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Three Year Rule for GST Returns Becomes Active from August 2025

If you’ve been putting off filing your old GST returns, it's now or never. Starting August 1, 2025, the GST portal will permanently block returns that are older than three years from their due date. This new rule was introduced as part of the Finance Act, 2023, and officially kicked in from October 1, 2023.

The GSTN (Goods and Services Tax Network) has already issued an advisory back on October 29, 2024, and now, with the implementation date getting closer, businesses need to act fast to avoid non-compliance.

What's the New Rule?

As per the amendment brought in through the Finance Act, 2023 and Notification No. 28/2023 – Central Tax dated 31st July, 2023, the following provisions have been updated:

GST returns will not be allowed to be filed after three years from the due date under:

Section 37 – Outward Supply (GSTR-1)
Section 39 – Payment of Tax (GSTR-3B, GSTR-4, etc.)
Section 44 – Annual Return (GSTR-9/9C)
Section 52 – TCS Return (GSTR-8)

This means if you haven’t filed your return within three years of its due date, you will permanently lose the ability to file it, even if you’re willing to pay the penalty.

Why It Matters

Many taxpayers, especially MSMEs and businesses with dormant GSTINs, tend to miss or delay filing older returns. With this move, the GST department is making it clear — compliance needs to be timely.

Failure to file past returns will lead to:

Inability to claim or pass Input Tax Credit (ITC)
Heavy late fees and interest
Risk of GSTIN cancellation
Barred access to compliance correction

Returns Affected from August 1, 2025

Here’s a snapshot of returns that will become barred from filing starting August 1, 2025:

Key Deadlines You Must Track

Last chance to file GSTR-3B for June 2022: Before July 31, 2025
Last chance to file GSTR-9/9C for FY 2020-21: Before July 31, 2025
Any return due before August 2022 will become permanently blocked if not filed by July 31, 2025

What You Should Do Now

If you or your clients have pending GST returns for the affected periods, time is running out. Here’s how to stay compliant:

Reconcile your records: Match purchase and sales data, credit notes, and debit notes.
Check GSTR-2A/2B: Review Input Tax Credit entries and ensure correct vendor data.
Review return filing status: Log in to the GST portal and verify all return statuses.
File immediately: Prioritize returns nearing the 3-year mark.
Consult your tax advisor: In case of errors, mismatches, or confusion.

Why This Advisory Matters

This isn’t just a compliance alert - it’s a compliance cutoff.

GST returns are the foundation of a business’s indirect tax profile. If past returns are missing, it creates long-term complications in audits, assessments, and refund claims. It may even impact your vendor relationships, especially if ITC mismatches arise due to your non-filing.

Common Questions

Q: Can I file a return after three years with late fees?

‍A: No. Once the three-year window is over, the portal will restrict filing irrespective of willingness to pay penalties.

Q: Will I be able to claim ITC from these old returns later?

‍A: No. You forfeit the ability to claim ITC if the return is not filed within the permitted time.

Q: Does this apply to NIL returns?

A: Yes. Even NIL returns will be barred if not filed within three years of the due date.

Conclusion

The GST system is becoming increasingly strict on compliance timelines. This latest move reinforces the government’s push towards timely and accurate filing. Don’t let three years of delay cost you your compliance status.