GlossaryGST & Tax
Bill of Supply
Also called: bill of supply invoice
What is Bill of Supply?
A bill of supply is issued instead of a tax invoice when a supplier cannot charge GST — typically a composition dealer, or a supply of exempt goods and services. It carries no tax amount and confers no input tax credit.
Why Bill of Supply matters
Using a tax invoice where a bill of supply is required, or the reverse, misstates the tax position on the face of the document and confuses customers who try to claim credit from it.
How Bill of Supply works in practice
Keep a separate document series for bills of supply so the two never share numbering. A composition dealer's bill of supply must also declare that the supplier is not eligible to collect tax on supplies.
Frequently asked questions
No. No tax is charged on it, so there is nothing to claim.
Related terms
Tax InvoiceThe GST document that lets your customer claim input tax credit.Composition SchemeA simplified GST route where small businesses pay a flat rate on turnover.GSTIndia's single indirect tax on the supply of goods and services.Invoice NumberingThe sequential series that identifies each invoice you issue.