GST: How to identify a fake GST invoice and report it?

The Goods and Services Tax (GST) was implemented in 2017 with the aim to ease the taxation system by replacing multiple indirect taxes such as VAT, service tax, etc. Every registered business under GST needs to issue an invoice, containing a valid GSTIN that would show the breakup of Integrated GST, Central GST, and State GST. However, just like every other new system, many fraudsters have started taking advantage of the GST regime.  Fake GST invoices have become a major issue of tax evasion for authorities.

Notably, such rampant cases of fraud in the form of fake GST invoices can be a big trouble for small businesses and customers as these help fraudsters in duping the money paid by customers in the name of tax.

Fake GST invoice

As stated by the Union Finance Ministry, a fake GST bill is generated by scammers to dupe businessmen and customers, even without any actual supply of goods or services or GST payment. It is basically generated for various fraudulent reasons like tax evasion, converting Income Tax credit into cash, booking fake purchases, and money laundering.

How to identify a fake GST bill?

A fake GST invoice or bill can be identified in a number of ways.

GSTIN verification

1. Individuals can check the authenticity of a GST invoice by verifying the GSTIN (Goods and Services Tax Identification Number) by visiting the official GST portal at https://www.gst.gov.in/.

2. On the homepage, select the option of 'Search Taxpayer' to check the GSTIN number as mentioned in the invoice.

3. In case of an authentic number, the details will be shown on the website.

GSTIN format

One can also identify a fake GST bill by understanding the basic structure of the 15-digit GSTIN number. While the first two digits of the GSTIN indicate the state code, the next ten digits are the PAN number of the seller or supplier. The 13th digit is the entity number of the same PAN holder, the 14th digit is the letter 'Z', and the 15th digit is the 'checksum digit'.

How to report fake GST invoices?

There are many ways to report cases of fake GST invoices.

1. You can visit the official GST portal and raise your complaint on the 'CBEC Mitra Helpdesk' and 'Raise Web Ticket'.

2. You can also send an email to cbecmitra.heldesk@icegate.gov.in.

3. One can also reach out to the concerned authority through GST's official Twitter handle.