---
title: "CGST vs SGST vs IGST: Differences, When to Apply, and How to Calculate"
description: "Every GST invoice must charge either CGST + SGST or IGST — never both. The choice depends on whether the supply is intra-state or inter-state. Here is a clear explanation with examples."
author: "Himanshu"
published: 2026-03-23T15:21:39.000Z
updated: 2026-09-06T05:36:05.563Z
url: https://blog.mybillplease.com/cgst-sgst-igst-difference
---
# CGST vs SGST vs IGST: Differences, When to Apply, and How to Calculate

## Key takeaways

- Intra-state supplies split GST equally into CGST and SGST; inter-state supplies charge the full rate as IGST. The total is identical.
- Compare the first two digits of the two GSTINs (or use the delivery state for B2C) to decide intra-state or inter-state.
- IGST credit can offset IGST, then CGST, then SGST; CGST and SGST credits can never be used against each other.
- Charging the wrong head sends tax to the wrong government and requires a credit note, a fresh invoice and a refund process.

## Understanding the Three Components of GST

India's GST is not a single tax — it is split into three components based on where the supply happens. **CGST (Central GST)** goes to the central government. **SGST (State GST)** goes to the state government. **IGST (Integrated GST)** goes to the central government for inter-state supplies, which then settles it with the destination state. Understanding which one to charge on your invoices is fundamental to GST compliance.

The rule is simple: **intra-state supply = CGST + SGST** (split equally). **Inter-state supply = IGST** (single tax, same total rate). The total tax percentage is the same — only the split changes. If the GST rate on an item is 18%, an intra-state invoice shows 9% CGST + 9% SGST. An inter-state invoice shows 18% IGST.

> **The wrong tax head is a common and costly error**
> 
> Getting this wrong is one of the most common GST compliance errors. Wrong tax head means wrong payment to the wrong government, which creates demand notices, interest, and complicated refund processes. We built [myBillPlease](https://www.mybillplease.com/signup) to handle this automatically: the system reads the state codes from your GSTIN and the customer's GSTIN, determines intra-state or inter-state, and applies the correct split. No manual calculation needed. Try our [GST calculator](https://www.mybillplease.com/tools/gst-calculator) to see both splits for any amount.

## CGST vs SGST vs IGST: Complete Comparison
When to charge what and where the money goes
| CGST | SGST / UTGST | IGST |
| --- | --- | --- |
| Full form | Central Goods and Services Tax | State / Union Territory GST | Integrated Goods and Services Tax |
| Governed by | CGST Act 2017 | SGST Act / UTGST Act | IGST Act 2017 |
| Applies to | Intra-state supplies | Intra-state supplies | Inter-state supplies + imports |
| Collected by | Central government | State government | Central government (settled with states) |
| Rate (if total GST = 18%) | 9% | 9% | 18% |
| On invoice | Shown with SGST | Shown with CGST | Shown alone |
| ITC utilisation | CGST → CGST, then IGST | SGST → SGST, then IGST | IGST → IGST, CGST, SGST (in order) |
| Place of Supply = Seller state? | Yes — intra-state | Yes — intra-state | No — inter-state |
| E-commerce B2C | If buyer in same state | If buyer in same state | If buyer in different state |

## How to Determine Intra-State vs Inter-State Supply

The determination is based on **Place of Supply** rules under the IGST Act. For goods, the Place of Supply is where the goods are delivered. For services, it is the location of the recipient.

**Intra-state (CGST + SGST):** When both the supplier location and the Place of Supply are in the same state. Example: You are in Mumbai (Maharashtra) and deliver goods to a customer in Pune (Maharashtra). Both in Maharashtra = intra-state = CGST + SGST.

**Inter-state (IGST):** When the supplier location and Place of Supply are in different states. Example: You are in Mumbai (Maharashtra) and deliver goods to a customer in Delhi. Different states = inter-state = IGST.

**How to identify the state:** The first two digits of the GSTIN are the state code. If your GSTIN starts with 27 (Maharashtra) and the customer's GSTIN starts with 07 (Delhi), it is inter-state. If both start with 27, it is intra-state. For B2C sales where the customer has no GSTIN, use the delivery address state.

