What is the difference between CGST, SGST, and IGST?

CGST and SGST apply to intra-state sales (within the same state), splitting the GST equally. IGST applies to inter-state sales (between different states), charging the full GST rate as a single component.

Is a GST invoice mandatory for all businesses?

GST-compliant invoices are required for businesses registered under GST with an annual turnover above the threshold (40 lakh for goods, 20 lakh for services). Below this, registration and compliant invoicing are optional.

What is HSN and why is it needed on invoices?

HSN (Harmonized System of Nomenclature) is an international product classification code. GST-registered businesses with turnover above 5 crore must show 4-digit HSN codes on invoices for goods.

GST Invoice Format Guide — How to Create GST-Compliant Invoices in India

ToolsOfIndia.com Team · October 2026 · 6 min read

Since its introduction in 2017, GST has standardized invoicing across India. A GST-compliant invoice must include specific fields, tax splits, and numbering — failing to include any of these can lead to input tax credit (ITC) denial for your customers and penalties for you. This guide walks through every mandatory element and shows you how to create compliant invoices for free.

Mandatory Fields on a GST Invoice

The GST law requires the following fields on every tax invoice issued by a registered supplier:

Invoice number: A unique, sequential serial number (up to 16 characters) in the format of alphabet, numeral, or special characters.
Invoice date: The date of issue.
Supplier details: Name, address, and GSTIN of the seller.
Recipient details: Name, address, and GSTIN of the buyer (or the billing address if different from the shipping address).
Place of supply: The state where the goods or services are delivered — this determines whether CGST+SGST or IGST applies.
HSN/SAC code: Harmonized System code for goods or Service Accounting Code for services.
Item details: Description, quantity, unit of measurement, and unit price for each line item.
Tax amounts: CGST, SGST, and IGST broken down separately.
Total value: Total amount payable in figures and words.
Signature: Digital or physical signature of the supplier.

Understanding CGST, SGST, and IGST

The way GST is split depends on whether the sale is within the same state or across state lines:

Intra-State Sales (CGST + SGST)

When both the supplier and the recipient are in the same state, the GST is split equally into CGST (central) and SGST (state). For example, at 18% GST, a sale within Karnataka would have 9% CGST and 9% SGST.

Inter-State Sales (IGST)

When the supplier and recipient are in different states, the full GST rate is charged as IGST. For example, a sale from Karnataka to Maharashtra at 18% GST would have 18% IGST — no split.

GST Rate Slabs

India has four main GST rate slabs for goods and services:

0% — Essential items like fresh fruits, vegetables, and unbranded grains.
5% — Common necessities like edible oil, sugar, and packaged food.
12% — Processed foods, computers, and business class air travel.
18% — Most services, ACs, refrigerators, and hair oils.
28% — Luxury items like automobiles, tobacco, and aerated drinks.

Use the percentage calculator to quickly compute the tax amount for any GST slab.

Practical Example: Creating a GST Invoice

Suppose you run a hardware store in Delhi and sell to a customer in Delhi. The items are:

50 electrical switches at ₹40 each = ₹2,000
20 LED bulbs at ₹150 each = ₹3,000

Total before tax: ₹5,000. GST at 18% on electrical goods:

CGST (9%): ₹450
SGST (9%): ₹450
Total invoice: ₹5,900

If the same sale were to a customer in Rajasthan, it would be:

IGST (18%): ₹900
Total invoice: ₹5,900

The total is the same, but the tax split differs. The invoice generator handles this automatically once you enter the supplier and recipient states.

Invoice Numbering Rules

GST invoices must follow a strict numbering convention:

Must be unique within a financial year
Must be sequential (no gaps)
Can include letters, numbers, and hyphens (e.g., INV-2026-001)
Maximum 16 characters
Must not exceed a financial year — reset numbering on April 1

Common GST Invoice Mistakes

Missing or wrong GSTIN: Always verify the recipient's GSTIN format (two-digit state code followed by 10-digit PAN and one check digit).
Wrong place of supply: This leads to incorrect CGST/SGST vs IGST treatment, which is a common audit finding.
Non-sequential numbering: Skipping invoice numbers raises red flags during GST audits.
Missing HSN codes: Required for goods above the turnover threshold.
Amount in words missing: Use the number to words converter to fill this field accurately.

Conclusion

A GST-compliant invoice protects both you and your customers. Missing fields can block input tax credit and trigger penalties. Use the free invoice generator to create invoices with all mandatory fields, correct tax splits, and proper numbering — no software purchase required. For more on general billing, see our invoice generator guide for small businesses.