The GST Annual Return (GSTR-9) and the Reconciliation Statement (GSTR-9C) serve as the final handshake between a taxpayer’s internal records and their monthly filings. For the Financial Year 2024-25, the government has introduced significant amendments aimed at eliminating ambiguity, improving reconciliation accuracy, and tightening the audit trail—especially concerning Input Tax Credit (ITC).
Here is a simplified breakdown of the key compliance changes you must be aware of before the December 31, 2025, filing deadline.
1.Applicability: Who Must File?
The government has provided clarity and relief for smaller businesses, but compliance remains strict for others.
GSTR-9 (Annual Return):
Mandatory for all regular taxpayers with an Aggregate Turnover exceeding ₹2 Crore. Taxpayers below this threshold are generally exempted, continuing the long-standing relief.GSTR-9C (Reconciliation Statement):
Mandatory for taxpayers with an Aggregate Turnover exceeding ₹5 Crore. This form must be self-certified by the taxpayer (CA certification is no longer required, but the rigor of reconciliation is higher).
2. The Major ITC Overhaul (Table 6)
The most notable changes are found in the Input Tax Credit (ITC) section, forcing granular reporting of cross-year adjustments.
A. The New Segregation (Table 6A1)
- The Change: A new field, Table 6A1, has been introduced.
- What to Report: This table mandates the disclosure of ITC pertaining to the Previous Financial Year (FY 2023-24) but which was actually claimed in the returns of the Current Financial Year (FY 2024-25) (up to the filing deadline of November 30, 2025).
- Why it Matters: This new table separates the Spill-Over ITC from the true current-year ITC. This resolves a common reconciliation issue and makes the net ITC (Table 6A2) a cleaner figure for the current year.
B. Clarity on Reversals and Reclaims (Table 6H & 7)
- The process of reporting ITC that was reversed and subsequently reclaimed has been streamlined:
- ITC Reclaim (General): If you reclaimed ITC (other than Rule 37/37A reversals) that pertains to the current FY, you must report the reclaim in Table 6H.
- Rule-based Reversals (Table 7): ITC reversed due to specific compliance rules (like Rule 37 for non-payment to suppliers within 180 days or Rule 37A for vendor non-filing) must now be reported in separate, distinct lines in Table 7. This provides the department with clear audit trails for compliance checks.
3. Revised Auto-Population Logic
The core data source for ITC reconciliation has been refined to align better with system data.
- Shift to GSTR-2B: Table 8A (System-computed ITC) continues to auto-populate, but its logic now strictly follows GSTR-2B data (not GSTR-2A).
- Strict FY Inclusion: Table 8A will now exclude any invoices pertaining to the prior financial year (FY 2023-24) that were uploaded by vendors in the current FY (April 2024 to November 2024). It focuses almost exclusively on invoices dated FY 2024-25.
- Impact: This change requires taxpayers to perform a deeper, book-level reconciliation to track ITC carry-forwards, as the auto-populated 8A will be less forgiving of cross-year mismatches.
4. Tax Liability and Payment Alignment
The reconciliation of tax liability has been given more emphasis.
- Mandatory Disclosure of Variance: Table 9 now requires an upfront reporting of the difference between the Tax Payable (as per GSTR-9) and the Tax Paid (as per GSTR-3B).
- Rectification Required: Any additional liability identified during the Annual Return filing must be paid immediately through Form DRC-03, as the GSTR-9 form itself cannot be used for tax payment (only for late fees).
Conclusion:
The recent focus across GST, Income Tax, and Tax Audit is clearly on digital transparency, enhanced reconciliation, and simplifying compliance for small taxpayers while tightening the screws on high-value and cross-year transactions.