March 2025 is crucial for GST compliance, requiring businesses to complete 16 key actions. These include reconciling outward supplies in Forms GSTR-1 and GSTR-3B, aligning input tax credit (ITC) and cash balances with GST portal records, and reconciling revenue between books and GST returns. Exporters should file for the Letter of Undertaking (LUT) for FY 2025-26 before March 31, 2025. Businesses must ensure ITC accuracy by matching GSTR-2B with books and following up with vendors for any discrepancies. Additionally, ITC reversal or reclaim should align with Rule 42/43, and reverse charge mechanism (RCM) liabilities must be discharged promptly. Payments to suppliers should be analyzed, especially for compliance with MSME guidelines and Section 16(2) of the CGST Act. Other key tasks include opting for the composition scheme (CMP-02), checking e-invoicing applicability for entities with turnover above ₹5 crore, and assessing the need for Input Service Distributor (ISD) registration. Businesses should also implement a new document series, consider the QRMP scheme for FY 2025-26, and utilize the GST Amnesty Scheme for past due payments. Proper treatment of credit notes and compliance with statutory deadlines are essential to avoid penalties and ensure a smooth transition into the new financial year.
Page Contents
- 16 Important Actions to be taken March 2025 – GST perspective
- 1. Reconciliation of outward supplies reported in Form GSTR 1 and GSTR 3B:
- 2. Reconciliation of ITC/Cash balance as per books of accounts and GST portal:
- 3. Revenue Reconciliation:
- 4. Apply Letter of Undertaking (LUT)– if you are an Exporter/Supplier to SEZ unit/authority
- 5. Reconcile the input tax credit register with GSTR 2B:
- 6. Reversal/Reclaim of input tax credit as per Rule 42 /43:
- 7. Discharge the RCM liability and claim the corresponding ITC for the FY 2024-25:
- 8. Non-payment of consideration by recipient within 180 days from the date of invoice:
- 9. Opt-in for Composition scheme by filing CMP-02 on or before 31st March 2025
- 10. Payment to Suppliers having UDYAM registered as Micro and Small Entities (Not GST related but VERY IMPORTANT)
- 11. Check if E-invoicing is Mandatory for your entity w.e.f. 01 April 2025
- 12. Assess the requirement to obtain ISD registration (if you have GSTIN in more than 1 State)
- 13. Introduce new document series from 01 April 2025
- 14. Opt In for QRMP scheme
- 15. GST Amnesty Scheme (Section 128A)
- 16. Treatment of Credit notes – Inward and Outward
16 Important Actions to be taken March 2025 – GST perspective
1. Reconciliation of outward supplies reported in Form GSTR 1 and GSTR 3B:
As a result of reconciliation between GSTR-1 and GSTR-3B, if any amendment to be executed in any of the outward invoices which have been already reported in GSTR-1 of FY 2024-25, such amendment should be reported in GSTR-1 of March 2025.
In this regard, we suggest sending an e-mail to the clients requesting them to check and inform regarding any amendment required in relation to the invoices/credit notes issued during the year.
2. Reconciliation of ITC/Cash balance as per books of accounts and GST portal:
The amount of input tax credit and Cash balance as per books of accounts should be reconciled with electronic cash ledger and electronic credit ledger as per GST portal.
Ideally the balances should be matched with no difference/reconciling items. Necessary corrections may be taken up in the books of accounts or GST return for the month of March 2025.
3. Revenue Reconciliation:
Revenue as per the books of accounts should be reconciled with the turnover reported in GST returns filed by the entity during the year.
Any difference should be addressed with correction in GST returns or books of accounts. A reconciliation file should be prepared to avoid any surprise during the course of statutory audit or GST annual return filing.
Incase you are an exporter or supplier of good/services to SEZ unit/authority and opt for supplying the goods/services without payment of IGST under the provisions of Section 16 of IGST Act, then you should file an application for obtaining LUT on GST portal.
It is advisable to opt for LUT which shall be filed before 31 March 2025 for the FY 2025-26 on GST portal.
5. Reconcile the input tax credit register with GSTR 2B:
The amount of ITC reported in GSTR 3B and booked in books of accounts of shall be reconciled with the auto populated input tax credit.
– If the input tax credit in GSTR 2B is more than GSTR 3B, then it reflects the position where expenses are incurred by the Entity but not yet booked in the books of accounts. It is important for closure of books in efficient manner.
– Where the ITC is claimed in GSTR 3B or the invoices are booked in the books of accounts but the ITC is not appearing in GSTR 2B, then it is advisable to follow up with the vendors for correct reporting of invoices in their GSTR 1 so that the ITC can be appeared in GSTR 2B.
