Jewellery bills confuse customers and even shop staff, because a single line combines weight, purity, the day's rate, making charges and tax. Getting it right protects your margin, your customer's trust — and your GST compliance. This is general information, not tax advice; confirm your invoicing with your CA.
The building blocks of a jewellery bill
- Net weight of the metal in grams (excluding stones).
- Purity — for gold, 22K (916), 18K (750), 14K (585) and so on; for silver, 925 or 999.
- Rate per gram for that purity on the day of sale.
- Making charges — per gram, as a percentage of metal value, or a fixed amount per piece.
- Stone or other charges, where applicable.
GST: 3% on the whole value, including making charges
The CBIC's sectoral FAQ on gems and jewellery states that GST is payable at 3% of the total transaction value of jewellery, whether the making charge is shown separately or not. The 5% rate applies to job work — for example, when a karigar or registered job worker charges a jeweller for making — not to the retail sale of finished jewellery. Within a state the 3% is split into CGST 1.5% and SGST 1.5%; for an inter-state sale it is IGST 3%.
Where discounts go
A discount given at the time of sale and shown on the invoice reduces the value on which GST is charged (Section 15(3) of the CGST Act). So subtract the discount before calculating GST, not after.
Old gold exchange and advances
When a customer gives old gold in exchange, its value is part of how they pay for the new jewellery. GST is calculated on the value of the new jewellery; the old-gold value and any advance are then deducted from the amount the customer pays. Record the old gold's weight, purity and value on the bill.
A worked example
| Line | Calculation | Amount |
|---|---|---|
| Metal value | 10.000 g × ₹7,250 (22K) | ₹72,500 |
| Making charges | 10.000 g × ₹600 | ₹6,000 |
| Less: discount | − ₹500 | |
| Taxable value | ₹78,000 | |
| CGST 1.5% + SGST 1.5% | 3% of ₹78,000 | ₹2,340 |
| Invoice value | ₹80,340 | |
| Less: old gold (4.000 g) | as valued at the counter | − ₹26,000 |
| Less: advance paid | − ₹10,000 | |
| Balance payable | ₹44,340 |
Rates are illustrative. Use the day's rate for the purity sold.
What the invoice should show
- Your name, address and GSTIN; invoice number and date; the customer's details.
- For each item: description, HSN code, net weight, purity, rate, making charges and value.
- The taxable value and the CGST/SGST (or IGST) amounts.
- Old gold, advance and balance, if any.
- For hallmarked jewellery, the hallmark details — BIS advises buyers to take a proper bill listing the hallmarked articles, which matters if there is ever a complaint. Each hallmarked piece carries a six-character HUID that customers can verify in the BIS CARE app.
Common billing mistakes
- Charging 5% GST on making charges in a retail sale.
- Deducting the discount after GST, which over-charges tax.
- Not recording old gold weight and purity.
- Rounding rates differently on the calculator and the invoice.
Getting the bills to your CA
At the end of the month your CA needs every invoice in the books — usually in Tally — with the taxable value and CGST/SGST separated, and cash and bank receipts kept apart. Re-typing invoices is slow and error-prone; exporting them from your billing software is not.
Infovion JMS calculates each line from weight, purity, rate and making charges, applies the discount before GST, prints a GST invoice with the CGST/SGST split, and exports the month's sales and receipts to Tally for your CA. See jewellery billing in JMS.
Sources: CBIC sectoral FAQ — Gems and Jewellery; BIS hallmarking FAQ; Section 15, CGST Act, 2017.
