Purchase Bill

About the purchase bill tool

How to record a purchase bill in VyaparKit

1. 1

   Add the vendor

   Click Add vendor and enter the name, GSTIN and state from their invoice. The state decides the tax split: same state as yours gives CGST + SGST, a different state gives IGST.

2. 2

   Enter the vendor's invoice details

   Type the vendor invoice number and date exactly as printed. These are what the GST portal matches in GSTR-2B, so a typo can cost you the credit. Pick a purchase category (raw material, trading goods, expenses, capital goods).

3. 3

   Add the items

   Click Add line and pick saved items or type new ones with HSN, quantity, unit, rate and GST rate. The tax is calculated per line and split according to the vendor's state. Add freight or other charges as lines if the vendor charged them.

4. 4

   Set ITC eligibility

   Leave ITC eligible on for normal business purchases. Turn it off for blocked credits under Section 17(5) such as motor cars, food and beverages, personal items, or purchases from a composition dealer, so your GSTR-3B ITC figure stays clean.

5. 5

   Save

   Click Create. Stock goes up for the items, the vendor's balance goes up by the bill total, and the eligible tax appears in your ITC summary for the month.

6. 6

   Pay or return

   When you pay, open the bill and click Convert to Payment Voucher; it can be a part payment. For returns or short supply, Convert to Debit Note, which reduces both the payable and your ITC.

What to check on a vendor's invoice before you claim ITC

• Vendor's GSTIN is valid and active (use the GSTIN checker), and the invoice shows your correct GSTIN as recipient; credit on an invoice addressed to a different GSTIN is not yours.
• Vendor invoice number and date, entered exactly, because ITC is only available once the invoice appears in your GSTR-2B (Section 16(2)(aa)).
• Place of supply: your state. If the vendor is in another state the invoice must show IGST; if the vendor charged CGST/SGST from another state, ask for a corrected invoice.
• HSN or SAC per line (4 digits if the vendor's turnover is up to ₹5 crore, 6 digits above), quantity, unit, rate, taxable value and the tax amounts.
• Whether the purchase is a blocked credit under Section 17(5): motor vehicles for personal use, food and catering, club memberships, personal consumption, goods lost or given as gifts, and construction of immovable property.
• The other Section 16 conditions: goods or services actually received, and payment to the vendor within 180 days of the invoice date, failing which the credit must be reversed with interest.
• Reverse charge cases (for example, goods transport agency services, or specified purchases from unregistered suppliers) where you pay the tax and then claim it, marked accordingly.
• Bills from composition dealers carry no tax and no ITC; record them with the ITC toggle off.

Who uses the purchase bill

Purchase Bill: frequently asked questions

What are the conditions for claiming input tax credit on a purchase?

Under Section 16 of the CGST Act you need a valid tax invoice, you must have received the goods or services, the vendor must have reported the invoice so it appears in your GSTR-2B, the vendor must have paid the tax, and you must pay the vendor within 180 days. The purchase must also not be a blocked credit under Section 17(5). Claim only what meets all conditions.

Why does an out-of-state vendor charge IGST instead of CGST and SGST?

GST is a destination tax. When the vendor's state differs from the place of supply (your state, for goods delivered to you), the supply is inter-state and IGST applies. Same-state purchases attract CGST plus SGST. The total tax is identical; only the split differs. The split matters because IGST credit is set off in a different order in GSTR-3B.

Which purchases cannot be claimed as ITC?

Section 17(5) blocks credit on motor vehicles for personal or passenger use (with exceptions for dealers, transporters and driving schools), food and beverages, outdoor catering, beauty and health services, club and gym memberships, life and health insurance in most cases, personal consumption, goods lost, stolen, destroyed or given as free samples, and works contracts for immovable property. Mark such bills ITC not eligible.

Does recording a purchase bill add the items to my stock?

Yes. Every item line on a purchase bill increases the saved item's quantity, and the rate on the bill is your latest cost. If you receive goods before the vendor's invoice, record a Goods Receipt first so stock is correct, and convert the purchase order or receipt into the purchase bill when the invoice arrives, so stock is not added twice.

How do I record a purchase from an unregistered vendor?

Record it as a purchase bill with no GST and ITC off, so stock and the vendor's balance stay correct. In a few notified cases (for example certain services like goods transport, or specified goods) reverse charge applies and you must pay the tax yourself and then claim it; check with your CA whether your purchase is one of them.

What is GSTR-2B and why should my purchase bills match it?

GSTR-2B is the auto-drafted statement of the ITC available to you for a month, generated from what your vendors filed in their GSTR-1. Since 2022, ITC can be claimed in GSTR-3B only if the invoice appears in GSTR-2B. Recording the vendor's invoice number and date exactly lets you or your CA match your bills to 2B and chase vendors who have not filed.

Can I convert a purchase bill into a payment voucher or debit note?

Yes. From the bill, Convert to Payment Voucher records a full or part payment to the vendor and marks the bill paid or partly paid. Convert to Debit Note records returns, short supply or a rate difference; it reduces the amount payable to the vendor and the ITC you claim. Both stay linked to the original bill.