Statutory Guides6 min read•Jul 10, 2026

The Ultimate Guide to GST for Indian Freelancers & Consultants

Statutory Reference: CGST Act Sec. 22 & 24

Under Indian tax jurisprudence, independent consultants, software developers, and creative professionals are treated as service providers subject to the provisions of the Central Goods and Services Tax (CGST) Act, 2017. Understanding your statutory duties protects you from severe penalty notices under Section 122.

Statutory Threshold Summary (FY 2025–26)

Service providers must register if aggregate turnover exceeds ₹20,00,000 per annum (or ₹10,00,000 in Special Category States). However, any inter-state supply mandates compulsory registration under Section 24(i) regardless of turnover threshold.

1. Inter-State Supply vs Intra-State Supply

The tax split applied on every invoice depends entirely on the Place of Supply (PoS) relative to your registered business location:

Intra-State Supply (Same State)

If your registered address is in Maharashtra (State 27) and your client is also in Maharashtra, apply 50% CGST + 50% SGST. On an 18% SAC rate, that equals 9% CGST and 9% SGST.

Inter-State Supply (Different State)

If your client is located in Karnataka (State 29) or any other state, apply 100% IGST (Integrated GST). The entire 18% is reported in Table 4A/5 of GSTR-1.

2. Export of Services & Zero-Rated Supply

Invoicing offshore overseas clients (US, UK, Europe, etc.) qualifies as an Export of Services under Section 2(6) of the IGST Act when payment is received in convertible foreign exchange (or INR through permitted RBI Vostro accounts).

Exports are classified as zero-rated supplies. By submitting a valid Letter of Undertaking (LUT) on the GST portal (Form GST RFD-11) at the beginning of each fiscal year, you can invoice international clients with 0% IGST without having to pay tax upfront and wait for refunds.

3. Mandatory Section 31 Invoice Elements

Under CGST Rule 46, your tax invoice must include the following statutory particulars to remain legally binding:

Consecutive serial number not exceeding 16 characters containing alphabets, numerals, or hyphens.
Date of invoice issue and place of supply along with the two-digit State code.
Supplier and Recipient legal names, registered addresses, and 15-digit GSTINs.
Service Accounting Code (SAC) for each billed line item.
Taxable value, applied rates, and exact rupee breakdown of CGST, SGST, and IGST.

Statutory NoticeThis technical guide references provisions of the Central Goods and Services Tax Act, 2017. For complex organizational restructurings or disputed classifications, consult your registered Chartered Accountant.

1. Inter-State Supply vs Intra-State Supply

The tax split applied on every invoice depends entirely on the Place of Supply (PoS) relative to your registered business location:

Intra-State Supply (Same State)

If your registered address is in Maharashtra (State 27) and your client is also in Maharashtra, apply 50% CGST + 50% SGST. On an 18% SAC rate, that equals 9% CGST and 9% SGST.

Inter-State Supply (Different State)

If your client is located in Karnataka (State 29) or any other state, apply 100% IGST (Integrated GST). The entire 18% is reported in Table 4A/5 of GSTR-1.

2. Export of Services & Zero-Rated Supply

3. Mandatory Section 31 Invoice Elements

Under CGST Rule 46, your tax invoice must include the following statutory particulars to remain legally binding:

Consecutive serial number not exceeding 16 characters containing alphabets, numerals, or hyphens.

Date of invoice issue and place of supply along with the two-digit State code.

Supplier and Recipient legal names, registered addresses, and 15-digit GSTINs.

Service Accounting Code (SAC) for each billed line item.

Taxable value, applied rates, and exact rupee breakdown of CGST, SGST, and IGST.

The Ultimate Guide to GST for Indian Freelancers & Consultants

1. Inter-State Supply vs Intra-State Supply

2. Export of Services & Zero-Rated Supply

3. Mandatory Section 31 Invoice Elements

Related Compliance Guides

Why You Need a Section 31 Tax Invoice to Accelerate Client Payments

Common GST Invoicing Mistakes Made by Solopreneurs & Agencies

The Ultimate Guide to GST for Indian Freelancers & Consultants

1. Inter-State Supply vs Intra-State Supply

2. Export of Services & Zero-Rated Supply

3. Mandatory Section 31 Invoice Elements

Related Compliance Guides

Why You Need a Section 31 Tax Invoice to Accelerate Client Payments

Common GST Invoicing Mistakes Made by Solopreneurs & Agencies