Time, Value and Place of Supply: formula sheet

Key formulas

Forward charge: time of supply of goods (Section 12(2))

Time of supply = earlier of (a) date of issue of invoice, or last date on which invoice is required to be issued under Section 31; and (b) date on which supplier receives payment

Applies to the extent covered by the invoice or the payment. Supply is deemed made to that extent (Explanation 1).

Date of receipt of payment (Section 12(2), Explanation 2)

Date of payment = earlier of (date entered in supplier's books) and (date credited to supplier's bank account)

Use the earlier of the two dates, not the cheque date or the date of dispatch.

Excess payment up to ₹1,000 (proviso to Section 12(2))

If supplier receives up to ₹1,000 more than the invoice amount, time of supply for that excess = date of invoice for the excess, at the supplier's option

Applies only to excess amount up to ₹1,000, and it is the supplier's option.

Reverse charge: time of supply of goods (Section 12(3))

Time of supply = earliest of (a) date of receipt of goods; (b) date of payment as entered in recipient's books or date debited in recipient's bank account, whichever is earlier; (c) date immediately following 30 days from the date of supplier's invoice or equivalent document

If none of (a), (b), (c) can be determined, the date of entry in the recipient's books applies.

Vouchers (Section 12(4))

Date of issue of voucher if supply is identifiable at that point; otherwise date of redemption

Applies to supply of vouchers by a supplier.

Residual rule (Section 12(5))

If time cannot be determined under sub-sections (2), (3) or (4): date on which the periodical return is to be filed, or in any other case the date on which tax is paid

Use only as a last resort.

Interest, late fee or penalty (Section 12(6))

Time of supply for the addition in value = date on which supplier receives such addition

Covers amounts charged for delayed payment of consideration.

Forward charge - Section 13(2)

Invoice issued within Section 31 period: earlier of (date of invoice, date of receipt of payment). Invoice not issued within that period: earlier of (date of provision of service, date of receipt of payment).

If neither applies, the date the recipient shows receipt of services in his books is the time of supply. Supply is deemed made only to the extent covered by the invoice or payment.

Date of receipt of payment

Earlier of (date entered in supplier's books, date credited to supplier's bank account)

Applies for forward charge. Use the earlier date, not the later.

Excess receipt up to ₹1,000

Excess amount up to ₹1,000 over the invoice: time of supply, at supplier's option, is the date of invoice for that excess

The option belongs to the supplier. It applies only to the excess, not the whole invoice.

Reverse charge - Section 13(3)

Earlier of (a) earlier of payment entered in recipient's books or debited in his bank; (b) day after 60 days from supplier's invoice, where supplier must issue invoice; (c) date of invoice issued by recipient, where recipient must issue invoice

If it cannot be fixed, it is the date of entry in the recipient's books. Clause (c) was added from 1-11-2024.

Associated enterprises, supplier outside India

Earlier of (date of entry in recipient's books, date of payment)

Applies under reverse charge when the supplier of service is located outside India and the parties are associated enterprises.

Vouchers - Section 13(4)

Supply identifiable at issue: date of issue of voucher. Otherwise: date of redemption of voucher

Same rule as for goods.

Residual rule - Section 13(5)

Periodical return required: date on which the return is to be filed. Otherwise: date on which tax is paid

Used only when sub-sections (2), (3) and (4) cannot fix the date.

Interest, late fee, penalty - Section 13(6)

Date on which the supplier receives the addition in value

Applies to the extra amount charged for delayed payment of consideration.

Supply before the change: both invoice and payment after

Time of supply = earlier of date of invoice and date of receipt of payment

Section 14(a)(i). Both events fall after the change, so the new rate applies.

Supply before the change: invoice before, payment after

Time of supply = date of issue of invoice

Section 14(a)(ii). The invoice falls before the change, so the old rate applies.

Supply before the change: payment before, invoice after

Time of supply = date of receipt of payment

Section 14(a)(iii). The payment falls before the change, so the old rate applies.

Supply after the change: payment after, invoice before

Time of supply = date of receipt of payment

Section 14(b)(i). The payment falls after the change, so the new rate applies.

Supply after the change: invoice and payment both before

Time of supply = earlier of date of receipt of payment and date of issue of invoice

Section 14(b)(ii). Both fall before the change, so the old rate applies.

Supply after the change: invoice after, payment before

Time of supply = date of issue of invoice

Section 14(b)(iii). The invoice falls after the change, so the new rate applies.

Date of receipt of payment

Earlier of date entered in books and date credited to bank

Explanation to section 14. Proviso: if the bank credit is after four working days from the date of change in rate, the date of receipt is the date of bank credit.

Transaction value

Value of supply = price actually paid or payable

Applies when supplier and recipient are not related and price is the sole consideration (section 15(1)).

Taxable value

Taxable value = price + section 15(2) inclusions − eligible discounts (section 15(3))

Include only what the law lists. GST itself is never part of the value.

