GSTR-1 Return Filing: Rules, Due Date, Format, Eligibility & Penalties

Accurately filing GST returns is essential to remain compliant with India’s taxation framework. Among the various forms under GST, GSTR-1 plays a vital role for businesses of all sizes. It serves as a mirror of your sales transactions and directly impacts how your clients claim input tax credits. Whether you are a small trader or a growing enterprise, you have to understand that GSTR-1 isn't just a legal requirement; it is essential for smooth operations and building trust with your customers. In this article, you will know about the key rules, due dates, eligibility criteria, format, and penalties related to GSTR-1 filing.

What is GSTR-1?

GSTR-1 is a return that every regular GST-registered taxpayer must file either monthly or quarterly, depending on their turnover and chosen filing frequency. The GSTR-1 return includes complete information about outward supplies, which means the sales made by the business during a specific period.

It is mandatory for most registered businesses under GST, except for a few special cases like composition dealers or Input Service Distributors (ISDs), who have separate return forms.

GSTR-1 is divided into several sections also known as tables, where each section captures specific types of information related to sales transactions. The GSTR-1 return comprises the following key sections:

• 15A I - For sales to registered persons (B2B)
• 15A II - For sales to unregistered persons (B2C)

GSTR-1 return filing accurately is crucial, as the information provided is used by buyers to claim Input Tax Credit (ITC). It also helps maintain transparency and avoid mismatches in the GST system.

GSTR-1 Return Filing: Due Date

The deadline for filing GSTR-1 depends on the taxpayer’s annual turnover and whether they have chosen the Quarterly Return Filing and Monthly Payment (QRMP) scheme.

1. Monthly Filers (Turnover above Rs 5 crore or not opted for QRMP)

Businesses with an annual turnover of more than Rs 5 crore must file GSTR-1 every month. The due date is the 11th of the next month after the reporting month.

For example:

• January 2025 return: Due by 11th February 2025
• February 2025 return: Due by 11th March 2025, etc.

2. Quarterly Filers (Turnover up to Rs 5 crore under QRMP Scheme)

If a business has a turnover up to Rs 5 crore and opts for the QRMP scheme, GSTR-1 needs to be filed quarterly, by the 13th of the month following the quarter.

For example:

• October–December 2024: Due by 13th January 2025
• January–March 2025: Due by 13th April 2025
• April–June 2025: Due by 13th July 2025, etc.

Important Note:

According to the amendment to Section 37 of the CGST Act, taxpayers are prohibited from filing GSTR-1 more than three years after its original due date.

Who Should File GSTR-1?

Every registered GST taxpayer must file GSTR-1, even if no sales have taken place during the reporting period. In such cases, a Nil GSTR-1 can be filed, and since July 2020, this can also be done easily via SMS.

However, certain taxpayers are exempt from filing GSTR-1, as outlined below:

• Input Service Distributors (ISD)
• Composition Scheme Dealers
• Suppliers of OIDAR services (Online Information and Database Access or Retrieval), who are liable to pay tax under Section 14 of the IGST Act
• Non-resident taxable persons
• Taxpayers are bound to collect TCS (Tax Collected at Source).
• Taxpayers must deduct TDS (Tax Deducted at Source).

Only the registered taxpayers who do not fall into the above categories need to file this return regularly.

How to Revise GSTR-1?

Under the GST regime, once GSTR-1 is filed, it cannot be revised. That means if you make a mistake while filing, there is no direct option to edit or change the return after submission.

However, according to a CGST notification dated 10th July 2024, any error in GSTR-1 can be corrected through GSTR-1A for the same tax period (monthly or quarterly), as long as the correction is done before filing GSTR-3B for that same period.

So, if you notice any errors, make sure to fix them in time using GSTR-1A, before you submit GSTR-3B for that particular month or quarter.

GSTR-1 Late Fees and Penalty

If you miss the due date for filing GSTR-1, it will result in a late fee charge. The amount depends on whether your return includes transactions or is a nil return, and also on your annual turnover from the previous financial year.

1. 1. Late Fees for Returns with Transactions (Non-Nil GSTR-1)

1. 2. Late Fees for Nil GSTR-1 Filing

If you don’t have any outward supplies (sales) to report, you can file Nil GSTR-1. In such cases, the applicable late fee is significantly lower.

