Implement 2017 GST scheme for India

In mid-2017, India introduced a new GST scheme with several unique requirements for invoices. Manager can handle this scheme, but several steps are required by the user. No custom theme is necessary.

Below is an example of a sales invoice you can generate in Manager:

This invoice contains two different tax codes. The amounts are tax-exclusive, which means taxes are added to the sub-total. Other variations are supported, too.

HSNs and tax rates applied in examples in this Guide are for illustration only. They are not necessarily correct for product types shown.

Here are instructions you must follow to properly implement Indian GST.

Date and number formats

While these are optional, typical Indian date and numbering preferences can be selected in the Settings tab by clicking on Date & Number Format and choosing from options in the dropdown menu:

HSN column

Set up for showing HSN in one or both of two ways:

  • Free-text custom fields for line items. This method by itself is simplest, but forces you to enter the HSN on every line item. It is most useful when your line items vary from one transaction to another and do not include inventory items.
  • Pre-defined custom fields for inventory items or non-inventory items. This method takes longer to set up, but saves time when entering line items. It is not well suited when line items frequently change.

The two methods can be combined on a single form. HSNs entered by either method will show in a single column. Setup instructions for both methods follow.

Custom fields for line items

To add the capability to include HSN in a line item, go to Settings Custom Fields and find the list for XXXXXXXX - Line, where XXXXXXXX is the name of the form on which you want HSN to show. (Illustrations below are for sales invoices.) Click New Custom Field:

Name the field HSN and check the box to Show custom field on printed documents:

Click Create. When entering line items, the HSN field will appear:

Custom fields for inventory items or non-inventory items

To show the same HSN every time an inventory item or non-inventory item is added to an invoice, define a custom field for Inventory Items or Non-Inventory Items (or both, if necessary) under Settings Custom Fields. Mark the custom field to show both as a column and on printed documents:

When a custom field, HSN, is created like this, you can then set the HSN value for your inventory items (in the Inventory Items tab) and non-inventory items (under Settings Non-Inventory Items):

When items with HSNs are used on invoices, the numbers will automatically show in the HSN column:

An HSN defined for an inventory or non-inventory item will not appear on the transaction entry screen. But it will appear when viewing the completed transaction form.

If you do not define the HSN for an inventory or non-inventory item, it will not appear on the completed document, because the custom field will be blank.

If you define a line-item custom field for HSN, that field will appear when entering relevant transactions. It will be blank, even though you may have defined an HSN for an inventory or non-inventory item entered. This is because you will be viewing the line-item custom field, not the item’s custom field. However, an entry in the visible, line-item field will overwrite any defined entry in the item’s custom field. This feature allows you to correct erroneous HSNs without editing the inventory or non-inventory item definition.

GSTIN identifiers

Your own GSTIN identifier can be entered under Settings Business Details in the Address field:

GSTIN identifiers for customers can be entered when defining them in the Customers tab:

When a business identifier is entered, it will show on completed transactions under contact details like this:

Tax codes

Tax codes must be defined for all jurisdictions where you do business so they can be chosen on transactions. See this Guide for instructions on defining custom tax codes. In most cases, Indian tax codes will be multi-component:

Tax codes will show as a column for every line item where one is selected:

Some invoice examples for the Indian tax scheme on the Internet show tax amounts being individually calculated on each line item, but this is not legally required. What is important is to show the correct tax name for each line item, such as CGST + SGST 18%.

Legal requirements are to show totals for each tax code. This is what you should see in Manager:

Or if you are issuing invoices where amounts are tax-inclusive, you will see:

Invoice heading

When charging GST on sales invoices, the invoices must say Tax Invoice. There are three ways you can implement that requirement:

  • Manually change the title on an individual sales invoice entry screen by checking the box for Custom title and entering the text Tax Invoice:

  • Do the same thing for all sales invoices under Form Defaults in the Settings tab. (This will affect sales invoices without any tax codes.)
  • Do the same thing when defining your custom tax codes. This option is preferred for most situations, because the title change will occur automatically, but only when tax codes are applied:

With any of these options, the result is to replace the title on completed sales invoices:

Total amount in words

Common Indian practice adds the total invoice amount in words. Do this by checking the box on the sales invoice entry form:

The result appears near the bottom of the invoice:

This guidance does not rely on custom themes. Custom themes are meant to vary presentation, not meet legal requirements. The advantage of this approach is that you are still free to use any of the built-in themes. None of those themes incorporate anything about Indian GST requirements, but you will still have everything in place.

Below is the same invoice as in the first example above, but shown in a different theme. No additional coding or setup was necessary:

Subscribe to Updates

Subscribe to our newsletter and get exclusive product updates you won't find anywhere else straight to your inbox.

© 2022 — Based in Sydney, Australia but providing goodness globally