Inclusions under section 15(2)

(a) other-law taxes/duties charged separately; (b) supplier's liabilities paid by recipient; (c) incidental expenses; (d) interest, late fee, penalty; (e) price-linked subsidies except Government subsidies

Learn as a five-item list.

Post-supply discount conditions

Agreement at or before supply + linked to invoices + recipient reverses ITC

All three conditions must be met. Discount at or before supply needs only to be recorded in the invoice.

GST amount

GST = taxable value × rate of tax

Rate is applied on value after adjustments.

Rule 27: consideration not wholly in money

Value = open market value; else money consideration + money equivalent of non-money consideration (if known); else Rule 30 or 31

Apply the options in this order. Barter and part-in-kind deals fall here.

Rule 28: distinct or related persons (not through an agent)

Value = open market value; else value of like kind and quality; else Rule 30; else Rule 31

Under the first proviso to Rule 28(1), where the goods are intended for further supply as such by the recipient, the value is, at the option of the supplier, 90% of the price charged for goods of like kind and quality by the recipient to his customer who is not a related person. Under the second proviso, where the recipient is eligible for full input tax credit, the value declared in the invoice is deemed to be the open market value. The 90% option is an alternative to the open market value, like-kind and cost steps.

Rule 29: goods supplied through an agent

Value = open market value, or 90% of the price charged by the agent to the customer (at the supplier's option); else Rule 30 or 31

Applies where the agent supplies goods on behalf of the principal.

Rule 30: cost method

Value = 110% × (cost of production or manufacture, or cost of acquisition, or cost of provision of services)

Use only when open market value and like-kind value are unavailable.

Rule 31: residual method

Value = determined by any reasonable means consistent with section 15 and the Rules

Last resort. Not a licence to pick any figure; it must be reasonable and consistent with the principles of valuation.

Rule 32(2): money changing

Option 1: Value = (buying or selling rate − RBI reference rate) × total units of currency. Option 2: slab-based amount on the gross amount of currency exchanged.

The supplier chooses between the two. The slab-based amount applies where the RBI reference rate is not available or the supplier does not use it. Check the Rule for the slabs.

Rule 33: pure agent

Value excludes expenditure incurred as a pure agent and recovered at actual cost

All the conditions of the Rule must be met. Fail one and the expense joins the value.

Rule 34: exchange rate

Rate of exchange = applicable reference rate for that currency announced by the RBI, or as per generally accepted accounting principles, for the date of the time of supply under section 12 or 13

Applies where the invoice value is in foreign currency. Fix the date by the time of supply, not by invoice or payment date. Then take the RBI reference rate (or the rate under generally accepted accounting principles) for that date.

Rule 35: tax-inclusive price

Tax amount = (tax-inclusive value × tax rate in % of IGST or CGST + SGST) ÷ (100 + sum of tax rates, as applicable). Then value = tax-inclusive price − tax amount.

Sum of the rates means CGST + SGST, or IGST, plus cess if any.

Goods moved

Place of supply = location where movement of goods terminates for delivery to the recipient

IGST Act, section 10. This is the general rule for supplies involving movement, whether by the supplier, the recipient or any other person.

Bill to ship to

Delivery to a third person on the direction of the buyer → place of supply = principal place of business of the buyer who gave the direction

The buyer is deemed to have received the goods. The third person is ignored for this supply.

Goods not moved

Place of supply = location of the goods at the time of delivery to the recipient

Applies where there is no movement, for example goods lying in a warehouse and sold as they are.

Assembly or installation at site

Place of supply = place of installation or assembly

Applies when the goods are assembled or installed at the site.

Goods on board a conveyance

Place of supply = location at which the goods are taken on board

Conveyance means a vessel, aircraft, train or motor vehicle.

Imports and exports

Import: place of supply = location of the importer. Export: place of supply = location outside India

IGST Act, section 11. Both are inter-State supplies, so IGST applies.

Intra-State or inter-State

Supplier's location and place of supply in the same State/UT → CGST + SGST/UTGST. Different States/UTs → IGST

The supplier's location is the starting point. The place of supply is the second point of comparison.

Which section applies

Supplier and recipient both located in India → IGST Act Section 12. Supplier or recipient located outside India → IGST Act Section 13

Decide this first. Quote the correct Act and section in your answer.

General rule: Section 12 (registered recipient)

Place of supply = location of the recipient

Applies where the service is supplied to a registered person and no special rule fits.

General rule: Section 12 (unregistered recipient)

Place of supply = location of recipient where address is on record; otherwise location of supplier

The supplier's location is the fallback only when no recipient address is on record.

General rule: Section 13

Place of supply = location of the recipient; if that is not available in the ordinary course of business, location of the supplier

Applies when the supplier or the recipient is outside India and no exception fits.

Immovable property services

Place of supply = where the immovable property is located or intended to be located

Covers services such as architects, interior designers, estate agents and hotel or lodging accommodation. Boats and vessels are treated the same way.

Restaurant, catering, personal grooming, fitness, beauty and health services

Place of supply = where the services are actually performed

Section 12 special rule. It applies whether or not the recipient is registered.

