Interstate vs Intrastate GST: Definitions, Examples & Tax Impact | Kallapotti Learn

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 Know when IGST applies (interstate) vs CGST+SGST (intrastate), how to determine place of supply, and how it affects your ITC and compliance.

  5 min read  Updated 16 September 2026  Ahopez Innovations Team InterstateIntrastateIGSTPlace of SupplyGST The type of GST charged — CGST+SGST or IGST — depends entirely on whether the supply is intrastate (within the same state) or interstate (between different states). Getting this wrong means you charge the wrong tax and face penalties.

## Intrastate vs Interstate: Quick Comparison

AspectIntrastate SupplyInterstate SupplyBuyer & Seller locationSame stateDifferent statesTax appliedCGST + SGST (50/50 split)IGST (full rate)Who collectsBoth Central & State GovtCentral Govt onlyExample (18% GST on ₹10,000)CGST ₹900 + SGST ₹900IGST ₹1,800ITC usage by buyerCGST credit offset CGST; SGST offset SGSTIGST credit offsets IGST/CGST/SGST## Key Rules for Place of Supply

-  Goods: place of supply = state where goods are delivered
-  Services (B2B): place of supply = location of registered recipient
-  Services (B2C): place of supply = location where service is performed
-  Online services: place of supply = location of recipient
-  Immovable property services: place of supply = where property is located
 Important If you charge CGST+SGST on an interstate supply (or IGST on an intrastate supply), the error must be corrected via a credit note and fresh correct invoice. Buyers cannot claim ITC on incorrectly taxed invoices.

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