Recent GST updates, effective from late 2025, introduce significant compliance changes for taxpayers. A new circular, dated October 1, 2025, has simplified the process for post-sales discounts, allowing suppliers to pass discounts through a GST Credit Note without the earlier requirements of pre-signed agreements or invoice-wise linkage; the recipient simply reverses the proportionate Input Tax Credit (ITC). Furthermore, effective from the September 2025 tax period, TDS reporting in Form GSTR-7 is now mandatory on an invoice-wise basis, replacing consolidated reporting to enhance auto-matching and reconciliation of credits. The government has also imposed a strict three-year limitation period for filing all GST returns (GSTR-1, 3B, 9/9C, etc.) from their original due date, effective from the October 2025 tax period. For example, returns for September 2022 and FY 2020–21 will be barred after November 1, 2025. Finally, an advisory from the GST Appellate Tribunal (GSTAT) dated September 25, 2025, mandates that all appeals under Sections 107 and 108 of the CGST Act must now be filed electronically on the GSTAT portal in a phased manner, with a final cut-off date of June 30, 2026, to ensure a smoother, digital appeal process. These changes collectively aim to promote a more transparent, digital, and timely compliant tax environment.
Arjuna (Fictional Character): Krishna! Every few months new GST circulars and notifications come out, and it becomes difficult for businessmen to keep track. So, what are the important GST changes which came in recent times that we should know?
Krishna (Fictional Character): Arjuna! You are right. GST keeps evolving and keeping yourself updated with these evolving changes is the best way to stay compliant with laws and avoid penalties. Recently, a few important developments have been announced covering post-sales discounts, GST Appellate Tribunal appeals, invoice-wise reporting in GSTR-7 and pending return filings. Let’s understand each one carefully.
Arjuna (Fictional Character): Krishna, there was always confusion about post sales discount. What has changed now?
Krishna (Fictional Character): Arjuna! The GST Council has simplified the entire process. Earlier, post-sales discounts requires pre-signed agreements or invoice-wise linkage to claim adjustments which cause unnecessary paperwork and disputes.
Now, as per the circular dated 1st October 2025, post-sales discounts can simply be passed through a GST Credit Note. The supplier issues the credit note for the discount value and recipient reverse the proportionate ITC on that amount and there is no such requirement for invoice wise linking of Credit note and pre signed agreements.
Arjuna (Fictional Character): Krishna, There are some changes about TDS under GST with effect from September 2025. So, what are such changes?
Krishna (Fictional Character): Arjuna! Yes, there is a very important update in GST regarding TDS. GSTN has now enabled invoice wise reporting of TDS in the Form GSTR-7. With Effective from the September 2025 tax period, every TDS deductor must report Invoice number, date, Taxable value, GST amount and TDS amount deducted of each invoice while filing monthly GSTR-7 return. Earlier, consolidated reporting was allowed, but now it’s mandatory to provide invoice-wise entry. This will help in auto-matching and reconciliation of TDS credits between the deductor and supplier.
Arjuna (Fictional Character): Krishna, many small businesses still have old pending returns. What has the department said about that?
Krishna (Fictional Character): Arjuna, The taxpayers will no longer be allowed to file GST returns after three years from their original due date. This restriction applies to returns under Sections 37, 39, 44, and 52, covering GSTR-1, IFF (for QRMP Scheme), GSTR-3B, GSTR-4, GSTR-5, GSTR-6, GSTR-7, GSTR-8, and GSTR-9/9C. The provision will take effect from the October 2025 tax period after which any return pending for more than three years will be permanently barred from filing. For example, GSTR-1 and GSTR-3B for September 2022 and GSTR-9/9C for FY 2020–21 will not be allowed to be filed after 1st November 2025.
Arjuna (Fictional Character): Krishna, what about the advisory issued on Filing of Appeals before GST Appellate Tribunal (GSTAT).
Krishna (Fictional Character): Arjuna, GSTAT issued an advisory dated on 25th September 2025 that all appeals under Sections 107 and 108 of the CGST Act will now have to be filed electronically on the GSTAT portal. The filing process will take place in staggered phases, depending on when the earlier appeal or revisional order was filed. To avoid system overload, taxpayers will need to follow the phase-wise filing windows as notified, but in all cases, the final cut-off date for filing appeals is 30th June 2026. This change ensures a smoother transition to electronic filing, avoids portal congestion.
Arjuna (Fictional Character): Krishna, what should we learn from this?
Krishna (Fictional Character): Arjuna, taxpayer, should understand that the government is making the GST system simpler, more transparent and more digital. Businesses can now easily give post-sale discounts through credit notes without extra paperwork. Those deducting TDS under GST must now report each invoice separately, ensuring transparency and reducing the chances of mismatch. Old GST returns cannot be filed after three years, so everyone must file their returns on time. Also, appeals can now be filed online through the GST Appellate Tribunal portal, making the process faster and easier. These changes aim to make GST compliance smoother for everyone and encourage timely and honest tax practices.
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