GST-Compliant Invoicing for Recruitment Agencies: What Actually Changes

Most small placement agencies in India start out invoicing clients the same way they'd invoice anyone: a logo, an amount, a due date. Then a client's accounts team bounces the invoice back asking for a GSTIN, an SAC code, or a place of supply field that was never there. It's a small thing until it delays payment on a placement fee you've already earned.

Recruitment services are taxed like any other professional service

Placement and recruitment services fall under SAC 998513 (permanent placement services) or 998512 (executive search services), and like most professional services in India, they're taxed at 18% GST. That's not a special recruitment-industry rate, it's the standard services rate, but a lot of first-time agency invoices miss the SAC code entirely, which is often the actual reason a client's accounts team rejects an invoice, not the amount or the arithmetic.

This isn't tax advice. Your specific classification, exemptions, and filing obligations depend on your agency's registration and turnover, confirm the details with your CA. What follows is what the invoice itself needs to look like once your CA has confirmed those details.

What a GST-compliant placement invoice actually needs

• Your GSTIN and the client's GSTIN, both printed, both correct
• A sequential invoice number your agency doesn't reuse across financial years
• The SAC code for the specific service rendered
• Place of supply, which determines whether it's CGST+SGST or IGST
• A clear description of what was invoiced: which candidate, which role, which client, since disputes almost always start here

Where small agencies actually lose money

It's rarely the tax calculation. It's the invoice sitting in a founder's WhatsApp Sent folder with no reminder attached, or a placement fee split across three candidates with no per-candidate line item, so when a client disputes one placement the whole invoice is stuck. The fix isn't a better accountant, it's an invoice that's structured correctly the first time and chased automatically after.

Microsive ATS generates GST-aware invoices with per-candidate line items and overdue tracking on the dashboard, so the invoice a recruiter raises the day of a placement is already structured the way a client's accounts team expects it, and payment reminders go out from your own connected inbox without anyone having to remember to chase them.