Types of GST Explained: CGST, SGST, IGST and UTGST

Four names, one taxable value

CGST, SGST, IGST, and UTGST are not four different taxes you stack on the same invoice for good measure. They are the ways the GST on one supply is assigned between the Centre and the states or Union territories. You determine the taxable value, you determine whether the supply is intra-state or inter-state, and only then do you apply the rate that is in force for that classification.

The Centre levies central tax and integrated tax. States levy state tax. Certain Union territories levy Union territory tax. The GST Council recommends the structure; the charge still has to be in the law and the rate notification you are relying on. For the story of credit and supply, start with . This page is only the split.

CGST and SGST on an intra-state supply

When the place of supply is in the same state as the location of the supplier, the supply is intra-state. The GST is split into Central GST (CGST) and State GST (SGST). On the invoice you show them as two amounts on the same taxable value. In the return they are paid and credited in separate columns. Using only one of them, or dumping the whole tax into a single line, breaks both your customer’s credit and your own payment screen.

SGST belongs to the state in which the supply is treated as made, which is why the state code on your GSTIN and the place of supply have to be a conscious pair. A warehouse, a site, and a billing office can sit in different states. Do not assume the head office state is the location of the supplier for every invoice. If registration is required in the state where the supply is made, that is a , not a cosmetic change of letters on the invoice.

UTGST when the supply is inside a Union territory

Union territory tax (UTGST) takes the place of SGST when the intra-state supply is in a Union territory that does not have its own legislature. The invoice pattern is the same idea: a central component and a Union territory component on one taxable value. Territories with a legislature follow the state pattern. If you are unsure which regime a destination uses, read the place-of-supply result and the portal’s state list rather than guessing from the PIN code.

IGST on an inter-state supply

When the location of the supplier and the place of supply are in two different states or Union territories, the supply is inter-state and Integrated GST (IGST) is the component you charge. You do not also add CGST and SGST on top. One taxable value, one integrated amount, reported in the integrated column of the outward statement and the summary return.

IGST is also the component used on imports of goods and on imports of services, following the valuation and time-of-supply rules that apply to imports. The customs document and the GST return have to tell the same story about the tax paid at the border or under reverse charge. Treat import IGST as its own row in the purchase register so it is not mixed with domestic input tax.

Why the integrated column exists in the credit ledger

Credit of integrated tax, central tax, and state or Union territory tax is tracked separately because the payment screen uses them in an order the law prescribes. That order has been amended before. Do not hard-code an old utilisation sequence into a worksheet and assume the portal will agree. Read the payment tile for the period. The shows where these columns reappear when you pay.

Place of supply decides the head

Place of supply is a legal conclusion, not the address in the “bill to” box alone. Goods often follow where the goods are delivered or where movement ends. Services follow rules that look at the recipient, the place of performance, or a specific proxy, depending on the service. The IGST statute is where those rules live. Cite the rule you used in the margin of the register when the case is unusual.

Exports and supplies to a special economic zone are reported with their own markers. They can be zero-rated when the conditions are met, which is a different statement from “no tax head”. Zero-rated supplies still have a reporting path in the outward statement, including whether you export on payment of integrated tax or under a bond or letter of undertaking. Read the current condition list before you pick a marker. The shows the tiles, not the legal test.

The same goods, two invoices

A wholesaler in Indore sells the same fittings to a shop in Indore and to a contractor working in Bhopal. Assume both places of supply follow the delivery. The Indore invoice is intra-state: CGST and SGST, and the state component is Madhya Pradesh’s. The Bhopal invoice is still inside the same state if the place of supply is Madhya Pradesh, so it is not inter-state merely because the city changed. A third invoice, delivered in Maharashtra, is inter-state: IGST, and no SGST line.

The worked point is the comparison, not a rate. If the wholesaler’s software has one tax code for “local” and one for “outside”, someone must define those words as place-of-supply outcomes. City names are a poor definition. When the goods then move by road, the is the next control, because the tax head on the invoice and the movement document should not contradict each other.

A classification checklist

Classify the head before you print. 1. Name the supplier’s location for this supply and the registration that will issue the invoice. 2. Apply the place-of-supply rule for goods or for that service and write the place down. 3. If the two are in the same state, use CGST and SGST. 4. If that state is a Union territory without a legislature, use CGST and UTGST. 5. If they are in different states or Union territories, use IGST only. 6. If the supply is an import or an export, open the special rules before you copy a domestic code. 7. Look up the rate for the HSN or SAC on the notification in force, and apply it to the head you just chose.

Keep the checklist on the invoice-approval screen. A reviewer who sees IGST and SGST on the same ordinary invoice should send it back. Those combinations exist only where a specific rule says so. Ordinary domestic supplies take one pattern or the other.

How the heads show up when you file

The outward statement asks for the tax already split. The summary return asks again, in totals, and the payment screen asks a third time when you set off credit and cash. If the three disagree, the usual cause is an invoice whose head was wrong, an amendment posted to the wrong period, or a credit note that reversed value but not the right component. Reconcile heads, not only a single “GST total”.

Rates, compensation cess on some goods, and special place-of-supply exceptions are published by the government and do change. Confirm them on the GST portal and on CBIC GST for the tax period. The makes you map a small sales register onto these heads until the split is boring. Boring is the aim.