In [myBillPlease](https://www.mybillplease.com/signup), you add customers with their GSTIN. The system extracts the state code and compares it with your business state. Every invoice automatically gets the correct CGST+SGST or IGST split. For [e-commerce sellers](/gst-for-ecommerce-sellers), this is critical because customers are in different states for every order. Use the [HSN code directory](https://www.mybillplease.com/hsn) to find the correct rates for your products.

## Practical Examples: Which Tax to Charge
- **Retail Shop — Local Sale** — You run a shop in Delhi (state code 07). Customer walks in and buys goods worth Rs 10,000. GST rate: 18%. Invoice shows: CGST 9% = Rs 900, SGST 9% = Rs 900. Total: Rs 11,800.
- **Online Sale — Different State** — You are in Karnataka (29). Shopify customer orders from Maharashtra (27). Goods shipped to Maharashtra. IGST 18% = Rs 1,800 on Rs 10,000. No CGST or SGST. Total: Rs 11,800.
- **Service to Same State Client** — You provide IT consulting from Bangalore (29) to a client also in Karnataka (29). Service fee: Rs 50,000. CGST 9% = Rs 4,500, SGST 9% = Rs 4,500. Total: Rs 59,000.
- **Service to Different State Client** — Same IT consulting from Bangalore (29) but client is in Mumbai (27). Service fee: Rs 50,000. IGST 18% = Rs 9,000. No CGST or SGST. Total: Rs 59,000. Same total, different tax head.
- **Export of Goods** — Export from India to USA. Exports are zero-rated under IGST Act. IGST rate = 0%. No CGST or SGST either. But you can claim ITC on inputs used for export and apply for refund.
- **Import of Goods** — Importing machinery from Germany. Imports attract IGST (not CGST+SGST) paid at customs. IGST 18% on assessable value + customs duty. This IGST is available as ITC in your GSTR-3B.

## ITC Utilisation Order: CGST, SGST, and IGST Credits

Input tax credit utilisation follows a specific order that you must understand to pay the correct amount under each head:

**IGST credit** must be used first against IGST liability. Any remaining IGST credit can be used against CGST liability, then SGST liability.

**CGST credit** must be used first against CGST liability. Any remaining CGST credit can be used against IGST liability. CGST credit CANNOT be used against SGST liability.

**SGST credit** must be used first against SGST liability. Any remaining SGST credit can be used against IGST liability. SGST credit CANNOT be used against CGST liability.

This order matters because cross-utilisation between CGST and SGST is not allowed. If you have excess CGST credit but a SGST liability, you cannot use the CGST credit for it — you must pay SGST in cash and carry forward the CGST credit. [Read our complete ITC guide](/input-tax-credit-guide) for more details on claiming and utilising credits correctly.

myBillPlease calculates the ITC utilisation order automatically in the [GSTR-3B report](/gstr-3b-filing-guide). The system splits your input credits by tax head and applies them in the correct sequence. Download the report and you see exactly how much to pay under each head.

> **Common CGST/SGST/IGST Errors and How to Avoid Them**
> 
> **Error 1: Charging IGST on intra-state supply.** If buyer and seller are in the same state, IGST is wrong. The tax goes to the central government instead of being split between central and state. This requires a reversal and re-payment under the correct heads. myBillPlease prevents this by auto-detecting the state from GSTIN.
> 
> **Error 2: Charging CGST+SGST on inter-state supply.** The reverse problem — SGST goes to your state government but should go to the buyer's state via IGST. Requires complicated corrections. Again, automated state detection eliminates this.
> 
> **Error 3: Using CGST credit against SGST.** Not allowed. Many businesses make this mistake when filing GSTR-3B manually. The portal rejects it but if you force-file with wrong utilisation, you create a demand.
> 
> **Error 4: Wrong state code for e-commerce customers.** For [B2C e-commerce sales](/gst-for-ecommerce-sellers), the Place of Supply is the delivery state. If you ship to the wrong state (e.g., billing address vs delivery address), the IGST vs CGST+SGST determination is wrong.
> 
> **Prevention:** Use billing software that reads GSTIN state codes and delivery addresses to auto-determine the correct tax type. [myBillPlease](https://www.mybillplease.com/signup) does this on every invoice — zero manual intervention.

