How to apply discount after GST ?
In GST Tax regime, all discounts in sales invocie are applied before applying GST and GST is to be charged after applying all discounts. So there is no reason to charge GST on discount amount.We provide you discount, scheme discount and lot discount column in sales invoice and purchase invoice to handle the same.
As there may be different GST rates applicable on the same invoice, discounts/other adj amount at the end of invoice can not be deducted before tax as it is not possible to attribute this amount to each item line. To deduct discount before tax, it must be given against each item in detail lines.
Discounts given after supply will be allowed only if-
- It is mentioned in the agreement entered into before sale AND
- input tax credit proportionate to the discount has been reversed by the recipient of the supply AND
- It can be clearly tracked to relevant tax invoice
Still if you want to reduce any amount after GST in purchase invoice, use other adj. column. In sales invoice, you can use cash discount column which is applied after GST and does not effect calculation of GST in invoice.
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