Filing your GST returns correctly is crucial for every business. A small mistake can lead to heavy penalties, notices from the GST department, or even loss of ITC (Input Tax Credit). At TaxUnplug, we want you to stay compliant and stress-free. Here’s a simple guide to the Top 10 Common GST Filing Errors and How to Fix Them. Let’s dive right in!
1. Mismatch of Sales Data Between GSTR-1 and GSTR-3B
Problem:
Many businesses report sales figures incorrectly in GSTR-1 compared to GSTR-3B, leading to discrepancies.
Fix:
Always reconcile sales data monthly before filing. Use automated accounting software or maintain clean Excel sheets to match figures. You can refer our blog on “A Practical Guide to GST Reconciliation for 2025” to understand that why GST Reconciliation is necessary and how to reconcile the data.
2. Incorrect Claim of Input Tax Credit (ITC)
Problem:
Claiming ITC without verifying whether the supplier has uploaded invoices can result in disallowance of credits.
Fix:
Before filing, match your GSTR-2A/2B report with your purchase records. Only claim ITC if it appears in GSTR-2A/2B. Claiming excess ITC can lead to scrutiny of your GST Returns.
3. Non-Payment of Tax on Reverse Charge Mechanism (RCM)
Problem:
Tax under RCM (like legal services, security services) is often forgotten, causing non-compliance.
Fix:
Maintain a separate record for RCM liabilities and pay them in cash through GSTR-3B. Then claim ITC in the next return.
4. Wrong GST Rates Applied
Problem:
Applying incorrect GST rates on products or services can lead to underpayment or overpayment.
Fix:
Always refer to the latest GST rate notifications on the GST portal or consult a tax expert before invoicing.
5. Delayed Filing of GST Returns
Problem:
Late filing results in late fees, penalties, and interest, hurting business cash flow.
Fix:
Set reminders or automate filing alerts. File NIL returns if there are no transactions to avoid penalties. If you did not file return for a long period, The GST department can cancel your GST registration.
6. Incorrect Classification of Goods and Services (HSN/SAC Codes)
Problem:
Using wrong HSN (for goods) or SAC (for services) codes can lead to mismatches and penalties.
Fix:
Double-check HSN/SAC codes from the official GST HSN Code list before filing returns.
7. Non-Reversal of ITC for Non-Payment to Vendors
Problem:
If payment to vendors is not made within 180 days, ITC claimed needs to be reversed.
Fix:
Regularly review your accounts payable and reverse ITC if payments are delayed beyond 180 days, as per GST rules.
8. Errors in Export/Import Reporting
Problem:
Incorrect reporting of export invoices or forgetting LUT (Letter of Undertaking) submission can block refunds.
Fix:
Ensure all export invoices are correctly reported with shipping bills, and LUT is filed timely every year.
9. Filing Wrong Type of Return
Problem:
Businesses sometimes file GSTR-1 quarterly when they should be filing monthly based on turnover.
Fix:
Check your aggregate turnover of the previous financial year and select the correct filing frequency accordingly.
10. Failure to Report Advances Received
Problem:
Advance payments received (especially for services) must be reported, but many businesses miss this.
Fix:
Maintain a register of advances separately and report them under the “Advance Received” section of GSTR-1.
Final Thoughts:
GST filing may seem complicated, but with the right practices, you can avoid costly errors.
Always reconcile your records, stay updated with the latest GST rules, and take expert help if needed.
At TaxUnplug, we specialize in making your GST filing process easy, accurate, and hassle-free.
- Stay compliant
- Maximize your ITC
- Avoid penalties
Need help with GST filing?
Top 10 Common GST Filing Errors
Contact TaxUnplug today and file your GST returns with complete confidence!