CGST, SGST or IGST: which one goes on your invoice, and how to split it

GST is one tax with three names on an invoice. The rate on an item never changes with the buyer, but the way you write it down does. Get the heads wrong and the tax lands with the wrong government, which your customer’s accountant will ask you to fix.

The one question that decides it

Ask where the supply goes, not where the buyer lives. The law calls this the place of supply, and for most sales of goods it is where the goods are delivered.

• Same state as you: it is an intra-state supply. Charge CGST and SGST.
• A different state: it is an inter-state supply. Charge IGST.

That is the whole rule for the common case. The complications are in working out the place of supply for services and for special situations, not in the split itself.

Within a state: CGST and SGST, half each

CGST goes to the Centre and SGST to the state. Each is exactly half the rate:

Rate	CGST	SGST
5%	2.5%	2.5%
18%	9%	9%
40%	20%	20%

The same split applies at every rate: a restaurant bill at 5% shows 2.5% plus 2.5%, and gold jewellery at 3% shows 1.5% plus 1.5%.

So ₹1,000 at 18% within a state carries ₹90 CGST and ₹90 SGST, for ₹180 of tax and ₹1,180 in all. Both lines go on the invoice, each with its rate and amount.

In a union territory without its own legislature, such as Chandigarh, Ladakh or Lakshadweep, the state half is called UTGST instead. Delhi, Puducherry and Jammu and Kashmir have legislatures, so they charge SGST. The arithmetic is the same.

Across state lines: IGST, the full rate

IGST is collected by the Centre and passed on to the state where the supply is consumed. It is charged at the full rate on a single line.

₹25,000 at 18% to a buyer in another state carries ₹4,500 IGST, for ₹29,500 in all. Charged within a state, the same sale would carry ₹2,250 CGST plus ₹2,250 SGST. The customer pays exactly the same. Choosing IGST to look cheaper, or CGST and SGST to look local, is not an option: the place of supply decides.

IGST also applies to imports. A supply to a unit or developer in a Special Economic Zone is treated as inter-state too, even when the zone is in your own state.

Splitting the tax without losing a paisa

Rates like 5% produce halves that do not round cleanly. Take a bill of ₹849 including 18% GST. The price before tax is ₹719.49 and the tax is ₹129.51. Half of that is ₹64.755, which cannot be written on an invoice.

Round the total tax first, then split it so the halves add back up:

• CGST: ₹64.76
• SGST: ₹64.75
• Total tax: ₹129.51

Rounding each half on its own gives ₹64.76 twice, which is ₹129.52: a paisa that was never charged. It is small, but it is exactly the sort of mismatch that fails a reconciliation. Our guide to calculating GST covers taking the tax out of a total like this one.

When there is no split at all

A business in the composition scheme pays a flat rate on its turnover: 1% for most traders and manufacturers, and 6% for service providers. It cannot charge GST to its customers and does not show CGST, SGST or IGST on its bills. It issues a bill of supply instead of a tax invoice, and pays the composition tax out of its own margin.

If you buy from a composition dealer, there is no GST line to check and none to claim.

Doing the split in one tap

GST Calculator asks one question, within the state or across state lines, and shows the tax as CGST and SGST or as IGST. It rounds the total tax before splitting, so the parts always add back to the tax and the tax back to the total. It works offline, asks for no account, and keeps your recent calculations on your phone. A browser version runs the same calculation, with a Within my state or To another state switch.

It is an independent app. It does not decide the place of supply for you, and it is not a government service. When a supply is unusual, such as services to a buyer abroad or goods shipped on someone else’s instruction, check the place of supply with your accountant before you invoice.