Here's a question that trips up more studios than you'd think: you close a lovely villa project in Goa, but your client is a company registered in Bengaluru. Your studio is registered in Mumbai. When you raise the invoice, do you charge CGST + SGST, or IGST?
Most designers guess. And guessing wrong on GST isn't a small thing. It messes up your client's input tax credit, it can invite a notice, and it makes you look sloppy in front of a paying customer. The good news: the rule that decides this is called place of supply, and once you understand it, it's actually simple.
Let me break it down the way I wish someone had explained it to me.
What "place of supply" actually means
GST is a destination-based tax. That's the whole philosophy. The tax should land where the service is consumed, not where you happen to sit.
To make that work, the law needs two pieces of information for every invoice:
- Location of the supplier, that's you, the studio. Usually the state where you're GST-registered.
- Place of supply, the state where the service is treated as being delivered or consumed.
Compare those two. If both are in the same state, it's an intra-state supply, and you charge CGST + SGST (split half-half, so 9% + 9% for an 18% service). If they're in different states, it's an inter-state supply, and you charge IGST (the full 18% as one line).
That's the entire game. Same state = CGST+SGST. Different states = IGST. Everything else is just figuring out what the place of supply is for a given job.
The default rule for design services (B2B)
For most professional services, and interior design and architecture consultancy fall here, the general rule under Section 12 of the IGST Act is straightforward for business clients.
When your client is registered under GST, the place of supply is simply the location of that registered client. Their principal place of business, the address on their GSTIN.
So go back to my Goa example. If your studio is in Mumbai (Maharashtra) and your client is a company registered in Bengaluru (Karnataka), the place of supply is Karnataka. Different state from you. That's IGST. It doesn't matter that the actual villa is in Goa, because for a registered client the rule points to their registration state, not the site.
This catches people out constantly. Studios assume "the project is in Goa, so it's a Goa supply." For a registered B2B client, it's not. Follow the GSTIN.
If your client is unregistered (a private homeowner doing up their flat, no GST number), the default flips to the address on record, wherever you've captured their address in your documentation. So keep that address field filled in properly on every enquiry.
The big exception: work related to immovable property
Now here's the part that specifically bites interior and architecture studios, so read this bit twice.
There's a special rule for services directly related to immovable property. This covers architects, interior decorators, and anyone whose service is tied to a specific building or land. For these, the place of supply is the location of that immovable property, the site itself.
So which rule wins? The general "follow the client's GSTIN" rule, or the "follow the site" rule?
The honest answer is that this is one of the genuinely debated areas of GST, and it depends on what you're actually supplying:
- If you're providing pure design consultancy, drawings, 3D views, space planning, a spec sheet the client executes themselves, many practitioners treat this under the immovable-property rule and use the site location as place of supply.
- If your engagement is broader project work tied to a registered business client, the general B2B rule pointing to their registration often applies.
Because reasonable professionals differ here, my practical advice is simple: decide your position per project, write it down, and be consistent. Don't charge CGST+SGST on one villa and IGST on an identical one next door. If a job is large or unusual, a five-minute call with your CA is cheaper than a wrong filing. I've walked through the broader picture of who pays what in GST for Interior Designers in India: A Plain-English Guide, and it pairs well with this.
Worked examples so it actually sticks
Let me run a few real-world combinations. Assume design services at 18%.
1. Mumbai studio, Mumbai homeowner, flat in Mumbai. Everything in Maharashtra. Intra-state. CGST 9% + SGST 9%. Easy.
2. Mumbai studio, registered client in Delhi, office fit-out in Delhi. Client registered in Delhi, site in Delhi, you in Maharashtra. Either rule points outside your state. IGST 18%.
3. Mumbai studio, registered client in Delhi, but the site is a bungalow in Pune (Maharashtra). This is the tricky one. Under the general B2B rule, place of supply = client's registration = Delhi = IGST. Under the immovable-property reading, place of supply = site = Pune = CGST+SGST. Pick your position based on the nature of the contract, document it, stay consistent. When you're deep in these cross-border jobs, my note on Handling Interstate Projects and IGST for Design Studios goes further.
4. Bengaluru studio, unregistered homeowner in Bengaluru, flat in Bengaluru. All Karnataka. CGST + SGST.
5. Bengaluru studio, unregistered client whose flat is in Hyderabad. Immovable property in Telangana. Site rule points to Telangana. Different state. IGST.
See the pattern? You're always doing the same two-step: figure out the place of supply, then compare it with your own state.
Why getting this wrong actually hurts
If you charge the wrong split, three bad things can happen.
First, your client can lose input tax credit. If you charge IGST when it should've been CGST+SGST (or the reverse), their accountant may struggle to claim it cleanly, and now you're the vendor causing them grief. For a corporate client, that's a reputation hit.
Second, you file wrong. Your GSTR-1 reports inter-state and intra-state supplies differently. Mislabel a supply and your returns don't tie out, which is exactly the kind of mismatch that draws attention.
Third, fixing it later is painful. Issuing a credit note and re-invoicing after payment has landed is a hassle nobody enjoys, especially when an advance is involved. Speaking of which, if you take booking amounts up front, and most of us do, get the tax treatment right from rupee one; I covered that in How to Handle Client Advances and GST the Right Way.
A simple checklist before you raise any invoice
Run this in your head (or better, let your software run it) every single time:
- Is the client registered or unregistered? Ask for the GSTIN up front, always.
- What's the place of supply, client's registration state, the site state, or the address on record?
- Is that the same state as my studio's registration, or different?
- Same state → CGST + SGST. Different → IGST.
- Have I put the client's correct GSTIN and state code on the invoice?
The state code matters, that two-digit code (27 for Maharashtra, 29 for Karnataka, 07 for Delhi) has to match the GSTIN and the tax split, or your invoice is internally inconsistent. A proper invoice format handles this for you; I laid out the full anatomy in How to Raise a GST-Compliant Invoice for Design Work. And once GST is sorted, don't forget your client may also deduct TDS on your fee, worth knowing the basics from TDS Basics Every Interior Designer Should Know so your receivables reconcile.
Let the software carry this weight
Honestly, this is the kind of rule you shouldn't be re-deriving on every invoice at 11pm on the 30th of the month. You'll make a mistake eventually. The reliable fix is to capture the client's GSTIN and state once, decide your place-of-supply position for that project once, and then let your invoicing tool apply the correct CGST+SGST or IGST split automatically forever after.
That's exactly why we built GST logic into Designa. Your quote turns into a GST invoice, the client's state drives whether it's an intra-state or inter-state supply, the split is applied for you, and it all syncs cleanly to Tally and Zoho Books so your CA isn't chasing you. One connected workspace from enquiry to spec to approval to invoice to Razorpay collection, no more copy-pasting into a separate accounting sheet and hoping the tax is right.
The whole studio, up to 10 members, unlimited free client logins, done-for-you onboarding and data migration, one flat founding price of ₹2,299 + GST per year, with a 7-day money-back guarantee. Poke around the real thing at https://demo.designa.work, and when you're ready to stop guessing on tax splits, grab the founding offer at [https://go.designa.work](https://go.designa.work).