GST Compliance Guide

GSTR-1 & GSTR-3B Filing Guide for Indian Manufacturers (May 2026 Edition)

Written by CA Pooja Mehta (GST & Indirect Tax Advisor). Reviewed by Jainam Shah (Founder, ERPDrive). Published 19 May 2026. We update this article when GST rules, compliance thresholds or IATF standards change.

Published 19 May 2026 14 min read CA Pooja Mehta

GSTR-1 vs GSTR-3B: what each one does

GSTR-1 is the outward-supply return. You file it monthly (or quarterly under QRMP) and it lists every taxable invoice you issued during the period: B2B invoices, B2C large invoices (above INR 2.5 lakh inter-state), B2C small (aggregated), credit/debit notes, exports, and the HSN-wise summary in Table 12. GSTR-1 data flows automatically to your buyer's GSTR-2A and GSTR-2B.

GSTR-3B is the summary return. You file it monthly regardless of QRMP status (QRMP-eligible taxpayers can file 3B quarterly but most file monthly). It declares your total outward supplies, the input tax credit (ITC) you are claiming, and the net GST liability you pay. It is the return that actually moves money.

GSTR-1 and GSTR-3B are two views of the same business activity, filtered for different purposes. The outward-supply value in GSTR-3B (Table 3.1.a) should reconcile with the total taxable value in GSTR-1 (sum of B2B + B2C + exports). If they do not match, the portal flags it and the GSTN auto-reconciliation tool catches the difference.

Due dates in May 2026

Under the standard monthly filing cycle (taxpayers with aggregate turnover above INR 5 crore or those who opt out of QRMP):

  • GSTR-1 (monthly): 11th of the following month. April 2026 GSTR-1 was due 11 May 2026.
  • GSTR-3B (monthly): 20th of the following month. April 2026 GSTR-3B was due 20 May 2026.
  • QRMP GSTR-1 (quarterly): 13th of the month following the quarter. Q1 FY26 (Apr-Jun) GSTR-1 due 13 July 2026.
  • QRMP GSTR-3B (monthly under QRMP): 20th, 22nd, or 24th depending on state group (per CBIC Notification 21/2019). For Maharashtra, Gujarat, Karnataka: 20th. For most other states: 22nd. For 9 NE states + Andaman: 24th.
  • QRMP optional invoice furnishing (IFF) for B2B invoices in months 1 and 2 of a quarter: 13th of the following month.

GSTR-1 tables you need to understand

GSTR-1 has 13 tables. Manufacturers commonly use:

  • Table 4A: B2B regular invoices (registered customers). The largest table by line count for most manufacturers.
  • Table 4B: B2B invoices attracting reverse charge (uncommon for most manufacturers; mainly for specific notified services).
  • Table 5A: B2C large invoices, inter-state above INR 2.5 lakh.
  • Table 6A: Exports without payment of IGST (under LUT).
  • Table 6B: Exports with payment of IGST (claim refund).
  • Table 7: B2C small invoices, aggregated by state + rate.
  • Table 9A, 9B, 9C: Amendments to earlier invoices (corrections of HSN, tax rate, value, GSTIN).
  • Table 11: Advances received and adjusted.
  • Table 12: HSN-wise summary (mandatory, must reconcile with sum of invoice-level data).
  • Table 13: Documents issued during the period (count of invoices, credit notes, etc.).

GSTR-3B tables you need to understand

GSTR-3B is simpler - eight tables most of which are auto-populated in 2026:

  • Table 3.1: Outward supplies. 3.1(a) taxable supplies (other than zero-rated, nil-rated, exempt), 3.1(b) zero-rated supplies (exports/SEZ with LUT), 3.1(c) other outward supplies (exempt, nil-rated).
  • Table 3.1.1: Supplies through e-commerce operators (uncommon for direct manufacturers).
  • Table 3.2: Inter-state outward supplies to unregistered persons, composition, UIN holders.
  • Table 4: Eligible ITC. 4A all ITC available, 4B ITC reversed (rule 42/43, ineligible), 4C net ITC available.
  • Table 5: Exempt, nil-rated, and non-GST inward supplies.
  • Table 5.1: Interest and late fee payable.
  • Table 6.1: Payment of tax (set off ITC, then cash ledger).