1. 3. Important Update

Earlier, the late fee was Rs 100 per day (Rs 50 under CGST and Rs 50 under SGST) for regular returns, and Rs 50 per day for Nil returns. But to ease the burden on taxpayers, the Central Board of Indirect Taxes and Customs (CBIC) reduced the late fees. This change was officially notified through Notification No. 20/2021 dated 1st June 2021, which also introduced a cap on the maximum late fee based on turnover.

GSTR-1 and GSTR-3B Reconciliation

GSTR-1 and GSTR-3B Reconciliation is a crucial process for businesses to ensure that the information reported in both returns aligns, which prevents errors in GST liability and Input Tax Credit (ITC) claims.

• Importance: This ensures accurate GST liability, avoids ITC mismatches, and prevents penalties. Correct reconciliation helps in smooth GST audits.
• How to Reconcile

To reconcile GSTR-1 and GSTR-3B, businesses should first compare the outward supplies and the GST paid as reported in both returns. This ensures that the sales and tax amounts are consistent.

It is essential to verify the Input Tax Credit (ITC) claimed in GSTR-3B by cross-checking it with the ITC details in GSTR-2A or GSTR-2B, which reflect the data from suppliers' GSTR-1 filings.

Businesses must ensure that any amendments to sales made in GSTR-1 are accurately reflected in both returns to maintain consistency and avoid discrepancies.

There are some steps you need to follow to reconcile GSTR-1 and GSTR-3B, those are mentioned below:

1. Download Both Returns: Begin the process with the download of the GSTR-1 and GSTR-3b returns for the relevant period from the GST portal.
2. Cross-Check Sales, Tax Paid, and ITC: Compare the sales figures, GST paid, and ITC claims in both returns. Make sure the details in GSTR-1 align with GSTR-3B and cross-check ITC claims with GSTR-2A/2B.
3. Correct Discrepancies: If any mismatches are found, amend the details in GSTR-1 and make adjustments to GSTR-3B as needed before you finalize it.
4. File on Time: Ensure both returns are filed within the due date to avoid penalties or interest for late submission.

This process helps ensure accurate and compliant GST filings.

Correction of Data in GSTR-1A

GSTR-1A is used to correct errors in GSTR-1, but it can only be done before filing GSTR-3B for the same period. Here is how businesses can use it:

• What Mistakes Can Be Corrected?

1. Incorrect Sales or Taxable Value: Fix errors in sales figures or taxable value.
2. Missing Invoices: Add any invoices or transactions not included in GSTR-1.
3. GST Paid Errors: Correct mistakes in the GST amount (CGST/SGST/IGST).
4. Debit/Credit Note Errors: Amend any mistakes in reported debit or credit notes.

• How to Make Corrections:

1. Identify Errors: Review GSTR-1 for mistakes like missing invoices or incorrect amounts.
2. Generate GSTR-1A: Log in to the GST portal, choose GSTR-1A, and apply the required modifications.
3. Submit GSTR-1A: After you correct the data, submit GSTR-1A. The changes will be reflected in the next GSTR-1 filing.

• Important Notes:

1. Corrections must be made before filing GSTR-3B.
2. No revisions are allowed once GSTR-3B is filed.

You have to use GSTR-1A to help ensure that errors in sales, GST paid, or missing invoices are corrected before finalizing GSTR-3B.

Penalty for Non-Compliance and Prosecution

In addition to late fees, the GST law also includes stricter penalties for businesses that intentionally do not comply with return filing rules or repeatedly fail to file GSTR-1.

Key Penalties and Legal Actions:

1. General Penalty for Non-Compliance:
   As per Section 125 of the CGST Act, if a registered person fails to comply with any GST rules (like not filing GSTR-1), a general penalty of up to Rs 25,000 may be imposed. This is separate from the late fees.
2. Penalty for Willful Tax Evasion
   If a business deliberately hides outward supplies or manipulates invoices to evade tax, it can face a penalty of 100% of the tax due, as per Section 122 of the CGST Act.
3. Prosecution for Fraudulent Filing
   In cases of fraud or intentional tax evasion, the offender may face prosecution, which includes jail time. This punishment depends on the amount of tax avoided:

• Tax evasion over Rs 5 crore can lead to jail up to 5 years.
• Rs.2 crore to Rs.5 crore may lead you to jail for up to 3 years.
• Rs.1 crore to Rs.2 crore can lead to jail up to 1 year.

4. Restriction on Filing Other Returns
   If GSTR-1 is not filed, businesses may be barred from filing GSTR-3B, which affects their ability to claim Input Tax Credit (ITC) and maintain compliance.

