When IGST Applies to Your Sales
Interstate Sales Trigger IGST
When you sell to customers in a different state from your registered business location, IGST (Integrated GST) applies instead of CGST + SGST. Compare the first two digits of both GSTINs - different state codes mean IGST billing is mandatory.
Your GSTIN starting with "09" (Uttar Pradesh) selling to "19" (West Bengal) automatically triggers IGST, regardless of transaction value or physical proximity.
Branch Offices Need Separate Treatment
Each branch or warehouse in different states needs separate GSTIN registration. Sales from your Mumbai branch to Delhi customers attract IGST, even if your head office is in Delhi. The selling location determines tax structure, not headquarters.
IGST Rate Calculation Made Simple
Single Tax Rate Structure
IGST rate equals CGST + SGST combined. Products with 9% CGST + 9% SGST become 18% IGST for interstate sales. Never split IGST into CGST and SGST components on interstate invoices.
Check current rates on our GST rates page or verify on the official GST portal, as rates change periodically.
Creating IGST-Compliant Invoices
Mandatory Invoice Requirements
Interstate invoices must show:
- Buyer's complete address with state name and PIN
- Both GSTINs prominently displayed
- "IGST" clearly marked in tax breakup
- Delivery address and destination state
Both parties need valid GSTIN registrations. For services, document where performed or consumed to determine correct place of supply.
IGST Payment and Filing
How It Works
Sellers file IGST in monthly GSTR-3B returns. Central government receives full IGST amount, then distributes to destination states. Buyers claim complete IGST as input tax credit against any output tax liability.
Report interstate sales in GSTR-1 under "B2B" interstate section. Ensure HSN codes and rates match buyer's records for smooth ITC claims.
Common IGST Mistakes to Avoid
Wrong Tax Structure
Never show CGST + SGST on interstate invoices. Always use single IGST rates for different-state customers to avoid compliance issues.
Missing Documentation
Maintain delivery challans and transport documents proving interstate sales. Generate e-way bills for goods movement above ₹50,000 - this requirement is separate from IGST billing but essential for legal transport.
Always verify current IGST rules on gst.gov.in, as regulations update periodically.
