Every year, before the GST annual return is filed, your books of accounts, your GSTR-1 and your GSTR-3B have to agree with each other. Differences that nobody can explain are one of the most common reasons for GST notices. This guide covers who has to file GSTR-9 and GSTR-9C, the due date and late fees, and a simple step-by-step way to reconcile your numbers.
Who files GSTR-9 and GSTR-9C
- GSTR-9 is the annual return of a regular GST taxpayer. It sums up the year's sales, purchases, tax paid and input tax credit (ITC). Businesses with an aggregate turnover of up to ₹2 crore are exempt from filing it from FY 2024-25 onwards (Notification No. 15/2025-Central Tax, 17 September 2025). Composition taxpayers file GSTR-4 instead.
- GSTR-9C is a reconciliation statement between your audited financial statements and GSTR-9. It applies when aggregate turnover is above ₹5 crore. Since FY 2020-21 it is self-certified by the taxpayer; certification by a CA or cost accountant is no longer required.
- The due date for both is 31 December after the end of the financial year, unless the government extends it. For FY 2025-26, that is 31 December 2026.
Step 1: Match your sales (GSTR-1) with your books
- Take the taxable turnover for the year from your books and compare it with the total of your monthly or quarterly GSTR-1 returns.
- Account for credit notes and debit notes issued during the year, and for corrections made later through GSTR-1 amendments or GSTR-1A.
- Look for the usual reasons for a difference: sales booked in the books but not reported, advances, year-end entries such as unbilled revenue, and this year's bills reported in next year's returns.
- In GSTR-9, report B2B, B2C, export, exempt and nil-rated supplies in their own tables, mapping each sales ledger to the right table.
Step 2: Match your ITC (GSTR-3B) with your books and GSTR-2B
- Compare the ITC claimed in your GSTR-3B returns with the purchase register in your books.
- Check every claim against GSTR-2B. Since January 2022, ITC is allowed only on invoices that appear in your GSTR-2B (Section 16(2)(aa) of the CGST Act).
- Reverse ITC on bills you have not paid within 180 days of the invoice date. You can claim it again once you pay the supplier.
- Check the other reversals too: ITC on goods for personal use or exempt supplies, and on goods lost, written off or destroyed.
A simple reconciliation example
- Taxable sales as per your books: ₹50,00,000.
- Taxable value in your GSTR-1 returns for the year: ₹49,50,000. Difference: ₹50,000.
- You find bills worth ₹50,000 dated 30 March that were reported in the April GSTR-1. They belong to this year, so show them in GSTR-9 in the table for this year's supplies declared in the next year's returns (Table 10). Books and returns now agree.
- ITC claimed in GSTR-3B: ₹4,00,000. ITC in GSTR-2B: ₹3,85,000. The extra ₹15,000 comes from two bills your supplier never uploaded. Ask the supplier to report them, and reverse the ₹15,000 until they appear in your GSTR-2B.
For differences you cannot explain, involve your CA before you file.
Common mistakes that lead to notices
- Tax on sales in GSTR-1 higher than tax paid in GSTR-3B, with no explanation for the gap.
- ITC claimed on invoices that are not in GSTR-2B, or not reversed on bills unpaid after 180 days.
- Credit notes for the year declared after the 30 November deadline, which can no longer reduce your tax.
- Turnover in GSTR-9 that does not match your audited accounts or your income tax return, without a reconciliation.
Late fees for GSTR-9
If GSTR-9 is filed late, a late fee applies for each day of delay. From FY 2022-23 onwards the fee (CGST and SGST together) is:
| Aggregate turnover in the year | Late fee per day | Maximum |
|---|---|---|
| Up to ₹5 crore | ₹50 | 0.04% of turnover |
| ₹5 crore to ₹20 crore | ₹100 | 0.04% of turnover |
| Above ₹20 crore | ₹200 | 0.5% of turnover |
Unexplained differences cost more than the late fee: they lead to notices and demands for tax, interest and penalty, so file only after the numbers agree.
Make the annual return a routine
If you reconcile your sales and ITC every month, the annual return becomes a formality instead of a December rush. ValueSoft GST software makes GSTR-1 and GSTR-3B ready reports straight from your bills and reconciles your purchases with GSTR-2A and GSTR-2B for several months at a time, so mismatches show up early. Book a free demo on kalasoftech.com to see it with your own data.
Frequently asked questions
Is GSTR-9 compulsory for small businesses?
Businesses with an aggregate turnover of up to ₹2 crore are exempt from filing GSTR-9 from FY 2024-25 onwards (Notification No. 15/2025-Central Tax). Regular taxpayers above ₹2 crore must file it by 31 December after the year ends.
Does GSTR-9C need a CA's certification?
No. Since FY 2020-21, GSTR-9C is self-certified by the taxpayer. It has to be filed when aggregate turnover is above ₹5 crore.
What is the late fee for filing GSTR-9 late?
From FY 2022-23 onwards: ₹50 per day for turnover up to ₹5 crore, ₹100 per day for ₹5 crore to ₹20 crore, and ₹200 per day above ₹20 crore (CGST and SGST together). The total is capped at 0.04%, 0.04% and 0.5% of turnover respectively.
What if my GSTR-2B shows less ITC than I claimed?
Input tax credit is allowed only on invoices that appear in your GSTR-2B. Ask the supplier to upload the missing bills; until they appear, reverse the extra ITC, with interest if it was used to pay tax.
When should I do the reconciliation?
Ideally every month, when you file GSTR-1 and GSTR-3B. Then the annual return only adds up numbers you have already checked, instead of a rush in December.
Sources
This article is for general information. GST rules change from time to time: check the GST portal or ask your CA before acting on it.
