From July 2025, the Government of India has introduced significant updates in GST return filing procedures, aimed at tightening compliance, reducing fake invoicing, and improving transparency in tax reporting. These changes impact both monthly filers under GSTR-3B and small businesses under QRMP.
Key GST Return Changes to Note:
Mandatory E-Invoice Matching:
Taxpayers must now ensure their GSTR-1 invoices match with e-invoices uploaded on the Invoice Registration Portal (IRP). Mismatches may result in denial of Input Tax Credit (ITC).
Restricted ITC for Non-Compliant Vendors:
Buyers can claim ITC only if suppliers have filed GSTR-1 and tax is reflected in GSTR-2B. This rule places more responsibility on businesses to verify vendor compliance regularly.
Auto-Populated GSTR-3B:
The government will now auto-populate GSTR-3B filings from GSTR-1 and GSTR-2B. Businesses are advised to cross-check values carefully, as manual edits could trigger scrutiny.
Penalty for Delayed Filing:
Late filing of GST returns will now attract automated penalties and interest, calculated per day of delay. There’s also a renewed push to suspend GSTINs of repeat defaulters.
Quarterly Updates for Composition Scheme:
Taxpayers under the Composition Scheme are now required to submit sales data quarterly, along with a simplified tax payment mechanism.
India Advocacy’s Advice:
These changes demand stricter internal accounting, vendor coordination, and timely filings. Our experts recommend:
Automating reconciliation
Performing regular ITC audits
Keeping updated with supplier filing behavior
