CGST, SGST & IGST Explained: Which Goes on Your Invoice?

Every GST invoice in India shows one of two tax structures — either two separate components (CGST and SGST) or a single one (IGST). Which you use isn't a choice; it's determined by where your buyer is. Here's how to read the rules.

Three taxes, one GST

When India introduced GST, it had to accommodate both the central government and state governments, since indirect taxes had historically been shared between them. The solution was to split the GST rate into components based on the nature of the transaction:

• CGST (Central GST) — collected by the central government
• SGST (State GST) — collected by the state government of the supplier's state
• IGST (Integrated GST) — collected by the central government for cross-state transactions, then apportioned to the destination state

All three trace back to the same GST framework and rates. The split is purely administrative — the tax burden on your customer is identical either way.

Intra-state transactions: CGST + SGST

When you and your client are in the same state, the transaction is intra-state. The applicable GST rate is split equally between CGST and SGST.

So for an 18% rate: 9% goes to CGST and 9% goes to SGST. Both amounts appear as separate line items on the invoice.

Example: A designer in Bengaluru invoices a Bengaluru-based startup for ₹50,000 of work at 18% GST.

Inter-state transactions: IGST

When you and your client are in different states, the transaction is inter-state and IGST applies. The full rate (say, 18%) appears as a single IGST line — there is no CGST or SGST on an inter-state invoice.

Same example, different state: The same designer in Bengaluru invoices a Mumbai-based client for ₹50,000 at 18%.

The total tax paid by the client is exactly the same. The difference is only in how the revenue is shared between the central and state governments.

The one rule to remember: place of supply

The decision between CGST+SGST and IGST hinges on a concept called place of supply — the location where the supply is deemed to have been consumed for GST purposes. In most straightforward service transactions, the place of supply is the registered address of the recipient (your client's billing state).

Place of supply rules get more nuanced for specific service categories (like immovable property services, passenger transport, or services for government bodies), but the state-matching rule covers the vast majority of freelance and small-business invoicing. For the full picture, see Place of Supply: When to Charge IGST vs CGST+SGST.

Worked example: ₹10,000 invoice at 18%

Putting it all together with a round number:

Scenario A — Client is in your state (intra-state)

• Taxable value: ₹10,000
• CGST @ 9%: ₹900
• SGST @ 9%: ₹900
• Invoice total: ₹11,800

Scenario B — Client is in a different state (inter-state)

• Taxable value: ₹10,000
• IGST @ 18%: ₹1,800
• Invoice total: ₹11,800

Both invoices collect ₹1,800 in tax from your client. The only difference is the line items on the face of the invoice — and how the government splits the revenue internally.

How this affects your invoice format

A compliant GST invoice format must show whichever components apply. You cannot mix IGST with CGST/SGST on the same invoice. If you get it wrong:

• Your client cannot claim input tax credit on the invoice.
• You may need to issue a credit note and a corrected invoice, creating extra filing work.

E-BillR automatically selects CGST+SGST or IGST based on your registered state (set in Settings) and the client's billing state on the invoice. Once your GSTIN is saved, the correct split happens without any manual choice. For an overview of what GST is and how the broader system works, see What Is GST?.