Year-End GST Compliance Guide
- tax comply
- Mar 6
- 6 min read
1. Key GST Compliance Activities Before March 31, 2025
Compliance Activity | Description | Action Required | Deadline |
Letter of Undertaking (LUT) Submission ✈️ | Allows exporters to supply goods/services without paying Integrated GST (IGST). | File Form GST RFD-11 for FY 2025-26. | March 31, 2025 |
Input Service Distributor (ISD) Compliance 🏢 | Ensures proper distribution of Input Tax Credit (ITC) among multiple branches. | Apply for ISD registration if applicable. | April 1, 2025 |
GSTR-9C Late Fee Waiver 🏛️ | Waiver of late fees for delayed/non-filing of GSTR-9C for FY 2017-18 to FY 2022-23. | File pending GSTR-9C by March 31, 2025. | March 31, 2025 |
GST Amnesty Scheme 🏛️ | Waiver on penalties and interest for pending GST dues from previous financial years. | Pay outstanding tax and file application. | March 31, 2025 (Tax Payment) & June 30, 2025 (Application) |
GST Refund Application 💰 | Claim refund for excess ITC or tax paid. | File refund application for FY 2023-24 before the 2-year limit. | As per Section 54 |
New Invoice Series Implementation 📜 | Initiate a fresh numbering series for invoices and related documents. | Establish a new invoice series from April 1, 2025. | April 1, 2025 |
E-Invoicing Compliance 🔗 | Mandatory electronic invoicing for businesses with turnover exceeding ₹5 crore. | Ensure e-invoicing system is in place. | April 1, 2025 |
Reverse Charge Mechanism (RCM) Compliance 🔄 | Businesses must pay GST on certain services received. | Ensure timely RCM payment and ITC claim. | Ongoing |
Reconciliation of ITC and Outward Supplies 🔍 | Match books of accounts with GST returns (GSTR-1, GSTR-3B, GSTR-2B). | Conduct thorough reconciliation before return filing. | Ongoing |
Opting for Quarterly Return Monthly Payment (QRMP) Scheme 📊 | Allows small taxpayers to file returns quarterly and pay taxes monthly. | Opt for QRMP scheme if turnover ≤ ₹5 crore. | April 30, 2025 |
2. Detailed GST Compliance Procedures
A. Letter of Undertaking (LUT) Submission for Exports ✈️
Who Needs it?
Businesses engaged in zero-rated supplies, including exports and supplies to Special Economic Zones (SEZs), without payment of IGST.
Why it is important
Without an LUT, exporters must pay IGST upfront and later claim a refund, affecting cash flow.
How to File LUT:
1. Log in to the GST portal.
2. Navigate to 'Services' > 'User Services' > 'Furnishing Letter of Undertaking (LUT)'.
3. Fill in the required details in Form GST RFD-11.
4. Submit the form and download the acknowledgment.
Key Alert:
If LUT for FY 2024-25 was not applied, first apply for it with a condonation request before filing for FY 2025-26.
Once the LUT for FY 2025-26 is filed, applications for prior years cannot be made.
Deadline:
File the LUT for FY 2025-26 by March 31, 2025.
B. Compliance with Input Service Distributor (ISD) Provisions 🏢
Who Needs it?
Businesses with multiple GST registrations under the same PAN that receive common input services at a central location.
Why it is important
Proper distribution of ITC ensures that branches correctly claim credits, avoiding loss of ITC and non-compliance penalties.
ISD Requirements:
If a business has a head office receiving invoices for services used by multiple branches, it must register as an ISD.
The ISD must distribute ITC proportionally to branches based on their use of services.
The distributed ITC must be reflected in each branch's GST returns.
How to Comply:
Register as an ISD: Log in to the GST portal and apply for ISD registration.
Identify Common Input Services: Determine which services benefit multiple branches.
Maintain Accurate Records: Issue ISD invoices and track ITC allocation.
File Monthly Returns: Report ITC distribution in Form GSTR-6.
New Provisions Effective from April 1, 2025:
The Finance Act 2024 has expanded ISD provisions to include the distribution of common ITC.
Businesses receiving invoices for shared services must comply with ISD registration and credit distribution.
Key Benefits:
✅ Ensures accurate ITC allocation across different branches.
✅ Prevents ITC loss due to incorrect distribution.
✅ Helps in better tax planning and avoids disputes during audits.
Deadline:
Register as an ISD, if applicable, by April 1, 2025.
C. GSTR-9C Late Fee Waiver – Avail the Benefit Before March 31, 2025 🏛️
What It Is?
The Central Government, via Notification 08/2025-Central Tax, has waived late fees under Section 47 of the CGST Act for the delay or non-filing of GSTR-9C for FY 2017-18 to FY 2022-23, provided the return is filed before March 31, 2025.
Who is Eligible?
Taxpayers who were required to submit GSTR-9C (reconciliation statement) along with GSTR-9 (annual return) for any financial year from 2017-18 to 2022-23 but failed to do so.
Pending GSTR-9C forms for these years must be filed before March 31, 2025, to avail of the waiver.
