Stock transfer
Branch transfer
A stock transfer is a movement of goods between two locations of the same business, and under GST a transfer between locations registered under different GSTINs is a taxable supply even though no sale has taken place.
Within one state and one GSTIN, a transfer is an internal movement: stock leaves one godown and arrives in another, with a delivery challan and, above the threshold, an e-way bill.
Across states it is different, and this surprises people. Locations registered under different GSTINs are distinct persons under GST, so moving your own goods between them is a supply, requires a tax invoice, and attracts IGST — which the receiving branch then claims as input tax credit. It is broadly neutral in tax terms but it is not paperwork-free.
Operationally, the risk in transfers is stock that has left one location and not yet been confirmed at the other. Goods in transit are real, countable and frequently invisible in systems that decrement the source on dispatch and increment the destination on receipt with nothing in between.
Key facts
- Transfers within the same GSTIN are not supplies and need no tax invoice.
- Transfers between different GSTINs of the same business are taxable supplies under IGST.
- A delivery challan is required for movement not involving a supply.
- E-way bill rules apply to transfers as they do to sales, above the value threshold.
- Goods in transit should be visible as a distinct state, not implied by a gap.
Who this affects
Any business operating more than one warehouse, shop or branch.
How YarnTally handles it
Transfers move stock between godowns with the movement recorded end to end, and every change is written to an immutable audit log.
See what else it doesReviewed September 2026. This is general information about how these rules work, not tax or legal advice, and thresholds and due dates do change. Check your own position with your chartered accountant before acting on it.