Compliance is an integral part of the indirect tax verse, to align the existing financial processes inside a business entity with the latest requirements of law, being updated is vital.
These include renewals, reconciliations, and adherence to updated regulatory requirements.
A thorough reconciliation of GST returns with financial statements is crucial to avoid discrepancies. Mismatches between GST filings and books of accounts may lead to notices, penalties, or even denial of ITC claims. Businesses should ensure all corrections and adjustments are made before filing their annual return.
GST Appeals & Appellate Procedures Click here
From April 1, 2025, the revised definition of Input Service Distributor (ISD) includes offices receiving taxable services on behalf of multiple branches. Businesses receiving centralized services must register under ISD to distribute Input Tax Credit appropriately across their different GST registrations.
Businesses engaged in international trade must ensure that their Importer Exporter Code (IEC) remains active. The Directorate General of Foreign Trade (DGFT) mandates that IEC details be updated annually, with the deadline set for June 30, 2025. Non-compliance may lead to the deactivation of the IEC, disrupting import-export operations.
The Amnesty Scheme for taxpayers facing penalties and interest on past non-compliance had a payment deadline of March 31, 2025. However, applications for relief under Section 128A can still be submitted until June 30, 2025. Businesses that missed the payment deadline must act swiftly to take advantage of this last opportunity.
GST Manual (Acts & Rules) Click here
Entities with an annual turnover of ₹5 crore or more must report goods and services using a six-digit Harmonized System of Nomenclature (HSN) code in invoices, e-way bills, e-invoices, credit/debit notes, and GST returns. This ensures accurate classification of goods and services, facilitating better compliance and tax administration.
Businesses availing Input Tax Credit (ITC) for both taxable and exempt supplies must perform an annual recalculation and reversal by September 2025. Any additional ITC liability identified post-reconciliation will attract interest charges from April 1, 2025. Proper review and timely adjustments help businesses prevent unnecessary interest costs.
As per GST regulations, businesses must introduce a new invoice series for each financial year. This ensures proper documentation and smooth reconciliation during audits. Implementing a well-structured invoice numbering system helps businesses comply with annual reporting requirements and avoid errors in GST filings.
GST Appeals & Appellate Procedures Click here
Businesses engaged in exports or Special Economic Zone (SEZ) supplies without payment of tax must renew their Letter of Undertaking (LUT) annually. Failure to do so may lead to the imposition of Integrated GST (IGST) on such transactions. While missing the deadline is a procedural lapse, businesses can still file for renewal to continue availing tax exemptions.
GST compliance requires businesses to stay updated on regulatory changes and deadlines. Failing to adhere to key requirements can result in penalties, interest charges, and business disruptions.
By actively addressing these compliance pain points, businesses can have smooth operations without unnecessary legal complications in FY 2025-26.
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