Training and performance appraisal (Section 12)

Registered recipient → location of recipient. Unregistered recipient → where services are actually performed

Do not mix this with the restaurant rule, which has no registered/unregistered split.

Admission to events

Place of supply = where the event is actually held

Covers cultural, artistic, sporting, scientific, educational and entertainment events, and amusement parks.

Transportation of goods (Section 12)

Registered recipient → location of recipient. Unregistered recipient → place where the goods are handed over for transportation

Mail and courier services are treated differently. Check the Act for them.

Passenger transportation (Section 12)

Registered recipient → location of recipient. Unregistered recipient → place where the passenger embarks on the conveyance

Services on board a conveyance are supplied at the first scheduled point of departure of that conveyance.

Telecommunication services (Section 12)

Fixed line, leased circuit, cable or dish antenna → location of installation. Post-paid mobile → billing address. Pre-paid → where recharge is made or point of sale

Learn the three cases separately.

Banking, financial and insurance services (Section 12)

Banking and financial services → location of recipient on record, else location of supplier. Insurance → registered recipient: location of recipient; otherwise location of recipient on record

Always check whether the recipient is registered.

Quick revision

• Section 14 applies notwithstanding sections 12 and 13 when the rate of tax changes.
• Date of receipt of payment is the earlier of the date entered in the books and the date of credit in the bank account.
• Under the proviso to section 14, if the bank credit comes after four working days from the date of rate change, the credit date is the date of receipt.
• Transaction value is the price actually paid or payable when the parties are not related and price is the sole consideration.
• Taxes under other laws are added to value if charged separately, but not CGST, SGST, UTGST or the Compensation Cess Act levy.
• Incidental expenses such as commission and packing charged by the supplier are included in value.
• Interest, late fee or penalty for delayed payment is included in value.
• Subsidies directly linked to price are included, but not those given by the Central or State Governments.
• A discount is excluded if recorded in the invoice at or before supply; a later discount also needs an agreement linked to invoices and ITC reversal by the recipient.
• Persons holding 25% or more of the voting stock of both are related persons.
• If transaction value cannot be used, the value is found as prescribed in the valuation rules.
• Place of supply decides whether the supply is intra-State or inter-State, and so which tax applies.

Common mistakes

• Taking the actual date of delivery as the time of supply even when an invoice or payment came earlier. Fix: Remember the rule is the earlier of invoice date (or due date for invoice) and payment date. Delivery matters only because it fixes the last date for the invoice.
• Using the date the invoice was actually issued when it was issued late. Fix: The text also says 'or the last date on which he is required to issue the invoice under Section 31'. A late invoice does not push the time of supply later.
• Using the invoice date even when the invoice was issued late. Fix: For services, if the invoice is late, compare the date of provision of service with the payment date.
• Using 30 days for reverse charge on services. Fix: Remember: goods 30 days, services 60 days, and the time of supply is the day immediately following that period.
• Applying the rate on the date of supply only Fix: Section 14 decides by invoice and payment dates as well. Always list all three dates before choosing the rate.
• Mixing up clause (a) and clause (b) Fix: First decide whether the supply is before or after the change. Then pick the clause. Use the quick check to verify your result.
• Adding GST or Compensation Cess to the value Fix: Section 15(2)(a) covers taxes under other laws only. It excludes CGST, SGST, UTGST and Compensation Cess.
• Deducting every post-supply discount Fix: A post-supply discount is excluded only if agreed at or before supply, linked to invoices, and ITC is reversed by the recipient.
• Jumping straight to cost plus 110% for related-party supplies. Fix: Always check open market value and like-kind value first. Use Rule 30 only if the question says these are not available.
• Treating all reimbursed expenses as pure agent expenses. Fix: Check every condition of Rule 33 before excluding the amount: - The supplier acts as a pure agent under a contract with the recipient to procure the goods or services. - The recipient authorises the supplier to make the payment to the third party, is liable to pay for them, and receives and uses them. - The goods or services procured are in addition to the services the supplier supplies on his own account. - The payment is separately indicated in the invoice. - The supplier recovers from the recipient only the actual amount paid to the third party. If any condition fails, add the amount to value.

Exam tips

• Always state the section: Section 12(2) for forward charge and Section 12(3) for reverse charge. ICSI-style answers carry the provision, analysis and conclusion.
• In numerical problems, show each date with its label (invoice, payment, receipt) before choosing, so partial marks are secured.
• Watch for traps: late invoices, advances, part payments and payments of ₹1,000 or less above the invoice amount.
• Check whether the question gives goods or services. The 30-day limit applies to goods and the 60-day limit to services under reverse charge.
• Link to Section 31: if the invoice date is not given, work out the last date for invoice from removal or delivery.
• Begin every answer with the provision: say Section 13 and the sub-section that applies, then the facts, then the conclusion.
• Draw a small timeline of dates. It helps you avoid picking the wrong one and shows the examiner your reasoning.
• Learn the contrasts with goods: Section 12(2)(a) uses the last date for invoice, while 13(2) splits on whether the invoice is in time; and 30 days vs 60 days under reverse charge.