Common GST Mistakes That Could Cost Your Business
GST may have simplified the Indian taxation system, but non-compliance or small errors can lead to hefty penalties and even disruption of business operations. Many businesses—especially small and medium enterprises (SMEs)—unknowingly make mistakes that affect their financial health.
Here are 5 common GST mistakes you should avoid:
1. Delayed GST Return Filing
Missing return deadlines leads to interest, late fees, and could restrict your ability to claim Input Tax Credit (ITC). Delays may also trigger government notices and system-based suspension of GSTIN.
2. Incorrect ITC Claims
Claiming ineligible ITC is one of the most common errors. Only ITC backed by valid invoices, timely payments, and proper matching with GSTR-2B can be claimed.
3. Mismatch in GSTR-1 and GSTR-3B
Discrepancies between outward supply details in GSTR-1 and the summary in GSTR-3B often lead to audits or notices. Reconciliation is key to compliance.
4. Not Updating Business Details
Change in address, contact info, or business type must be updated in the GST portal. Failing to do this can create problems during scrutiny or inspections.
5. Poor Record-Keeping
Businesses are required to maintain books, invoices, and digital records for several years. Poor documentation may result in ITC disallowance or penalties during audits.
