Discounts after the sale: a GST credit note is now enough, from 1 November 2026

Notification 03/2026-Central Tax brings sections 153 to 155 of the Finance Act, 2026 into force from 1 November 2026.

Discounts given after the sale Copy link

Under the old wording, a discount given after supply could reduce the GST only if it was agreed before or at the time of supply and linked to specific invoices. The new section 15(3)(b) asks for two things: the supplier issues a credit note for the discount, and the buyer reverses the input tax credit that relates to it. Section 34(1) now expressly allows a credit note for such a discount.

Refunds Copy link

• Provisional refund for inverted duty (section 54(6)). The 90% provisional refund, earlier only for zero-rated supplies, now also covers refunds of credit piled up because inputs carry a higher rate than the output.
• Exports with tax paid (section 54(14)). The restriction in this sub-section no longer applies to refunds of tax paid on goods exported.

What to do Copy link

For discounts given from 1 November, issue the credit note in your own name, show it in GSTR-1, and make sure the buyer accepts it in the Invoice Management System so that its credit is reversed. Keep the discount scheme and the working on file. If your products sell at a lower rate than your inputs, ask about the provisional refund on your next claim.

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