Tax Invoice Format for Exported Goods: Meeting International Standards

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Published Date:  23-01-2024   Author:   yash-elwadhi
captainbiz tax invoice format for exported goods meeting international standards

Are you looking for a tax invoice format that meets international export standards? Look no further! This blog will focuses on the importance of meeting international standards in export billing and provide a comprehensive guide on the format for exported goods invoices. With the increasing globalisation of business, having a standardised invoice format that complies with international regulations is crucial. By adhering to these standards, you ensure smooth transactions, improve customer satisfaction, and avoid any disputes or delays in payment. Understanding the tax invoice format for exported goods is essential whether you are a seasoned exporter or just getting started in the international market. So, let’s dive in and learn more about this critical aspect of export business.

Need for Export Tax Invoice 

Insurance Claim Proof:

The export invoice is essential as proof in the event of an insurance claim, providing documented evidence of the transaction.

Transaction Verification:

It serves as tangible evidence that a transaction between the buyer and seller has occurred, aiding in clear documentation and transparency.

Shipping Documentation:

Integral to shipping-related paperwork, the export invoice is crucial in documenting and organising essential information.

Government Reference:

Government authorities may refer to the export invoice to ascertain the actual value of goods and calculate applicable taxes, ensuring regulatory compliance.

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Customs Clearance:

For smooth customs clearance in the destination country, the importer relies on the details provided in the export invoice.

Compliance in export goods invoicing under GST

In the framework of India’s Goods and Services Tax (GST) system, the GST export invoice is a mandatory document essential for meticulously recording exported goods or services. This document serves as a comprehensive record and as a crucial avenue for claiming input tax credits. As products transcend national borders, designating them as exports, companies immersed in import and export activities are legally obligated to accompany each consignment with a meticulously prepared GST export invoice. This vital document should encompass detailed information about the shipment, offering a comprehensive overview of the goods and the buyer’s contact details. By including these specific particulars, businesses facilitate smooth cross-border transactions, creating a robust point of reference for customs agents navigating the intricacies of the international trade landscape.

Indian Regulations Governing Export Invoices

Export under Bond/LUT:

Goods or services can be exported without paying IGST, as outlined in section 96A of the CGST regulations, 2017. Exporters opting for this route must file a mandatory Letter of Undertaking (LUT) when exporting without IGST payment.

Export with IGST:

The exporter pays IGST during export and claims a refund in this method. Refunds cover unutilised input tax Credits (ITC) and IGST spent on the exported goods and services.

SEZ with IGST:

To encourage exports, there are tax relaxations for supplies to Special Economic Zones (SEZs). The supply of goods to an SEZ is treated as a zero-rated supply, alleviating the need to pay taxes on exported goods.

Sections in Export Invoice

  • Credentials of the Supplier
  • Credentials of the Buyer
  • GSTIN of Supplier
  • Details of Goods or Services
  • Invoice Date
  • Invoice Number
  • Conversion Rate
  • Amount
  • Type of Export
  • Details of Shipping Bill
  • Signature
  • Notes

Export goods invoice formatting

  • Exporter Information: Exporter’s Name, Address, Contact Details, and GSTIN.
  • Recipient Details: Recipient’s Name and Addresses (Billing and Shipping).
  • Invoice Details: date of invoice issuance, due date, unique invoice number.
  • Financial Aspects: conversion rate from INR to applicable currency, total invoice value.
  • Export Specifics: type of export, shipping bill details.
  • Authorisation and Verification: Signature (Physical or Digital) of the Authorized Person.
  • Additional Information: Notes Section for any messages or instructions to the importer.

Good Practices for Seamless Export

  • Packing List Necessity: Essential for international shipments to prevent inaccuracies in cargo handling.
  • Supporting Document for Goods: A document for goods transitioning from one business to another.
  • Accompanies Certificate of Inspection: Often paired with a certificate of inspection, adding an extra layer of validation to the shipped goods.
  • Export Invoice Details: This plays a vital role by providing specific information related to packing and shipping.

Also Read: Tax Invoice Format For Goods: Meeting The Compliance Standards

Conclusion

In this article, we have discussed the standards for export tax invoices and how to create a format that meets the export goods billing standards. We have explained the importance of complying with international trade regulations and the GST system when issuing export tax invoices. We have also provided a sample format of an export tax invoice that contains all the essential details, such as the invoice number, date, GSTIN, HSN code, place of supply, signature, payment terms, and shipping bill or bill of export. By following this format, you can ensure that your export tax invoices are accurate, complete, and consistent with the global trade standards. By complying with the international trade regulations and the GST system, you can avoid any legal issues, penalties, or disputes arising from improper invoicing practices. Moreover, you can enhance your reputation and credibility as a reliable and trustworthy exporter in the international market. Therefore, following the standards for export tax invoices and creating a format that meets the export goods billing standards is essential.

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Frequently Asked Questions(FAQs)

  1. How does the GST law in India categorise exports?

GST law in India recognises three types of exports: Export under Bond/LUT, Export with IGST, and SEZ with IGST, each with specific implications for tax payments and refunds.

  1. How does GST law facilitate tax relaxations for exports to Special Economic Zones (SEZs)?

Supplies to SEZs are treated as zero-rated, meaning taxes on the exports do not need to be paid, providing a favourable environment to boost exports.

  1. Why is the due date mentioned in an export invoice?

The due date in an export invoice indicates the deadline for the recipient to make the payment, ensuring clarity in financial transactions between the exporter and the recipient.

  1. Why is the due date mentioned in an export invoice?

The due date in an export invoice indicates the deadline for the recipient to make the payment, ensuring clarity in financial transactions between the exporter and the recipient.

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Yash Elwadhi

Yash Elwadhi is a highly skilled and experienced finance content writer with a proven track record of providing insightful and engaging content to a wide range of clients in the financial industry. He has collaborated with prominent financial institutions, fintech companies, and wealth management firms, and is known for his ability to convey complex financial concepts in a clear and engaging manner. Yash is committed to delivering high-quality content that adds value to his clients' target audience and helps them achieve their financial goals.

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