1. Localizations for India Implementation Guide
  2. Understanding Tax Invoices for India

Understanding Tax Invoices for India

A tax invoice is a legal document that contains information that is required by Indian tax authorities and complies with the regulatory obligations. A tax invoice consists of tax assessments for excise, sales, and service tax, as well as value-added tax (VAT), tax collected at source (TCS), and works contract tax (WCT). The laws in India do not require that you print tax invoices in a specific format; however, they do require that certain information prints on the invoice. Some of the legally required fields on the invoice include the running serial number, the name, address and registration number of the seller and of the purchaser, the date of issue, and the total invoice amount in words.

Excise duty elements such as basic excise duty (BED) (Cenvat), special excise duty (SED), additional excise duty (AED), and Education cess (CESS) on excise must print on the invoice in amounts and in words. Optionally, you can print the total excise duty amount (in words), instead of printing amounts for each excise tax type.

The format of a tax invoice is based on whether the document is generated by a dealer or a manufacturer. Tax invoices generated by a dealer require the dealer format.

For the dealer format, the origin of the goods must print on the invoice. The dealer must track the excise duty amounts that are calculated by the manufacturer. The following information must print at the line level on the tax invoice:

  • First Stage Dealer

    Print the manufacturer details for tax invoice number, excise registration number, and excise tax duty paid.

  • Second Stage Dealer

    Print the manufacturer details for manufacturer tax invoice number, excise registration number, and excise tax duty paid, as well as the First Stage Dealer details (tax invoice number, excise registration number, and excise tax duty paid).

The line amount that an excise-registered dealer charges includes the excise duty. The excise-registered dealer issues an excise tax invoice for the duty paid on goods so that the buyer can claim Cenvat credit.