02/06/2026
📌 How to Raise Tax Invoice Under GST Margin Scheme | Rule 32(5)
Are you dealing in second-hand goods like used mobiles, cars, jewellery, laptops or refurbished items?
The GST Margin Scheme is a great benefit for you! Under this scheme, you pay GST only on your margin (profit) instead of the full selling price. This saves tax and avoids double taxation.
✅ How to Issue Tax Invoice Under Margin Scheme (Step-by-Step):
Issue a Regular Tax Invoice (NOT Bill of Supply)
Add Mandatory Declaration on the invoice:
“Margin scheme under Rule 32(5) of CGST Rules, 2017”
Calculate GST only on the Margin (Selling Price – Purchase Price)
Do NOT claim Input Tax Credit (ITC) on purchase of these goods
Mention clear description of the goods as “Used/Second Hand”
📊 Example:
Purchase Price of Used Mobile Phone: ₹25,000
Selling Price: ₹32,000
Margin = ₹32,000 - ₹25,000 = ₹7,000
GST @18% on Margin = ₹1,260 only
(Instead of GST on full ₹32,000)
Total GST Saved = Huge benefit for your business!
Important Points:
Works for both intra-state and inter-state supplies
Buyer can claim ITC on the GST you charge
Maintain proper purchase records and invoices
Most suitable for dealers in second-hand/used/refurbished goods
This scheme is a game-changer for resellers and traders of pre-owned items.
Need help with GST Invoice formatting, compliance, or filing under Margin Scheme?
Contact us today!
SGPA AND ASSOCIATES
Chartered Accountants
📞 +91 78478 37543
✉ [email protected]
Tax Advisory | CFO Services | GST Compliance
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