Time of supply under GST

Time of supply is the point at which a supply is treated as having taken place for GST purposes. It determines the tax period in which the liability arises, the rate that applies, and the return in which the transaction must be reported. If you account for a supply in the wrong period — for example, the month after it should have been recognised — you may end up paying tax late and attracting interest. Because the rules differ for goods, services and reverse-charge transactions, identify which set applies before fixing the date.

For a supply of goods, the time of supply is generally tied to the earlier of key events such as the issue of the invoice (or the last date by which the invoice should have been issued) and, where relevant, the receipt of payment. The idea is that the liability should not wait until money changes hands if the supply has already been invoiced or ought to have been. Because the precise triggering events and any timing relaxations can change, confirm the current rule rather than assuming payment is always the deciding event.

For services, the time of supply again turns on the earlier of defined events, typically linked to whether the invoice is issued within the prescribed period. If the invoice is issued on time, the time of supply is generally tied to the invoice or the receipt of payment, whichever is earlier; if it is issued late, the rule shifts to the completion of the service or payment. The practical lesson is to invoice services within the prescribed window, because delaying the invoice can change when your tax becomes due.

Where tax is payable under reverse charge — that is, by the recipient rather than the supplier — the time of supply follows a separate set of rules linked to events such as payment or receipt of goods or services. Special situations, including vouchers, continuous supplies spread over time, and additions to value like interest or late fees, also have their own timing rules. If your transaction falls into one of these categories, do not apply the ordinary goods or services rule by default — check the specific provision that governs it.

Once you have fixed the time of supply, that date drives which return period the transaction belongs to. Recording supplies in the correct period keeps your outward-supply reporting consistent with the tax you pay, reduces mismatches that surface later in reconciliations, and avoids interest for short or late payment. Keep your invoicing disciplined and dated correctly, because in most cases the invoice is central to determining the time of supply. When a transaction is unusual or spans periods, get advice before deciding the period.