CGST/IGST Rules 2025-26

Place of Supply Calculator

Determine in seconds whether your GST invoice should charge CGST+SGST or IGST.

Understanding Place of Supply Under GST India

Among all the concepts introduced by the Goods and Services Tax (GST) framework, Place of Supply (POS) is arguably the most impactful for billing accuracy. The reason is simple: the Place of Supply determines whether a transaction is "intra-state" or "inter-state," and that single classification decides which type of tax you must charge and collect.

If you get this wrong — for example, charging CGST+SGST when you should have charged IGST — the entire invoice is non-compliant. Your buyer cannot claim Input Tax Credit on it, and both you and your customer become exposed to penalties during departmental audits.

Place of Supply Rules for Goods

For supplies involving physical goods, determining the Place of Supply is generally straightforward:

  • Goods Involving Movement: When goods are physically moved from one location to another, the Place of Supply is the location where the goods are delivered to the recipient. If a Mumbai supplier ships goods to a customer in Pune (same state), the POS is Maharashtra — making it an intra-state supply (CGST+SGST). If the same supplier ships to a customer in Bangalore, the POS is Karnataka — making it an inter-state supply (IGST).
  • Goods Without Movement (Installation): When goods are assembled or installed at a specific site (e.g., industrial machinery), the Place of Supply is the location of that assembly or installation site.
  • Bill-to-Ship-to Transactions: This is a common source of confusion. If Company A (in Delhi) buys from Supplier B (in Gujarat) and instructs Supplier B to directly ship the goods to Customer C (in Rajasthan), there are two separate supplies here: Supplier B to Company A (inter-state, IGST), and Company A to Customer C (inter-state, IGST). Use the respective GSTINs to determine the tax for each leg.

Place of Supply Rules for Services

Services are intangible, which makes their Place of Supply rules considerably more nuanced. The IGST Act provides distinct rules for different categories of services:

  • Default Rule for B2B Services: The Place of Supply is the location of the registered recipient. If an IT firm in Hyderabad provides software services to a GST-registered company in Delhi, the POS is Delhi (the recipient's location). The Hyderabad firm must charge IGST.
  • Default Rule for B2C Services: The Place of Supply is the location of the supplier. If the same IT firm provides services to an unregistered individual anywhere in India, the POS is Telangana (the supplier's state). CGST+SGST is applicable.
  • Immovable Property Services: For services related to immovable property (construction, architecture, real estate agents), the Place of Supply is where the property is located, regardless of where the supplier or recipient is located.
  • Restaurant & Catering: The Place of Supply is the location where the restaurant or catering service is actually performed.
  • Transportation of Goods: For registered recipients, the POS is the recipient's location. For unregistered individuals, the POS is the origin of the goods.

Cross-Verification Tip

After determining your place of supply, always cross-verify the state code in your customer's GSTIN using our GST State Code Finder. The first two digits of the GSTIN represent the state, making it easy to confirm your POS determination before generating the final invoice.

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Frequently Asked Questions

Understanding Place of Supply rules for correct GST (IGST vs CGST/SGST) determination.

What is Place of Supply under GST?
Place of Supply (POS) is the location where a supply is deemed to have taken place for GST purposes. It determines whether a transaction is treated as intra-state (CGST+SGST applies) or inter-state (IGST applies). It is governed by Sections 10-13 of the IGST Act.
How is Place of Supply determined for goods?
For supply of goods, POS is typically the location where goods are delivered to the buyer. If goods are sent to a different state, the POS is the delivery state, making it inter-state (IGST). If delivered within the same state as the supplier, CGST+SGST applies.
How is Place of Supply determined for services?
For most services, POS is the location of the recipient. If the recipient is GST-registered (has a GSTIN), POS is their registration state. If unregistered, POS is their usual residence or address. For specific services (like immovable property, event-based, transportation), special rules override the default.
What is the Place of Supply for restaurant services?
For restaurant, catering, and food delivery services, the Place of Supply is the location where the service is actually performed. So a restaurant in Mumbai serving a customer from Delhi would charge CGST+SGST (both Maharashtra rates), not IGST.
What is the Place of Supply for online services?
For online information and database access services (OIDAR) provided to unregistered recipients, the POS is the location of the recipient. If provided to a registered business, it is the recipient's GSTIN location. This is how streaming services and SaaS platforms determine their GST.
When does IGST apply instead of CGST+SGST?
IGST applies when the Place of Supply is in a different state from the Supplier's state. For example, a supplier in Karnataka selling to a buyer in Maharashtra: Karnataka is supplier state, Maharashtra is POS → IGST applies. If both states match, CGST+SGST applies.
What is the Place of Supply for transportation services?
For passenger transportation: POS is the place where passengers embark (board the vehicle). For goods transportation: POS is the location of the recipient. However, if the recipient is unregistered, POS is the place of delivery of goods.
What is the Place of Supply for immovable property services?
For services directly related to immovable property (like construction, real estate agent services, architects, interior designers), the POS is the location of the property itself, regardless of where the supplier or recipient are located.
What is the Place of Supply for import of services?
For import of services into India (e.g., paying a foreign consultant), the POS is the location of the recipient in India. IGST applies and must be paid under Reverse Charge Mechanism (RCM). The recipient self-assesses and pays the IGST.
What happens if I charge wrong GST (CGST/SGST instead of IGST)?
This is a common error. If you charge CGST+SGST on an inter-state supply (where IGST should have been charged), the error must be corrected via a revised invoice or credit note. The state where CGST+SGST was paid must refund you, and you re-pay as IGST. Failure to correct can attract interest and penalties.