GST: answers to common questions

Question 1

When do I have to register for GST?

Accepted Answer

In Uttar Pradesh and most states, registration is required once your aggregate turnover in a financial year crosses ₹40 lakh if you supply only goods, or ₹20 lakh if you supply services. Some states have lower limits. Some businesses must register whatever their turnover, for example inter-state sellers of goods, most e-commerce sellers, casual dealers and those liable under reverse charge.

Question 2

What are the GST rates after 22 September 2025?

Accepted Answer

From 22 September 2025, most goods and services fall in two slabs, 5% and 18%, with a 40% rate for a short list of luxury and demerit goods and nil for exempt items. The 12% and 28% slabs were removed. Special rates such as 3% on gold continue. The GST Council made no rate change at its meeting on 8 October 2026. Always check the notified rate for your item's HSN or SAC code.

Question 3

Do online sellers and businesses making inter-state supplies need GST registration below the threshold?

Accepted Answer

Sellers of goods through e-commerce platforms must register whatever their turnover. The exception, since 1 October 2023, is small sellers of goods within their own state, who can sell through an e-commerce operator with only a PAN-based enrolment. Inter-state supply of goods needs registration from the first rupee. Service providers below the threshold need not register, even for inter-state or online supplies, except for services on which the platform pays the tax.

Question 4

Who can opt for the GST composition scheme, and what are its rates and limits?

Accepted Answer

Manufacturers, traders and restaurants with turnover up to ₹1.5 crore in the previous year (₹75 lakh in some special-category states) can pay GST at a flat 1%, or 5% for restaurants. Service providers up to ₹50 lakh can pay 6%. Composition taxpayers cannot charge GST, claim input tax credit, or make inter-state sales. They opt in before the year starts, pay quarterly by CMP-08 and file GSTR-4 once a year.

Question 5

What documents are needed for GST registration, and why are applications rejected?

Accepted Answer

You need PAN, Aadhaar of the proprietor, partners or directors, photographs, proof of constitution, proof of the place of business (with a rent agreement and the owner's consent if rented) and bank details. Most rejections come from unclear or mismatched address proof, a missing consent letter, a failed site visit, or no reply to a REG-03 query within 7 working days. Low-risk applicants now get registration in three working days.

Question 6

How is GST registration cancelled, and how can a cancelled registration be revived?

Accepted Answer

You can apply to cancel your registration in REG-16 when you close the business or are no longer liable. The officer can cancel it for reasons such as not filing returns, after a show cause notice in REG-17. A cancelled registration can be restored by applying in REG-21 within 90 days of the cancellation order, after filing all pending returns and paying the dues. The Commissioner can extend this by up to 180 days.

Question 7

What are the due dates for GSTR-1 and GSTR-3B, and what happens if I file late?

Accepted Answer

Monthly filers file GSTR-1 by the 11th and GSTR-3B by the 20th of the following month. Small taxpayers under the QRMP scheme file GSTR-1 by the 13th after each quarter and GSTR-3B by the 22nd or 24th (24th in Uttar Pradesh). Late filing costs a late fee of ₹50 a day (₹20 for nil returns), subject to caps, plus 18% interest on tax paid late. Returns cannot be filed more than three years after the due date.

Question 8

Who must file GSTR-9 and GSTR-9C, and by when?

Accepted Answer

GSTR-9, the annual return, is due by 31 December after the financial year: for FY 2025-26, by 31 December 2026. It is optional if your aggregate turnover is up to ₹2 crore, and compulsory above that. GSTR-9C, a self-certified reconciliation of the annual return with audited accounts, is also required if turnover exceeds ₹5 crore. Late fee runs from 1 January 2027: ₹50 a day for turnover up to ₹5 crore, ₹100 up to ₹20 crore and ₹200 above, subject to caps.

Question 9

What is the QRMP scheme, and should I opt for it?

Accepted Answer

QRMP (Quarterly Return, Monthly Payment) lets taxpayers with aggregate turnover up to ₹5 crore in the previous financial year file GSTR-1 and GSTR-3B every quarter instead of every month, while paying tax monthly in form PMT-06 by the 25th. It reduces filings, but if your customers need to claim credit monthly you may have to upload B2B invoices through the optional IFF by the 13th.

Question 10

What are the GST late fees and interest for late returns and payments?

Accepted Answer

GSTR-1 and GSTR-3B carry a late fee of ₹50 a day (₹20 for a nil return), capped at ₹500 for nil returns and ₹2,000, ₹5,000 or ₹10,000 for others depending on turnover. The annual return GSTR-9 carries ₹50 to ₹200 a day, capped as a percentage of turnover. Tax paid late attracts interest at 18% a year on the net amount paid in cash, and credit wrongly availed and used attracts 18% too. Late fees must be paid in cash.

Question 11

Who must issue e-invoices under GST, and what is the 30-day rule?

Accepted Answer

A business whose aggregate turnover exceeded ₹5 crore in any year since 2017-18 must report its B2B invoices, credit and debit notes, and exports to the Invoice Registration Portal and get an IRN before issuing them. Since 1 April 2025, a business with turnover of ₹10 crore or more must report each invoice within 30 days of its date. An invoice without a valid IRN is not a valid tax invoice, and the buyer cannot claim credit on it.

Question 12

When is an e-way bill required, and how long is it valid?

Accepted Answer

An e-way bill is needed to move goods worth more than ₹50,000 in a consignment, including tax. Some states set a different limit for movement within the state. It has Part A (invoice details) and Part B (vehicle). It is valid for one day for every 200 km, and can be extended, up to 360 days in all. Since 1 January 2025, it cannot be generated on a document more than 180 days old.

