GST compliance has become more automated and analytics-driven since the introduction of GST 2.0 and the Invoice Management System (IMS). Even small mistakes can now lead to blocked ITC, penalties, or system-generated notices. This guide explains the most common GST errors taxpayers make in 2025 and how to avoid them.

1. Wrong GSTIN on Invoices
2. Incorrect GSTIN in B2B invoices can block ITC for recipients and create mismatches. This is especially critical in inter-branch or multi-state operations.
3. Missing Reverse Charge Mechanism (RCM) Liability
4. Many businesses forget to pay GST under RCM for legal services, GTA, sponsorship, import of services, or unregistered purchases. Missing RCM leads to interest, penalties and incorrect ITC reporting.
5. Delayed Filing of GSTR-1 and GSTR-3B
6. Late filing automatically triggers late fees, interest, and ITC restrictions. Even NIL returns must be filed on time to avoid compliance issues.
7. Incorrect HSN or SAC Classification
8. Wrong HSN or SAC codes may cause wrong GST rate selection. The department’s data analytics flags such discrepancies, resulting in scrutiny notices.
9. Mismatch Between GSTR-1 and GSTR-3B
10. Differences between outward supplies reported in GSTR-1 and tax paid in GSTR-3B lead to system-generated notices such as ASMT-10, DRC-01B and automated reconciliation alerts.
11. Ignoring GSTR-1A Amendments
12. Under the updated system, suppliers can amend or add details through GSTR-1A. If recipients do not verify or reconcile these changes, ITC mismatches may occur in GSTR-2B and annual returns.
13. Not Taking Action on IMS Dashboard
14. With IMS active, taxpayers must accept, reject or keep invoices pending. Ignoring IMS updates can lead to mismatches in GSTR-2B, affecting Table 8A of GSTR-9 and ITC eligibility.
15. Skipping Monthly or Quarterly Reconciliation
16. Post September 2025 GST updates, reconciliation has become mandatory for accurate ITC, vendor compliance tracking and mismatch-free reporting. Not reconciling GSTR-2B, GSTR-1, GSTR-3B and book records leads to blocked ITC or excess tax liability.
17. Not Reviewing Supplier Compliance
18. If suppliers delay filing GSTR-1 or upload wrong details, the recipient’s ITC gets affected because ITC now depends heavily on supplier-side compliance and portal matching.
19. Manual Data Entry Without Automation
20. Businesses relying only on manual entries make errors in outward supplies, ITC claims, and return filing. GST automation tools significantly reduce mismatches and improve accuracy.

Pro Tip

Reconcile your books with GSTR-1, GSTR-3B and GSTR-2B every month. Use IMS regularly and verify supplier compliance. Automation tools or cloud-based accounting software help minimize errors and keep GST filings accurate and timely.