Pending professional review. This guide is awaiting review by our Chartered Accountants.
GST rates do change — most recently with the rate rationalisation that took effect on 22 September 2025. For transactions that straddle the date of change, the question is simple to ask and easy to get wrong: which rate goes on the invoice?
The three events that decide the rate
Section 14 of the CGST Act, 2017 looks at three events and asks whether each happened before or after the rate change:
- Supply — when the goods were supplied or the services were provided;
- Invoice — when the invoice was issued;
- Payment — when the payment was received.
In practice the rule works out as a majority test: if any two of the three events took place before the change, the old rate applies; if any two took place on or after the change, the new rate applies.
What counts as the "date of payment"?
For this purpose, the date of receipt of payment is the date the payment is entered in the supplier's books of account or the date it is credited to the supplier's bank account, whichever is earlier.
A quick illustration
| Supply | Invoice | Payment | Rate |
|---|---|---|---|
| Before | Before | After | Old rate |
| Before | After | After | New rate |
| After | Before | Before | Old rate |
| After | After | Before | New rate |
Points to check before you finalise
- Confirm the correct HSN/SAC classification and the rate notified for it — the notification is the authority, not a summary table.
- Advances received before the change and invoices raised after it are where most errors arise.
- Check how the change affects input tax credit and existing contracts with customers and suppliers.
Our GST Rate Change calculator applies this test to your dates. For high-value or continuing contracts, ask us to review the position before invoicing.