How to Calculate CGST, SGST and IGST

How to calculate CGST, SGST and IGST starts from one total rate. When you raise a GST invoice, the total tax rate on an item stays the same. What changes is the tax head: CGST and SGST (or UTGST) for a supply inside one State or Union territory, and IGST when the supply is inter-State.

The test is not “does the parcel cross a border?” It is this: is the location of the supplier in the same State or Union territory as the place of supply?

The core rule: same State or different State

Union territories without a legislature use CGST + UTGST on an intra-State supply. Those territories are Andaman and Nicobar Islands, Chandigarh, Dadra and Nagar Haveli and Daman and Diu, Lakshadweep, and Ladakh.

Delhi, Puducherry and Jammu and Kashmir have legislatures and use CGST + SGST, not UTGST.

From 22 September 2025, most goods and services are taxed at 5% or 18%, with 40% on a select few items. Notification No. 9/2025–Central Tax (Rate), 17 September 2025, sets the matching central-tax halves (for example 2.5% and 9%). A few specified goods still use other rates. Check the current rate for your HSN or SAC. In the examples below, 18% splits as 9% + 9%, and 5% splits as 2.5% + 2.5%.

Place of supply is not just the billing address

Always find the place of supply under sections 10 to 13 of the IGST Act. Do not look only at the customer’s billing address, or only at the shipping address.

In short:

• For most goods that move, the place of supply is where the movement ends for delivery to the recipient.
• In a bill-to-ship-to case (goods delivered to one person on the direction of another), the place of supply is generally the principal place of business of the person who gives that direction (usually the “bill to” person), not the ship-to address alone.
• For many services, where both parties are in India, the place of supply is the location of the recipient. There are special rules for some services, such as those linked to immovable property or events.

A supply to or by an SEZ developer or an SEZ unit is treated as inter-State, even if the supplier and the zone are in the same State. Charge IGST, not CGST and SGST. Exports are also inter-State supplies.

How to calculate the tax

Intra-State supply (same State or same Union territory)

Split the total GST rate equally into CGST and SGST (or UTGST).

• CGST = taxable value × (GST rate ÷ 2) ÷ 100
• SGST or UTGST = taxable value × (GST rate ÷ 2) ÷ 100
• Invoice total = taxable value + CGST + SGST (or UTGST)

You can also write CGST as taxable value × GST rate ÷ 200. The two halves must be equal.

Example A — 18%, Delhi to Delhi (SGST applies)

Supplier is in Delhi. Place of supply is also in Delhi. Taxable value of goods is ₹1,00,000. GST rate is 18%, so 9% CGST and 9% SGST.

• CGST = 1,00,000 × 9 ÷ 100 = ₹9,000
• SGST = 1,00,000 × 9 ÷ 100 = ₹9,000
• Invoice total = 1,00,000 + 9,000 + 9,000 = ₹1,18,000

Example B — 5%, same State

Same facts, but the GST rate is 5%, so 2.5% CGST and 2.5% SGST.

• CGST = 1,00,000 × 2.5 ÷ 100 = ₹2,500
• SGST = 1,00,000 × 2.5 ÷ 100 = ₹2,500
• Invoice total = 1,00,000 + 2,500 + 2,500 = ₹1,05,000

If both the supplier and the place of supply were in a Union territory without a legislature, such as Chandigarh, the second half would be labelled UTGST, not SGST. The amounts would be the same.

Inter-State supply (different States or Union territories)

Do not split the tax. Charge the full rate as IGST.

• IGST = taxable value × GST rate ÷ 100
• Invoice total = taxable value + IGST

Example C — 18%, Maharashtra to Karnataka

Supplier is in Maharashtra. Place of supply is in Karnataka. Taxable value is ₹1,00,000. GST rate is 18%.

• IGST = 1,00,000 × 18 ÷ 100 = ₹18,000
• Invoice total = 1,00,000 + 18,000 = ₹1,18,000

Example D — 5%, different States

Same facts, GST rate 5%.

• IGST = 1,00,000 × 5 ÷ 100 = ₹5,000
• Invoice total = 1,00,000 + 5,000 = ₹1,05,000

The invoice total is the same as the matching intra-State example. Only the tax head changes.

