New GST Compliance Rules 2025

As we step into the financial year 2025-26, the GST Council has introduced stringent measures to curb tax evasion. For businesses and tax professionals, “business as usual” is no longer an option. Here is a deep dive into the critical changes.

1. Lowered E-Invoicing Threshold

The journey that started with ₹500 Cr turnover has now reached small SMEs. Businesses with an aggregate turnover exceeding ₹2 Crores in any preceding financial year (from 2017-18 onwards) must now generate IRN (Invoice Reference Number) for all B2B transactions.

Impact: Manual invoicing is obsolete. If you don’t generate an E-Invoice, the recipient cannot claim ITC, leading to loss of business.

2. Biometric-Based Aadhaar Authentication

To tackle the menace of fake firms creating “bill trading” rackets, the department has rolled out biometric authentication.

• Who: Applicants flagged as “High Risk” by the automated system.
• Process: Visit the nearest GST Suvidha Kendra for biometric verification of the authorized signatory.

3. Automated Scrutiny of Returns (ASMT-10)

The system now automatically compares:

• Liability: GSTR-1 vs GSTR-3B
• Input Tax Credit: GSTR-3B vs GSTR-2B

If the mismatch exceeds a defined percentage (e.g., 10%), an automated intimation in Form DRC-01B or DRC-01C is issued. Taxpayers must reply or pay within 7 days.

Conclusion

Compliance is moving towards real-time reporting. Accountants must upgrade their skills from simple data entry to data reconciliation and validation. Use tools like Tally Prime or specialized GST software to stay compliant.