Bill of Supply

A Bill of Supply is a GST document you issue to customers when you cannot raise a regular tax invoice. For example, this applies if you supply exempted goods or services, or if you are registered under the Composition Scheme. Unlike a tax invoice, a bill of supply does not carry any tax component. In Zoho Billing, a bill of supply is created and managed from within the Invoices module using a dedicated transaction number series, so you can handle it alongside your tax invoices while staying compliant with GST rules.

When to Use a Bill of Supply

Under GST, a bill of supply replaces a tax invoice in scenarios where tax cannot be charged. Use a bill of supply in Zoho Billing when any of the following applies:

You are a Composition Scheme dealer and are not permitted to collect GST from your customers.
You are supplying exempted goods or services on which GST is not levied.
You are supplying goods or services under a nil-rated or non-taxable category.
You are a supplier of exports or zero-rated supplies where a Bill of Supply is applicable in place of a tax invoice.

Scenario: Zylker Organics is a small business registered under the GST Composition Scheme. Because Zylker cannot charge GST on its sales, Patricia, the accounts executive, issues a bill of supply for every sale instead of a regular tax invoice. She uses Zoho Billing to record each bill of supply, track balance due, and send payment reminders.

How a Bill of Supply Differs From a Tax Invoice

A Bill of Supply differs from a tax invoice in three ways:

Bill of Supply uses a separate number series (for example, BOS-) to stay compliant with GST numbering requirements.
Item table does not include a Tax column. You cannot apply tax rates to line items, or charge transaction-level taxes such as TCS.
The document is labelled Bill of Supply at the top of the PDF, distinguishing it from a tax invoice.

Apart from these differences, a Bill of Supply behaves exactly like a regular tax invoice.

Enable Bill of Supply

Before creating a bill of supply, make sure you have enabled the option under Settings.

To enable Bill of Supply:

Go to Settings.
Click General under Setup & Configurations in the Organization Settings pane.
Mark Bill Of Supply under Select the modules you would like to enable.
Click Save.

Once enabled, set up a dedicated number series before you start creating bills of supply.

Set Up a Number Series for Bill of Supply

After enabling Bill of Supply, set up a dedicated transaction number series with a distinct prefix so that your bills of supply are numbered independently of your tax invoices.

Prerequisite: To configure the transaction number series, you must be an **Admin**, or your role in Zoho Billing must have permission to modify **Invoice** preferences.

Here’s how to create a number series for bill of supply:

Go to Settings.
Select Transaction Number Series under Customization in the Organization Settings pane.
Click a new series or edit an existing one.
In the Bill Of Supply field, enter a Prefix (for example, BOS-), and the Starting Number this series should start from.
Click Save.

The new series will be used while creating a bill of supply. Once the number series is configured, you can create a bill of supply from the Invoices module.

Create a Bill of Supply

Here’s how to create a new bill of supply:

Go to Sales and select Invoices.
Click the dropdown next to + New and select New Bill Of Supply.
Enter the required details.
Click Save as Draft to review it later, or Save and Send to email it to the customer immediately.

Other Actions

A bill of supply is managed within the Invoices module, so all standard invoice actions apply to it as well. You can record payments, download or print the document, attach files, clone, void, write off, or delete a bill of supply, using the same steps as for a regular tax invoice. Refer to the following articles for more details: