Time of Supply determines the exact point when GST liability triggers — which tax period to report, which rate to apply, and when tax must be paid. Sections 12–14 of CGST Act cover goods, services, reverse charge, and rate change scenarios with specific rules for each.
Time of Supply: Earlier of: (i) date of issue of invoice, or (ii) last date on which invoice is required to be issued
Example: Invoice issued on 15 March for goods removed on 10 March → Time of supply = 15 March (invoice date)
Time of Supply: Earlier of: (i) invoice date, or (ii) date of receipt of payment
Example: Payment received 1 April, invoice issued 5 April → Time of supply = 1 April (payment earlier)
Time of Supply: Date of issue of invoice or payment — whichever is earlier. If invoice not issued by due date: date of receipt of payment
Example: Steel supply contract with monthly invoicing — if invoice due 30 April, issued 5 May → Time of supply = 30 April (due date)
Time of Supply: Earlier of: (i) date of approval/acceptance, or (ii) 6 months from date of removal
Example: Goods sent on approval 1 Jan, approved 1 March → Time of supply = 1 March. If not returned/approved by 1 July → deemed supply on 1 July
Time of Supply: Earliest of: (i) date of receipt of goods, (ii) date of payment, (iii) 30 days from date of invoice by supplier
Example: Purchase from unregistered dealer: goods received 10 May, payment 20 May → Time of supply = 10 May
Time of Supply: Earlier of: (i) date of invoice, or (ii) date of receipt of payment
Example: Service completed 1 April, invoice issued 15 April → Time of supply = 15 April
Time of Supply: Earlier of: (i) date of provision of service, or (ii) date of receipt of payment
Example: Consulting completed 1 March, no invoice until 15 April → Time of supply = 1 March (service date)
Time of Supply: Earlier of: (i) date of invoice (or 45 days from provision), or (ii) payment date
Example: Banks get 45-day invoice window instead of 30 days
Time of Supply: Date on which payment is due as per contract
Example: SaaS subscription due on 1st of every month → Time of supply = 1st of each month
Time of Supply: Date of receipt of payment
Example: Ongoing IT support with no fixed invoice schedule → Time of supply = each payment date
Time of Supply: Earliest of: (i) date of payment, (ii) 60 days from date of invoice by supplier
Example: Legal service from advocate: invoice 1 March, payment 1 May → Time of supply = 1 May (60 days = 30 April, payment 1 May is later so 30 April)
Time of Supply determines WHEN the GST liability arises — i.e., in which tax period (month/quarter) the transaction must be reported and tax paid. Getting it wrong means either early payment of tax (cash flow impact) or late payment (interest at 18% p.a. under Section 50). It also determines the applicable GST rate if rates change between transaction events.
For goods involving movement: invoice must be issued before or at the time of removal. For goods without movement: invoice must be issued before or at the time of delivery. For continuous supply of goods: invoice before or at the time of each milestone/statement of account. Late invoicing changes the time of supply calculation.
For services, the invoice must be issued within 30 days of completion of service (45 days for banking/financial services). If the invoice is issued within this window, Time of Supply = earlier of invoice date or payment date. If NOT issued within the window, Time of Supply = earlier of service completion date or payment date.
If advance payment is received before invoice, the Time of Supply is the date of receipt of advance (to the extent of the advance). The supplier must issue a receipt voucher on receiving advance and an invoice upon supply. The advance mechanism applies to both goods and services.
Section 14 of CGST Act covers rate changes. If supply is made before rate change but payment/invoice is after: new rate applies. If invoice issued before rate change but supply and payment are after: new rate applies. The general principle is that the new rate applies unless both invoice and payment are completed before the rate change date.
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