential details as asked under GST Invoice Rules.

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