GST Rules in India: Quick Answer for 2026
GST compliance means getting registered when required, charging the correct tax, issuing valid invoices, filing returns, paying tax and claiming eligible input tax credit (ITC). Your obligations depend on your goods or services, turnover, state, type of customer and registration category.
India's GST structure changed significantly from 22 September 2025: most taxable supplies now fall under 5% or 18%, with a special 40% rate for selected supplies and separate exemptions or special rates. Do not use an old five-slab chart to classify a product. Consult the relevant current rate notification and HSN/SAC entry. The GST Council's 8 October 2026 proposals must not be treated as law unless implemented by the appropriate legal instruments.
| Compliance item | General position in October 2026 |
|---|---|
| Goods-only registration | Generally ₹40 lakh in eligible states; lower thresholds and exceptions apply |
| Services or mixed supplies | Generally ₹20 lakh; ₹10 lakh in specified states |
| Main GST rates | Primarily 5% and 18%; 40% special rate, exemptions and other specific treatments |
| Regular returns | GSTR-1 for outward supplies and GSTR-3B for liability/payment |
| QRMP | Eligible taxpayers with aggregate annual turnover up to ₹5 crore |
| E-invoicing | Generally applies to notified taxpayers with turnover of ₹5 crore or above, subject to exclusions |
| E-way bill | Generally for goods consignments exceeding ₹50,000, subject to exceptions |
These are broad rules, not a determination for every business. A section 24 registration obligation, a state-specific limit or a special scheme can change the result.
What Is GST and Which Tax Applies?
GST is a destination-based indirect tax on the supply of goods or services. The Central Goods and Services Tax (CGST) Act, 2017 and associated state and integrated GST laws govern the system.
- CGST + SGST/UTGST: Generally apply to taxable intra-state supplies.
- IGST: Generally applies to taxable inter-state supplies and imports, subject to applicable import rules.
- Exempt or outside-GST supplies: Do not assume they are interchangeable. For example, alcoholic liquor for human consumption falls outside GST; a notified exempt supply remains within the GST framework but attracts no GST.
Example: A taxable intra-state sale of ₹1,00,000 at an illustrative 18% GST has CGST of ₹9,000 and SGST of ₹9,000. An otherwise comparable inter-state sale has IGST of ₹18,000. The applicable rate must first be verified for the actual HSN/SAC classification.
GST Rates After the September 2025 Reform
The 56th GST Council meeting led to a simplified standard structure, implemented for many supplies from 22 September 2025. Government guidance identifies Notification 9/2025-Central Tax (Rate), dated 17 September 2025, for revised goods rates, and Notification 10/2025-Central Tax (Rate) for goods exemptions. Rates for services and any later amendments must also be checked separately.
| Treatment | Meaning | Business action |
|---|---|---|
Nil/exempt | Specified supplies attract no GST | Verify the exemption notification and ITC consequences |
5% | Reduced rate for specified taxable supplies | Check exact goods/services classification and conditions |
18% | Main standard rate for many other supplies | Avoid applying by default without classification |
40% | Special rate for specified luxury or demerit supplies | Confirm exact notification, taxable value and transition rules |
Other specific treatment | Certain products, services and transitional categories have separate rules | Verify the effective notification before invoicing |
Common mistake: Applying 12% or 28% from an old spreadsheet to a fresh 2026 invoice. A past rate may still matter when determining tax on an earlier supply or a transitional transaction, but it cannot replace a check of the operative rate and time-of-supply rules.
For official changes see the 56th GST Council FAQs and CBIC's clarification on the 2025 rate notifications .
Who Must Register for GST?
Registration is generally based on aggregate turnover computed on an all-India PAN basis, but the threshold depends on the nature of supply and the relevant state. Businesses exclusively supplying goods may qualify for the ₹40 lakh exemption in eligible states; lower limits apply in certain states and for certain goods. For service providers and businesses supplying both goods and services, the standard ₹20 lakh threshold is commonly relevant, with ₹10 lakh in specified special-category states.
Some persons must register even below the normal turnover threshold under section 24 of the CGST Act, subject to specific exemptions—for example, certain casual taxable persons and persons covered by other compulsory-registration provisions. Do not assume that every inter-state service provider or every small e-commerce seller must register from their first rupee: targeted exemptions exist.
