Invoice Without GST: The Simple Guide for Indian Startups
If you run a small business or a startup in Andhra Pradesh, you’ll often wonder whether every sale needs a GST charge. The short answer is: not always. Certain transactions are GST‑exempt, and you can legally issue an invoice without GST. Knowing when and how to do this saves time, avoids penalties, and keeps your books clean.
When Can You Skip GST on an Invoice?
Here are the most common scenarios where GST does not apply:
Turnover below the registration threshold – If your annual turnover is under INR 40 lakhs (INR 20 lakhs for services), you are not required to register for GST. Any invoice you raise can be GST‑free.
Export of services or goods – Exports are zero‑rated. You still need to mention ‘Export’ and the relevant GST number, but the tax amount is zero.
Specific exempt products – Items like fresh fruits, unprocessed agricultural produce, and some health services fall under GST exemption.
Government‑to‑government supplies – When a government department supplies to another department, GST is not levied.
Inter‑state supplies under composition scheme – Composite traders pay tax at a flat rate and do not charge GST on invoices.
Each case requires a clear statement on the invoice that GST is not charged and why.
How to Format an Invoice Without GST
Even without GST, the invoice must meet basic legal criteria. Include these fields:
Seller’s name, address, and PAN.
Buyer’s name and address.
Invoice number and date.
Description of goods or services.
Quantity, unit price, and total amount.
A clear note such as “GST not applicable – exempt under Section 11(1) of CGST Act” or “Export – GST zero‑rated.”
Signature or digital seal (optional but adds credibility).
Don’t forget to keep a copy of the exemption certificate or proof of export. The tax authorities may ask for it during an audit.
For startups that occasionally cross the threshold, it helps to maintain two invoice templates: one with GST breakdown and another for GST‑free sales. Switching between them becomes a one‑click task in most accounting software.
Now that you know the basics, let’s look at common mistakes to avoid.
Common Pitfalls
Charging GST on exempt items – This leads to double taxation and refunds that are hard to claim.
Missing the exemption note – If you don’t state why GST isn’t charged, the invoice may be rejected by the buyer’s finance team.
Using an old GSTIN after deregistration – Once you cancel GST registration, you must remove the GSTIN from all future invoices.
Fixing these errors early saves headaches later. If you’re unsure about a product’s tax status, the government’s GST portal offers a searchable list of exempt items.
Finally, remember that every invoice – GST or not – adds to your financial record. Good bookkeeping helps you track turnover, decide when to register for GST, and prepares you for future audits.
Need more help? Check out our articles on “GST Registration in India: Who Needs It and Why It Matters” and “GST Refund Eligibility: Who Can Claim a GST Refund & How It Works” for deeper insights. With the right knowledge, you can invoice confidently and keep your startup on the right side of the law.
Issuing invoices without GST in India can be a legal necessity or a strategic choice for certain businesses. Understanding when an invoice can forgo GST is essential for compliance and operational efficiency. This article explores scenarios such as GST exemption thresholds and the eligibility criteria for businesses opting out of GST inclusion on their invoices. Important facts and tips are provided to help businesses navigate GST regulations efficiently.
