What to Do/Compulsory Compliance Immediately After GST Registration in India

What to do / compulsory compliance immediately after (within 1, 2 or 3 months) of gst registration


Getting GST registration is an important step for businesses in India, but it’s just the beginning of your responsibilities under the Goods and Services Tax (GST) regime. After registering for GST, businesses are required to comply with several important rules and regulations. Ensuring compliance immediately after registration will help you avoid penalties and smoothen your business operations under the new tax regime.

In this blog post, we’ll guide you through the compulsory compliance requirements that you need to take care of within the first 1 to 3 months of GST registration.

1. Update Your Invoices with GST Details

One of the first things you need to do after obtaining your GST registration is to update your invoices. All invoices you issue for your goods or services must include specific details, including your GSTIN (GST Identification Number).

What You Need to Do:

  • Ensure that all invoices issued after registration include your GSTIN.
  • The invoice should clearly mention the applicable GST rate, either CGST (Central GST), SGST (State GST), or IGST (Integrated GST), depending on whether the transaction is within the state or interstate.
  • If you’re selling to a GST-registered customer, the invoice must also include the GSTIN of the buyer.

This is critical because improper invoices could lead to the disallowance of Input Tax Credit (ITC) for your customers and penalties for your business.

2. File Your First GST Return (GSTR-3B)

Within the first month of GST registration, you are required to file GSTR-3B, which is a summary return that includes details of sales, purchases, and tax liabilities. Filing this return is mandatory even if your business has no transactions in a given period.

What You Need to Do:

  • GSTR-3B is to be filed monthly, and it must be done by the 20th of the following month. For example, if you registered in January, your first return will be due by the 20th of February.
  • In GSTR-3B, you need to provide the following details:
    • Outward supplies (sales) and inward supplies (purchases)
    • Total tax liability (CGST, SGST, or IGST)
    • Input tax credit (ITC) you’ve claimed
  • If you fail to file on time, penalties or interest may be levied.

Even if your business has no transactions, you are still required to file a nil return.

3. Update Your Accounting and ERP Systems

After GST registration, it’s crucial that your business’s accounting system or Enterprise Resource Planning (ERP) system is updated to comply with GST regulations. Your accounting software should support GST invoicing, tax calculations, and filing of returns.

What You Need to Do:

  • Ensure that your accounting system is aligned with GST norms, allowing you to track and categorize transactions properly for GST filing.
  • Set up your system to calculate the appropriate GST rates (CGST, SGST, or IGST) on your sales and purchases.
  • Record every transaction that involves GST separately, making it easy to generate accurate returns at the end of each tax period.

This will help avoid errors when filing your returns and reduce the risk of non-compliance.

4. Maintain GST-Compliant Records

After GST registration, maintaining proper records is essential. GST law mandates that businesses maintain a variety of documents related to purchases, sales, and tax payments for a minimum of 6 years.

What You Need to Do:

  • Keep records of all invoices, bills of supply, and other GST-related documents.
  • Record details of input tax credit (ITC) claimed and any adjustments made to previous GST returns.
  • Maintain bank statements, cash receipts, and payment vouchers to support your returns.
  • If your business has more than one location or branch, maintain separate records for each.

Proper record-keeping will ensure that you are prepared for future audits, inspections, or inquiries from tax authorities.

5. Obtain and Display GST Registration Certificate

After GST registration, you will receive a GST registration certificate. This certificate must be displayed at your business premises for easy access and visibility.

What You Need to Do:

  • Obtain a hard or soft copy of the GST certificate from the GST portal after registration.
  • Display the certificate prominently at your business location, especially if you have a physical store or office. It reassures your customers and clients that your business is GST-compliant.
  • Also, ensure that your GSTIN is displayed on your invoices, websites, and any marketing materials, as this boosts trust among your customers and suppliers.

6. Register for GST Payment (if Required)

If your business deals with interstate sales or your turnover exceeds the threshold limits, you must ensure you are registered to pay GST. This means you will need to regularly remit GST on both your sales (output tax) and your purchases (input tax credit).

What You Need to Do:

  • Remit the tax you collect from customers on time to the government (either monthly or quarterly depending on your tax filing).
  • Ensure you pay any pending GST amounts as per the tax period for which your returns are due.

Late payments may incur interest or penalties, so timely remittance is crucial.

7. Verify Your Supplier’s GST Registration

Once your GST registration is complete, you’ll need to verify the GST registration details of your suppliers to ensure that they are compliant. This is especially important when claiming input tax credit (ITC) on purchases.

What You Need to Do:

  • Verify that your suppliers are GST-registered and their GSTIN is valid. You can do this by checking their details on the GST portal.
  • Only claim input tax credit on purchases from suppliers who are registered under GST.
  • Ensure your purchase invoices are GST-compliant, with the correct GSTIN and details of the tax levied.

8. File GSTR-1 (Sales Return) and Other Monthly Returns

Along with GSTR-3B, businesses must also file GSTR-1 for their outward supplies (sales). GSTR-1 provides detailed information about sales and GST charged.

What You Need to Do:

  • File GSTR-1 by the 10th of the following month, which provides a detailed breakdown of all sales, including invoices issued and GST collected.
  • GSTR-1 is a more detailed return compared to GSTR-3B, and its timely filing is critical for maintaining compliance.

9. Set Up Tax Payment Mechanism

If you are required to pay GST, it’s important to set up a payment mechanism with the government.

What You Need to Do:

  • Ensure that you are registered for the GST Payment Gateway.
  • Set up your bank account for easy payment of taxes to the government through online modes.

This will help you make timely payments and avoid penalties.

10. Keep Track of Compliance Deadlines

GST compliance requires timely action, including return filing and tax payments. After registration, you need to track various deadlines for filing returns, paying taxes, and other regulatory requirements.

What You Need to Do:

  • Set up a system to keep track of the due dates for GST return filing (monthly/quarterly), tax payments, and any other regulatory deadlines.
  • Use reminder systems or calendar apps to stay on top of these deadlines to avoid penalties and late fees.

Conclusion

The first few months after GST registration are crucial for setting up your business’s compliance framework. From updating your invoices and filing your first GST returns to ensuring timely tax payments and record-keeping, staying on top of GST compliance is vital to avoiding penalties and ensuring your business operates smoothly under the GST regime.

By following the steps outlined above, you can ensure that your business remains compliant and avoids any pitfalls in the early stages of GST registration.

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