Checklist before deciding: Determine the supplier's constitution, PAN-wise aggregate turnover, principal state, supply mix, place of supply, online marketplace arrangements and applicable notifications.
Businesses below their applicable limit can apply voluntarily, but registration brings invoice, return and payment duties. For assistance, see TaxQue GST Registration.
Registration process and 2026 context
- Start an application under Services → Registration → New Registration on the GST portal Official ↗.
- Complete FORM GST REG-01 and provide the prescribed identity, constitution and premises evidence.
- Complete Aadhaar authentication or another required verification process.
- Track the application reference number (ARN); respond to a valid REG-03 clarification with REG-04 within the applicable time limit.
- Download the registration certificate (REG-06) on approval and complete relevant post-registration formalities.
The GST portal provides a Rule 14A option for qualifying applicants meeting the prescribed monthly criterion. Do not confuse this with the general turnover exemption. The 57th GST Council meeting on 8 October 2026 proposed additional registration, refund and return reforms; the recommendations are not automatically operative rules.
GST Invoice, HSN/SAC and E-Invoicing Requirements
An ordinary GST tax invoice should include the prescribed particulars under Rule 46, as applicable: supplier GSTIN and address, unique consecutive invoice number, date, recipient particulars, goods/services description and HSN/SAC, taxable value, applicable tax rates and amounts, place of supply where relevant and authentication details. A composition dealer or supplier of exempt supplies generally issues a bill of supply, subject to the applicable rules.
HSN/SAC reporting varies with turnover and the return requirements. The GST portal's GSTR-1 guidance Official ↗ describes 4-digit and 6-digit HSN requirements for different turnover categories.
When is e-invoicing mandatory?
Under the notified e-invoicing system, specified registered businesses whose aggregate turnover reached ₹5 crore or more in an applicable preceding year are generally covered, with notified exclusions. Issuing an ordinary PDF invoice is not equivalent to obtaining an Invoice Reference Number (IRN) from an Invoice Registration Portal. For taxpayers with AATO of ₹10 crore or more, the official system introduced a 30-day IRP reporting restriction from 1 April 2025. Check the current official e-invoice portal Official ↗ for applicability and operational advisories.
GST Return Filing and Due Dates
Most regular taxpayers report outward supplies in GSTR-1 and declare and discharge liability in GSTR-3B. GSTR-2B is an auto-drafted ITC statement; it is not a return that a recipient files.
| Filing | Purpose | Ordinary due-date pattern |
|---|---|---|
GSTR-1 (monthly) | Outward supplies | 11th of the next month |
GSTR-1 (QRMP) | Quarterly outward supplies | 13th of the month after the quarter |
GSTR-3B (monthly) | Summary tax liability, ITC and payment | 20th of the next month |
GSTR-3B (QRMP) | Quarterly liability and payment | 22nd or 24th after the quarter, according to state/UT |
CMP-08 | Composition taxpayer's quarterly statement/payment | 18th after the quarter, ordinarily |
GSTR-9 / GSTR-9C | Annual return / reconciliation, where applicable | Check the relevant FY, turnover limits and notifications |
Due dates may be extended by valid government notifications. QRMP allows eligible businesses with annual aggregate turnover up to ₹5 crore to file GSTR-1 and GSTR-3B quarterly while paying tax monthly. Do not confuse quarterly filing with quarterly payment.
Example: A monthly filer reporting October 2026 transactions would ordinarily file GSTR-1 by 11 November 2026 and GSTR-3B by 20 November 2026, assuming no notified extension or special relief.
Check the official GSTR-1 guide Official ↗, GSTR-3B guide Official ↗ and QRMP guide Official ↗.
Input Tax Credit (ITC): Conditions and Examples
ITC reduces the tax payable on taxable outward supplies, but a purchase invoice alone does not establish entitlement. Broad conditions under section 16 of the CGST Act, read with the rules, include:
- Holding a valid tax invoice or prescribed document.
- Actual receipt of the goods or services, subject to statutory deeming provisions.
- Relevant supplier invoice details being furnished and communicated through the prescribed system, including GSTR-2B where applicable.
- Tax being paid to the government, subject to the statutory framework.
- Filing the applicable return and observing blocked-credit provisions under section 17(5).
- Following payment-to-supplier, reversal/re-availment and time-limit requirements where relevant.