GSTR-2B reconciliation: the critical monthly task

GSTR-2B is the system-generated, static ITC statement issued by GSTN on the 14th of each month. It lists all the invoices uploaded by your vendors in their GSTR-1 that you can claim ITC on. Crucially, only ITC matching GSTR-2B is allowed (per rule 36(4), reinforced by rule 36(5) effective 1 January 2022 - reference CBIC Notification 39/2021).

Your GSTR-3B Table 4A ITC claim must come from GSTR-2B. If you claim ITC that does not appear in GSTR-2B (because your vendor did not file GSTR-1 or filed wrong values), the claim is ineligible and the auto-population will reverse it. So every month, before filing GSTR-3B, you must reconcile your purchase register against GSTR-2B.

The reconciliation finds three buckets:

  • Matched: invoice in your register matches an entry in GSTR-2B. Claim the ITC.
  • Unmatched in 2B: invoice in your register but not in GSTR-2B. Vendor probably has not filed GSTR-1 yet. Do not claim ITC this month; follow up with vendor.
  • Extra in 2B: entry in GSTR-2B but not in your register. Either a missed purchase or an erroneous upload by another supplier. Investigate before adding to register.
  • Mismatched values: same invoice, different value or tax rate. Reconcile with vendor and book the correct value.

Common GSTR-1 filing mistakes

From the 200+ GSTR-1 returns Pooja files each month, these mistakes account for over 75% of issues:

  • Mismatched HSN between invoice tables and Table 12. Portal validation fails. Re-run your HSN summary from invoice data, do not edit Table 12 manually.
  • Wrong place of supply (POS). POS determines IGST vs CGST+SGST. POS is the state of the buyer (for goods), not the state of delivery for some specific exceptions.
  • B2C invoices reported as B2B. Happens when the buyer GSTIN field is filled with a dummy or expired GSTIN. The portal does not always catch this; the buyer's GSTR-2A will show garbage.
  • Reverse charge invoices not marked. Specific notified services attract reverse charge. If you miss the reverse-charge flag, the buyer cannot claim ITC.
  • Credit notes filed against the wrong original invoice. Each credit note must reference an original invoice number. Mistyping the original invoice number is the most common credit note error.
  • Late filing. Late filing fee under section 47 of CGST Act is INR 50 per day (CGST + SGST combined) for non-nil returns, INR 20 per day for nil returns, capped at INR 10,000.

Common GSTR-3B filing mistakes

GSTR-3B is shorter, so mistakes are fewer in count but bigger in money impact:

  • Claiming ITC not in GSTR-2B. The most expensive mistake. The ITC will be reversed (rule 36(4)/(5)) and you may owe interest under section 50.
  • Outward supply mismatch with GSTR-1. If 3B Table 3.1(a) does not match GSTR-1 sum, the portal flags a Form GSTR-1A reconciliation requirement.
  • Interest calculation error. Interest is 18% per annum on net tax liability, computed daily from the due date.
  • Setting off ITC incorrectly. IGST credit must first be used against IGST liability, then against CGST, then SGST. Cross-utilization rules are strict.
  • Filing GSTR-3B before GSTR-1. While technically allowed, this prevents the auto-population of outward supplies and forces manual entry, which is error-prone.

Late fees and interest

Late filing fees (section 47):

  • GSTR-1 late fee: INR 50 per day (INR 25 CGST + INR 25 SGST), INR 20 per day for nil returns. Maximum INR 10,000.
  • GSTR-3B late fee: same as GSTR-1.
  • Annual return (GSTR-9) late fee: INR 200 per day (INR 100 CGST + INR 100 SGST). Maximum 0.5% of turnover.

