Difference between bill of supply & tax of invoice?
In the realm of billing software, understanding the disparity between a Bill of Supply and a Tax Invoice is crucial. On the contrary, a Tax Invoice is a comprehensive document that includes the applicable tax on the transaction. Knowing the distinction ensures accurate financial records, compliance, and seamless transactions in the digital billing landscape.
- Bill of supply is used for exempted item
- Tax of invoice is used for taxable items
Input Tax Credit (ITC)
Bill of Supply
|A document used for GST-exempt supplies or supplies by a composition dealer.|
Applicable for GST-exempt supplies or composition dealers.
No tax is calculated or mentioned in a Bill of Supply.
Recipient cannot claim ITC on purchases made using a Bill of Supply.
Used for supplies like fruits, vegetables, and other GST-exempt items.
Contains details of the supplier, recipient, and description of goods/services.
Generally used by small businesses or businesses dealing with exempt goods.
Not mandatory for the supplier in the case of a Bill of Supply.
|A document used for taxable supplies under GST.|
Applicable for taxable supplies under GST.
Tax amount is calculated and mentioned separately for each taxable item.
Recipient can claim ITC on purchases made using a Tax Invoice..
Used for supplies of goods and services where GST is applicable.
Contains detailed information about the supplier, recipient, GSTIN, and HSN code of goods/services.
Mandatory for registered businesses making taxable supplies..
Mandatory for the supplier in the case of a Tax Invoice.