Illustration: A business has output GST of ₹36,000 and eligible input GST of ₹14,000. Its net GST liability is ₹22,000, before considering any adjustments or interest. If ₹4,000 of the claimed input tax relates to blocked or otherwise ineligible purchases, eligible ITC is ₹10,000 and the liability becomes ₹26,000.
Reconcile the purchase register with GSTR-2B, investigate missing invoices and maintain supporting records. For most invoices, the section 16(4) cut-off refers to 30 November after the relevant financial year, or the date of filing the annual return, whichever is earlier, subject to statutory exceptions. Do not treat the GSTR-2B appearance alone as a guarantee of credit.
E-Way Bills and Movement of Goods
An e-way bill is ordinarily required for covered movement of goods when the consignment value exceeds ₹50,000 under Rule 138. Exemptions, specific movements and state rules can alter the requirement, sometimes including movements below the usual threshold.
Before dispatch, check the invoice or delivery challan, goods description, consignment value, vehicle/transporter details and distance. Generate the required document on the official e-way bill portal Official ↗. The government e-way bill FAQ Official ↗ explains exceptions and validity rules.
Composition Scheme and Annual Compliance
Eligible small businesses may choose the composition levy instead of regular GST, subject to turnover ceilings, supply restrictions and prescribed rates. The common goods-oriented threshold is ₹1.5 crore in most states, with a lower threshold in specified states; a separate concession exists for eligible service suppliers up to ₹50 lakh. Composition taxpayers generally cannot collect GST separately or claim ITC on purchases. Confirm the exact eligibility before opting in.
Annual-return obligations also depend on the financial year and applicable notifications. GSTR-9 may be exempted for smaller taxpayers, while GSTR-9C is required only above its prescribed turnover threshold. Use the official GSTR-9 filing manual Official ↗, not an old generic threshold chart, to check your applicable year.
Penalties, Interest and Common Mistakes
GST non-compliance can trigger late fees, interest, demands, penalties, blocked portal actions or registration proceedings. The amount depends on the default and the law applicable to it. It is misleading to say every late return attracts one fixed total penalty.
Avoid these frequent errors:
- Using obsolete GST rates rather than checking the current HSN/SAC notification.
- Missing compulsory registration triggers while looking only at turnover.
- Claiming ITC without reconciliation or on blocked-credit purchases.
- Filing GSTR-1 but not GSTR-3B, assuming the outward return pays the tax.
- Ignoring e-invoicing or e-way bill applicability when turnover or movements increase.
- Treating October 2026 GST Council proposals as enacted law. Amendments need the relevant legal implementation.
Monthly GST Compliance Checklist
- ○ Match sales invoices, credit notes and debit notes with GSTR-1.
- ○ Confirm rate classification and tax place-of-supply treatment.
- ○ Reconcile purchase records, supplier uploads and GSTR-2B.
- ○ Review blocked ITC, reversals and reverse-charge transactions.
- ○ Verify e-invoice IRNs and e-way bills wherever mandatory.
- ○ Compute GSTR-3B, pay liabilities and file by the applicable due date.
- ○ Download acknowledgements and retain the supporting records.
- ○ Review registration, bank, address and authorised-signatory changes.
What Changed at the 57th GST Council Meeting?
On 8 October 2026, the Council recommended measures involving registration simplification, return corrections, refund processes and enforcement provisions. These announcements are relevant to future GST compliance, but the effective legal position depends on subsequent legislation, rules and notifications. A proposal to reduce a penalty or change an approval process should not be applied to current cases solely because it appears in the Council press release.
Read the official 57th GST Council recommendations and monitor CBIC Official ↗ for implementing instruments.
Conclusion
For 2026, reliable GST compliance starts with three checks: correct registration status, correct tax treatment and timely reconciled returns. Use current government notifications rather than recycled rate charts, preserve documentation for ITC and invoices, and distinguish Council announcements from enacted changes. Businesses needing help with registration can review TaxQue's GST registration service.
Official Sources and References
- GST Council / PIB — September 2025 GST reform FAQs
- PIB — CBIC rate notifications explained
- PIB — 57th GST Council recommendations, 8 October 2026
- GST Portal — GSTR-1 Official ↗ and GSTR-3B Official ↗
- GST Portal — QRMP Official ↗
- E-Invoice Portal Official ↗ and E-Way Bill FAQs Official ↗
Legal information checked on 27 October 2026. This general guide is not a substitute for transaction-specific professional advice. Check current government notifications and applicable state rules before acting.
