GST Invoicing Method for Service Upgrade

Avijit Vikram (0 Points)

07 January 2022  

Dear All,

Would request your views on the correct invoicing method for service upgrade packages. Let me elaborate further:

We at Indiamart provide online subscripttion services to customers for advertising their products. When a customer purchases a package of say, Rs 100 for 1 year we collect the money upfront and issue an invoice of Rs 100 + GST. Now lets assume the customer opts for a upgrade (means higher package with additional features) after ,say, using the services for 6 months and the price of new package if Rs 200 for 1 year.

Current invoicing method: We issue a credit note of Rs 50 + GST against the old service, collect the balance amount from the customer (which is Rs 150 + GST) and issue a new invoice for Rs 200 + GST.

Proposed invoicing method: We propose to just issue a new invoice for Rs 150 + GST and don't issue any credit note.

Please let me know if the proposed method of invoicing sounds good.

PS: The GST rate for all our services is 18% only and the packages are different versions of online advertising.

Thanks