Question 13

What conditions must I meet to claim input tax credit under GST?

Accepted Answer

You must hold a valid tax invoice, have received the goods or services, see the invoice in your GSTR-2B, the supplier must have paid the tax, and you must file your own return. Claim it by 30 November after the end of the financial year, or the annual return date if earlier. Blocked items under section 17(5), such as most motor vehicles and food, never qualify.

Question 14

Why does the input tax credit in my GSTR-2B differ from my books, and how do I reconcile it?

Accepted Answer

GSTR-2B shows only invoices your suppliers have reported and you have accepted (or not rejected) on the Invoice Management System, for that period. Differences arise when suppliers file late or wrongly, file quarterly, or when you book purchases in a different month. You can claim only what appears in GSTR-2B, so reconcile invoice by invoice every month before filing GSTR-3B, follow up with suppliers, and keep the working.

Question 15

What is the time limit for claiming input tax credit, and what did the 2024 amendments change?

Accepted Answer

Credit for an invoice of a financial year must be claimed by 30 November of the following year, or the date you file the annual return, if earlier (section 16(4)). In 2024 two relaxations were added with effect from 1 July 2017: credit for FY 2017-18 to 2020-21 claimed in returns filed up to 30 November 2021 is valid (section 16(5)), and credit can be claimed after a cancelled registration is revoked (section 16(6)).

Question 16

On which purchases is GST input tax credit blocked under section 17(5)?

Accepted Answer

Credit is blocked on motor cars and other vehicles for up to 13 people (unless you deal in them, transport passengers or run a driving school), and on food, catering, beauty, health and club services, life and health insurance, and leave travel for employees. It is also blocked on construction of a building on your own account, except plant and machinery, and on goods lost, stolen, written off, or given as gifts or free samples. Personal use and CSR spending are blocked too.

Question 17

When must I reverse input tax credit because the supplier has not paid tax, or I have not paid the supplier within 180 days?

Accepted Answer

If you do not pay the supplier the value and tax within 180 days of the invoice date, reverse the credit in GSTR-3B, with interest if it was used; you can take it again when you pay. If the supplier has not filed GSTR-3B for the period by 30 September after the year, reverse the credit by 30 November; reclaim it once the supplier files. Credit must in any case appear in your GSTR-2B.

Question 18

How does input tax credit on capital goods work under GST?

Accepted Answer

GST paid on capital goods used in business can be claimed in full in the month of receipt, if the asset is used for taxable supplies and you do not claim depreciation on the tax component. If it is used partly for exempt supplies, the credit is reversed over 60 months. If you sell the asset, you pay the higher of the credit taken (less 5 percentage points for each quarter of use) and the tax on the sale price.

Question 19

How do I reply to a GST show cause notice (DRC-01)?

Accepted Answer

File the reply in form DRC-06 on the GST portal within the time given in the notice, usually 30 days, with documents for every point. Ask for a personal hearing. If you accept part of the demand, pay it with interest through DRC-03: for periods from FY 2024-25, paying tax and interest within 60 days of a non-fraud notice ends the case without penalty.

Question 20

Can I appeal to the GST Appellate Tribunal, and what is the time limit?

Accepted Answer

Yes. The GST Appellate Tribunal (GSTAT) began functioning in September 2025 and hears second appeals against orders of the Appellate Authority (Commissioner (Appeals)). File online on the GSTAT portal, generally within three months of the date the appellate order is communicated, with a pre-deposit of 10% of the tax still in dispute (up to ₹20 crore each for CGST and SGST). The special window for older orders closed on 31 July 2026.

Question 21

How do I file a first appeal against a GST order, and how much is the pre-deposit?

Accepted Answer

File form APL-01 online before the Appellate Authority within three months of the date the order was communicated (a further one month can be allowed for sufficient cause). You must pay the tax, interest and penalty you admit, and 10% of the disputed tax, up to ₹20 crore each for CGST and SGST. For a penalty-only order, the pre-deposit is 10% of the penalty. Once paid, recovery of the rest is stayed while the appeal is pending.

Question 22

What is the difference between GST demands under sections 73, 74 and 74A, and what was the section 128A waiver?

Accepted Answer

Section 73 covered demands without fraud and section 74 those with fraud, wilful misstatement or suppression, for 2017-18 to 2023-24. From 2024-25, both are covered by section 74A: a notice within 42 months of the annual return due date and an order within 12 months of the notice. Penalties fall if you pay early. Section 128A waived interest and penalty on section 73 demands for 2017-18 to 2019-20 where the tax was paid by 31 March 2025.

Question 23

Can the GST department attach my bank account, and what can I do about it?

Accepted Answer

Yes. Under section 83, the Commissioner can provisionally attach a bank account or other property while proceedings such as an audit, inspection or demand are pending, if he believes it is needed to protect revenue. The attachment lapses after one year. You can object within 7 days and must be heard. Separately, after a demand is confirmed and unpaid, the officer can recover it directly from your bank under section 79.

Question 24

When can I claim a GST refund, and how long does it take?

Accepted Answer

Refunds are allowed for exports and supplies to SEZs, for accumulated credit due to an inverted duty structure, for excess cash in the electronic cash ledger, and in a few other cases. File RFD-01 within two years of the relevant date. Ninety per cent of a refund on zero-rated supplies, and since October 2025 on inverted duty claims, can be sanctioned provisionally within 7 days. The final order is due within 60 days, after which interest is payable.