Why It Matters:

Timely and accurate filing of GSTR-1 isn’t just a formality, it is a legal responsibility. This continuous failure or willful default can attract heavy penalties and even legal action from the GST department.

If you stay compliant, it not only avoids legal trouble but also helps maintain a trustworthy business.

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Role of GSTR-1 in GST Audits

GSTR-1 plays an important role during GST audits conducted by tax authorities. It contains detailed information about a business’s outward supplies/sales and is one of the key documents reviewed during an audit.

Why GSTR-1 is Important in Audits:

1. Cross-Verification of Sales

Auditors compare the sales details reported in GSTR-1 with other records like GSTR-3B, purchase register, and financial statements. Any mismatch may lead to questions or further scrutiny.

2. Validation of Tax Payments

Tax officials use GSTR-1 to confirm if the correct amount of the GST has been collected and paid. Errors in reporting sales or tax can lead to notices or penalties.

3. Input Tax Credit (ITC) Check for Buyers
   The data you file in GSTR-1 is also visible to your buyers in their GSTR-2A/2B. If your details are wrong or missing, your buyers may face issues in claiming ITC, which can trigger complaints or audits.
4. Impact on Audit Risk
   Accurate and timely GSTR-1 filing shows that the business is compliant, which can reduce the chances of being selected for a detailed audit.

In short, GSTR-1 is not just a compliance form, it is a key tool for audit assessment. Proper filing helps avoid legal issues and builds trust with both tax authorities and clients.

GSTR-1 for E-commerce Operators

E-commerce operators have specific responsibilities under the GST system, especially when it comes to filing GSTR-1. If they collect Tax Collected at Source (TCS) under Section 52 of the CGST Act or facilitate sales under Section 9(5), they must report these details carefully in the return.

Key Challenges and Requirements:

1. Reporting Sales of Sellers
   E-commerce platforms must report the sales made by each seller through their platform. This includes both B2C (Business to Customer) and B2B (Business to Business) transactions.
2. TCS Collection and Reporting
   When e-commerce operators collect TCS at 1%, they must report this in Table 14 of GSTR-1. It includes:
   • Seller’s GSTIN
   • Gross value of supplies
   • Tax collected
3. Sales Under Section 9(5)
   For certain services like cab booking, housekeeping, and restaurant services (as notified), the e-commerce operator is responsible for paying GST, not the supplier. These must be reported accurately in GSTR-1.
4. Amendments in Tables 14A and 15A
   If there are any changes required in the previously reported data, operators must use Table 14A and Table 15A for amendments.
5. Reconciliation with GSTR-8
   Operators also file GSTR-8 to report TCS details. It is important to ensure the data in GSTR-1 matches with GSTR-8 to avoid mismatches and notices.

Challenges Faced by Businesses in GSTR-1 Filing:

Businesses often face different problems while filing GSTR-1.

• You may face any technical glitch on the GST portal like slow loading or system errors, especially near the due date.
• There are other challenges like entering any wrong details like any incorrect GSTINs, invoice numbers, or amounts. These mistakes can affect the filing and may lead to notice from the tax department.
• Sometimes the data filed in GSTR-1 doesn’t match the buyer’s return (GSTR-2A/2B), which can cause problems in claiming Input Tax Credit (ITC)
• These errors not only delay the process but can also result in penalties or financial loss for both the seller and the buyer.

Impact of Incorrect GSTR-1 Filing on ITC Claims:

• If you file incorrect details in GSTR-1 it can directly affect your customer’s ability to claim an Input Tax Credit (ITC).
• When you sell goods or services to another business, they can claim ITC based on the data you provide in your GSTR-1.
• If there are mistakes like wrong GSTIN, invoice number, taxable value, or tax amount, your customer won’t see the correct data in their GSTR-2A or GSTR-2B.
• This means they may not be able to claim ITC or their claim may be delayed or denied during assessment.
• Such errors not only create trust issues but can also lead to notices from the GST department.
• That is why it is very important to file GSTR-1 accurately and carefully, so your customers get their due credit without any hassle.

Conclusion

If you file GSTR-1 return accurately and on time is not just a compliance formality; it is essential to avoid penalties, maintain trust with customers, and ensure smooth GST audits. Mistakes or delays can lead to ITC issues, legal trouble, or loss of business credibility.

At Online Legal India, we simplify the entire GST process for you. Whether you are a small business or a growing enterprise, our experts ensure accurate and timely GSTR-1 return filing and GST registration support. We assist you throughout this process. We help you stay fully compliant without the hassle. Visit Online Legal India today.