If the price already includes GST

Do not simply subtract the rate from the inclusive price. The rate was added to the base, not to the total.

• Taxable value (base) = inclusive price × 100 ÷ (100 + GST rate)
• GST = inclusive price × GST rate ÷ (100 + GST rate)

GST is also inclusive price − base.

Example E — inclusive price ₹1,180 at 18%

• Base = 1,180 × 100 ÷ 118 = ₹1,000
• GST = 1,180 × 18 ÷ 118 = ₹180

The GST is ₹180, not ₹212.40 (which is what you would get if you took 18% of ₹1,180). If this is an intra-State supply, split that ₹180 equally into CGST ₹90 and SGST ₹90. If it is inter-State, the ₹180 is IGST.

Points to watch on your invoice

The GSTIN prefix is only a check, not the test

The first two digits of a GSTIN are the State code of that registration. Comparing those digits with the place of supply can be a useful check on a B2B invoice. It is not the legal test, and it can lead you wrong when:

• the place of supply is not the same as the customer’s GSTIN State (for example, some bill-to-ship-to supplies, or some services);
• you or the customer have GST registrations in more than one State — use the location of the establishment that is making or receiving that supply;
• the supply is to or by an SEZ developer or unit, which is always inter-State, even inside the same State.

Decide the tax head from the location of the supplier and the place of supply, then use the GSTIN prefix only to spot a mismatch.

Do not mix tax heads on the same supply

An intra-State invoice should not show IGST. An inter-State invoice should not split the tax into CGST and SGST (or UTGST).

If you pay tax under the wrong head, you still have to pay it under the correct head. You can claim a refund of the amount paid under the wrong head, under section 77 of the CGST Act or section 19 of the IGST Act. No interest is charged on the tax payable under the correct head. File the refund within the time in rule 89(1A) (generally two years from the date you pay under the correct head). This is not the same as a buyer’s ITC being “automatically rejected,” though a wrong head on the invoice can still cause problems in returns and credit. Correct the invoice and the tax head as soon as you find the mistake.

Zero-rated supplies: exports and SEZ

Exports, and supplies to an SEZ developer or SEZ unit for authorised operations, are zero-rated inter-State supplies under section 16 of the IGST Act. That does not only mean “charge zero and stop there.” You generally have two options:

1. Supply under a bond or Letter of Undertaking (LUT), without payment of IGST, and claim a refund of unutilised input tax credit (rule 96A).
2. Pay IGST and claim a refund of the IGST so paid.

For most goods and services, both options are available. Some notified goods are left out of the pay-IGST-and-refund route and may be supplied only under LUT or bond. Notification No. 01/2023–Integrated Tax, 31 July 2023, as amended by Notification No. 05/2023–Integrated Tax, 26 October 2023, effective 1 October 2023, is the notice to check for your item.

How to use the tools on Gauritanaya

The GST calculator adds GST to a price, or works back from a GST-inclusive amount. Use Add GST for a price before tax (GST = amount × rate ÷ 100). Use Remove GST for a price that already includes tax (base = amount × 100 ÷ (100 + rate)). Then choose Within state or Other state. The calculator does not decide the place of supply for you. If you choose “Within state,” it splits GST equally into CGST and SGST/UTGST. If you choose “Other state,” it shows the full amount as IGST. Preset rates are 3%, 5%, 18% and 40%, and you can type any other rate.

The GST invoice generator fills the tax on the invoice from the two States you select: your State, and the customer’s State, which the form uses as the place of supply. If those States are the same, it splits each rate into CGST and SGST, or into CGST and UTGST when the place of supply is a Union territory without a legislature (Andaman and Nicobar Islands, Chandigarh, Dadra and Nagar Haveli and Daman and Diu, Lakshadweep, and Ladakh). Delhi, Puducherry and Jammu and Kashmir stay SGST. If the States differ, it charges IGST. It warns you if a GSTIN prefix does not match the State you picked. It does not itself apply special place-of-supply rules (bill-to-ship-to, some services, or SEZ). For those supplies, set the place of supply correctly before you rely on the split.

To make the invoice itself, see How to create a GST invoice and a salary slip online. How the credit is used later is in How to utilise IGST, CGST and SGST credit.

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