CS Professional · Goods and Services Tax (GST) and Corporate Tax Planning · Time of Supply
Sharma Traders, a registrant, supplies taxable goods (forward charge). The invoice is issued on 20 July, the last date for issuing the invoice under Section 31 is 25 July, and payment is received on 12 July. What is the time of supply?
The time of supply is 12 July, because under Section 12(2) the time of supply of goods on forward charge is the earlier of the invoice date or last invoice date, and the date of payment receipt. Payment on 12 July is earliest.
- A12 JulyCorrect
- B20 July
- C25 July
- DThe date of filing the return
Explanation
Under Section 12(2), the time of supply is the earlier of the invoice date (or last date for invoice) and the date of receipt of payment. Earlier of 20 July (invoice) and 12 July (payment) is 12 July. Choosing 25 July wrongly uses the latest date.
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