Quantum of Waiver:
✅ Late fees for GSTR-9C will be restricted to the fees paid for GSTR-9 (if any).
✅ No additional late fees will be demanded separately for GSTR-9C.
✅ Any excess late fee beyond GSTR-9 penalties will be waived off.
What is GSTR-9C?
It is a self-certified reconciliation statement (from FY 2020-21 onwards).
It matches supplies declared in GSTR-9 with audited financial statements.
Who is Required to File GSTR-9C?
FY 2017-18: Businesses with turnover exceeding ₹2 crore were required to file GSTR-9C.
From FY 2018-19 onwards: The threshold was increased to ₹5 crore, which continues till FY 2023-24.
Action Required:
Businesses with pending GSTR-9C filings from 2017-18 to 2022-23 must submit them before March 31, 2025, to avoid penalties.
D. GST Amnesty Scheme – Relief from Penalties and Interest 🏛️
What It Is?
The GST Amnesty Scheme allows businesses with pending GST liabilities from FY 2017-18 to 2019-20 to clear their dues with reduced penalties and interest.
Who Benefits?
Taxpayers with outstanding GST liabilities due to late or missed filings, incorrect tax payments, or past non-compliance.
How to Avail the Amnesty Scheme?
Identify pending GST liabilities from FY 2017-18 to 2019-20.
Pay outstanding tax dues by March 31, 2025.
File necessary applications by June 30, 2025, to receive penalty waivers.
E. GST Refund Applications – Maximize Your Benefits 💰
Who Can Apply? Businesses eligible for a GST refund due to excess ITC, export transactions, or incorrect tax payments.
Types of Refunds:
Excess balance in the Electronic Cash Ledger.
Refund of unutilized ITC (exports without IGST, inverted duty structure).
Refund of wrongly paid GST (intra-state vs. inter-state errors).
Steps to File a Refund Claim:
1. Gather relevant documents (invoices, bank statements, and tax filings).
2. Log in to the GST portal and navigate to 'Services' > 'Refunds' > 'Application for Refund'.
3. Select refund type, enter details, and upload supporting documents.
4. Submit and track refund status.
Deadline: Refund applications must be filed within 2 years from the relevant tax period.
F. Implementing a New Invoice Series 📜
Why It’s Necessary? Establishing a fresh invoice series ensures compliance with GST regulations and maintains systematic record-keeping.
How to Structure the Invoice Series:
Use a unique prefix for different branches (e.g., DEL/2025/001, MUM/2025/001).
Maintain sequential numbering.
Update invoicing software and inform stakeholders.
Deadline: Implement a new series from April 1, 2025.
G. E-Invoicing Compliance – Digital Invoicing Mandates 🔗
Who Needs to Comply? Businesses with an annual aggregate turnover exceeding ₹5 crore.
New Changes from April 1, 2025:
Mandatory 30-day reporting timeline for businesses with turnover above ₹10 crore.
E-invoices must be uploaded to the Invoice Registration Portal (IRP).
How to Implement:
1. Register on the IRP.
2. Generate invoices with QR codes and IRN (Invoice Reference Number).
3. Maintain proper digital records.
H. GST TDS/TCS Compliance – Claiming Eligible Credits 🏦
Why It’s Important? Businesses must claim GST TDS/TCS credits to avoid unnecessary tax liabilities.
How to Claim:
Check available credits on the GST portal.
Navigate to Returns > TDS and TCS Credit Received.
Verify and accept the credits before return filing.
I. Reverse Charge Mechanism (RCM) – Ensuring Proper Compliance 🔄
Who Needs to Pay GST Under RCM? Businesses receiving services such as legal, security, rent-a-cab, sponsorship, and import of services.
Compliance Steps:
Identify RCM-applicable services.
Pay GST under RCM and claim ITC.
Issue self-invoices and maintain records.
J. GST Reconciliation – Avoid Discrepancies and Penalties 🔍
Key Areas to Reconcile:
Outward Supplies: Match invoices with GSTR-1 and GSTR-3B.
Inward Supplies: Ensure ITC in GSTR-2B matches books of accounts.
Action Steps:
§ Regularly reconcile ITC and tax payments.
§ Correct discrepancies before filing annual returns.
K. Opting for Composition Scheme & QRMP – Tax Simplification Options 📊
Composition Scheme:
Available for businesses with turnover up to ₹1.5 crore.
File Form GST CMP-02 before April 1, 2025.
QRMP Scheme:
Available for businesses with turnover up to ₹5 crore.
Opt-in between Feb 1, 2025, to April 30, 2025.
Final Takeaways ✅
This guide ensures that businesses complete their GST obligations smoothly, avoiding penalties and maximizing tax benefits.
If you need expert assistance in managing your GST compliance, filing returns, or resolving tax-related queries, TaxComply is here to help. For professional support, contact us at CONNECT@TAXCOMPLY.IN. Our team of tax professionals is ready to assist you in navigating GST regulations efficiently and ensuring hassle-free compliance.
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