How ERP software automates GSTR-1 and GSTR-3B

Any modern manufacturing ERP should produce GSTR-1 and GSTR-3B in JSON or Excel format directly from invoice and purchase data, without any double-entry.

  • Pull every B2B invoice with valid GSTIN into Table 4A.
  • Auto-aggregate B2C invoices by state + rate into Table 7.
  • Build Table 12 HSN summary from item-master HSN, by total quantity, value, and tax split (B2B/B2C separated).
  • Pull GSTR-2B from the GSTN API and reconcile against the purchase register, producing a 3-bucket exception report.
  • Compute net tax liability and produce a payment-set-off recommendation that respects cross-utilization rules.
  • Generate the JSON file in the GSTN format for direct upload.

Frequently Asked Questions

What is the difference between GSTR-1 and GSTR-3B?

GSTR-1 is the outward-supply return that lists every taxable invoice issued during the month. GSTR-3B is the summary return that declares total outward supplies, total ITC claimed, and net GST payable. GSTR-1 data flows to your buyer's GSTR-2A/2B. GSTR-3B is the return that actually moves money - it determines what you pay to the government. Both are filed monthly (or quarterly under QRMP for GSTR-1).

What are the GSTR-1 and GSTR-3B due dates for May 2026?

GSTR-1 is due on the 11th of the following month. GSTR-3B is due on the 20th of the following month for taxpayers in Maharashtra, Gujarat, Karnataka, and most southern states. For QRMP filers, GSTR-1 is quarterly (13th of the month following the quarter) and GSTR-3B is monthly with state-group-based due dates of 20th, 22nd, or 24th per CBIC Notification 21/2019.

What is GSTR-2B and why does it matter?

GSTR-2B is the system-generated ITC statement issued on the 14th of each month. It lists all invoices uploaded by your vendors in their GSTR-1 that you can claim ITC on. From 1 January 2022, ITC claims in GSTR-3B Table 4A must come from GSTR-2B per rule 36(4) and 36(5). Claiming ITC not appearing in GSTR-2B is the most common cause of return-filing penalties and audit notices.

What happens if I file GSTR-1 or GSTR-3B late?

Late filing fee under section 47 of CGST Act is INR 50 per day (INR 25 CGST + INR 25 SGST) for non-nil returns, INR 20 per day for nil returns, capped at INR 10,000. In addition, interest at 18% per annum is charged on the net tax liability from the due date until payment under section 50 of CGST Act.

Can I file GSTR-3B without filing GSTR-1?

Technically yes, GSTR-3B can be filed before GSTR-1, but it is not recommended. Filing GSTR-1 first auto-populates Table 3.1 of GSTR-3B with outward supplies, which reduces errors. Filing 3B without 1 forces manual entry and increases reconciliation risk. The GST portal also flags a GSTR-1A requirement if the two returns do not match.

How is interest calculated on late GST payment?

Interest is 18% per annum on the net tax liability (tax payable in cash after ITC set-off), computed daily from the due date until actual payment. Formula: Interest = Net Tax × 18% × (Days Late / 365). For example, INR 1 lakh paid 10 days late = INR 1,00,000 × 18% × 10/365 = INR 493 interest. Interest must be paid in cash and cannot be set off against ITC.

How does ERP software automate GSTR-1 and GSTR-3B filing?

Modern manufacturing ERPs like ERPDrive generate GSTR-1 and GSTR-3B JSON files directly from invoice and purchase data. The system pulls every B2B/B2C invoice into the right table, auto-aggregates HSN summary in Table 12, pulls GSTR-2B from the GSTN API to reconcile ITC, computes net tax liability, applies correct ITC set-off rules, and produces JSON files ready for upload. Eliminates manual Excel work and the most common source of return-filing errors.

Sources & References

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