**Auto-Calculate CGST, SGST, and IGST — Free**
myBillPlease reads GSTIN state codes and applies the correct tax split on every invoice. No manual calculation. Free plan available.

[Get Started Free](/signup)

## FAQ

### What is the difference between CGST, SGST, and IGST?

CGST (Central GST) is the central government's share of tax on intra-state supplies. SGST (State GST) is the state government's share on the same intra-state supplies. IGST (Integrated GST) is charged on inter-state supplies and goes to the central government, which then settles it with the destination state. For example, on an 18% GST item sold within the same state, the invoice shows 9% CGST plus 9% SGST. The same item sold to another state shows 18% IGST. The total tax amount is identical — only the government receiving the tax changes.

### When do I charge CGST + SGST vs IGST?

Charge CGST plus SGST when both you (the supplier) and the customer (or delivery location) are in the same state. This is called an intra-state supply. Charge IGST when you and the customer are in different states — this is an inter-state supply. The determination is based on Place of Supply rules under the IGST Act. For goods, the Place of Supply is the delivery location. For services, it is the recipient's location. Compare the first two digits of your GSTIN (your state code) with the customer's state code. Same state = CGST plus SGST. Different state = IGST.

### Is the total GST amount different for CGST+SGST vs IGST?

No, the total GST amount is exactly the same. The difference is only in how the tax is split between governments. If the GST rate is 18%, an intra-state invoice shows 9% CGST (Rs 900 on Rs 10,000) plus 9% SGST (Rs 900) totalling Rs 1,800. An inter-state invoice shows 18% IGST (Rs 1,800 on Rs 10,000). The customer pays the same total either way. The distinction matters only for government revenue distribution and for ITC utilisation order when filing returns.

### Can I use CGST credit to pay SGST liability?

No. CGST input tax credit cannot be used to pay SGST liability, and SGST credit cannot be used to pay CGST liability. This cross-utilisation is explicitly prohibited under the GST law. CGST credit can only be used against CGST liability first, then against IGST liability. SGST credit can only be used against SGST liability first, then against IGST liability. IGST credit is more flexible — it can be used against IGST, then CGST, then SGST liability. This utilisation order is enforced by the GST portal during GSTR-3B filing.

### What happens if I charge IGST instead of CGST+SGST by mistake?

If you charge IGST on what should have been an intra-state supply, the tax goes to the central government instead of being split between central and state. To correct this, you need to issue a credit note for the wrong invoice and create a new invoice with the correct CGST plus SGST split. The IGST paid needs to be adjusted through the refund mechanism, and CGST plus SGST needs to be paid separately. This creates administrative overhead and can trigger interest if the correction is delayed. Using billing software that auto-determines the tax type based on GSTIN state codes prevents this error entirely.

### How does IGST work for e-commerce sales?

For e-commerce sales, the Place of Supply for goods is the delivery address state — not the customer's billing address or registration state. If you are registered in Karnataka and ship to a customer in Maharashtra, it is inter-state and you charge IGST. If you ship to a customer in Karnataka, it is intra-state and you charge CGST plus SGST. This determination must happen for every order because e-commerce customers can be anywhere in India. myBillPlease with Shopify integration handles this automatically by reading the delivery state from each order and applying the correct tax split.

### Does UTGST replace SGST in Union Territories?

Yes, in Union Territories without a legislature — Chandigarh, Lakshadweep, Dadra and Nagar Haveli and Daman and Diu, and Andaman and Nicobar Islands — UTGST (Union Territory GST) replaces SGST. The rates and rules are identical to SGST. Intra-UT supplies attract CGST plus UTGST. Inter-state supplies from or to UTs attract IGST. For practical purposes, UTGST and SGST work the same way in invoicing and return filing. Delhi, Puducherry, and Jammu and Kashmir have their own SGST Acts as they have elected legislatures.