6. Reversal/Reclaim of input tax credit as per Rule 42 /43:
A registered person, supplying goods or services which are exempt under GST provisions, shall be required to reverse the input tax credit as per the provisions of S. 17 of CGST Act read with Rule 42/43.
The ITC reversal/reclaim on account of above should be reported in GSTR 3B of March 2025 appropriately. If such reversal is reported in subsequent month, then the interest shall be levied under the provisions of S. 50 of CGST Act.
7. Discharge the RCM liability and claim the corresponding ITC for the FY 2024-25:
We suggest to analyze the expenses incurred during the year and wherever it is applicable, the RCM liability should be reported in GSTR 3B and the eligible ITC should be claimed in GSTR 3B for the month of March 2025, if missed earlier.
Please be informed that the time of supply incase of inward supplies subject to RCM, shall be 60 days from the date of invoice or date of payment, whichever is earlier. However, incase of related persons, the date of amount credited or date of payment, whichever is earlier, shall be the time of supply.
8. Non-payment of consideration by recipient within 180 days from the date of invoice:
According to proviso of Section 16(2), the recipient of goods or services is required to make payment to supplier within 180 days from the date of issue of invoice.
If any ITC is claimed on invoice which is outstanding for more than 180 days, then the ITC should be reversed in GSTR 3B and the same shall be re-claimed on payment to the supplier.
Kindly analyze the creditors ageing and take appropriate actions.
9. Opt-in for Composition scheme by filing CMP-02 on or before 31st March 2025
If you are a regular taxpayer and eligible to opt for composition scheme, then you may file an intimation under Form CMP-02 on or before 31 March 2025 to opt for composition scheme for the next financial year.
Categorize your creditors into MSME (Micro and Small) and Non-MSME.
Prepare an ageing of creditors and identify the invoices which are outstanding for Micro and Small entities with UDYAM registration.
Locate the invoices which are outstanding beyond the due date of payment and the due date is on or before 31 March 2025, make the payment for such invoices before 31 March 2025,
Locate the invoices which are outstanding after 31 March 2025 but booked in FY 2024-25, then make sure the payment is done before such due date or before 31 March 2025.
11. Check if E-invoicing is Mandatory for your entity w.e.f. 01 April 2025
As per rule 48(4) of the CGST Rules, any registered person having aggregate turnover more than INR 5 Crore in any preceding financial year shall be required to comply with e-invoicing provisions.
Check if your aggregate turnover in any preceding financial year including FY 2024-25, is exceeding INR 5 Crore. If yes, then you should comply with E-invoicing norms.
12. Assess the requirement to obtain ISD registration (if you have GSTIN in more than 1 State)
i. Mandatory registration as ISD w.e.f. 01 April 2025.
ii. Re-assess the expenses and analyse if it is required to implement ISD.
iii. Identify the State where the registration of ISD shall be applied.
1. Reach out to registered vendors supplying common input services, to raise invoices on ISD.
2. Implement fresh SOPs and educate finance team to ensure the compliance of Section 20 of CGST Act i.e. CLAIM and DISTRIBUTE the ITC through ISD and have appropriate documentation in place.
3. Training of the finance and accounts team is also one of the important check point for smooth implementation of ISD.
13. Introduce new document series from 01 April 2025
As per the provision of Section 31 read with Rule 48 of the CGST Rules, the registered person should follow unique document series during a financial year.
This will be applicable on tax invoice, credit note, bill of supply, debit note, delivery challan or any other GST document.
14. Opt In for QRMP scheme
A taxable person having aggregate turnover of more than INR 5 Crore have an option to prepare and file Form GSTR 1 and GSTR 3B on Quarterly basis.
This option may be opted before 30 April 2025 for the FY 2025-26
15. GST Amnesty Scheme (Section 128A)
Section 128A allows taxpayers who have received notices u/s 73 of the CGST Act for FY 2017-18, 2018-19, and 2019-20 to apply for a waiver of interest and penalty.
To qualify, taxpayers must fully pay outstanding tax dues by March 31, 2025.
16. Treatment of Credit notes – Inward and Outward
Credit notes on Inward Supplies – It is important to analyze the GSTR 2B for the period April 2024 to March 2025 and check if all the credit notes raised by suppliers are well taken into account in the books of accounts or communicated to the supplier.
Credit notes on Outward Supplies – Check if the credit notes reported from October 2024 onwards are accepted by the Clients and ITC has been reversed by them for smooth claim of reduction of GST liability.
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