Goods and Services Tax (GST) was introduced to simplify taxation in India. However, for many small business owners, it remains a maze of deadlines, reconciliations, and complex rules.

A single error in your monthly filing doesn’t just mean a rejected form; it can lead to heavy interest penalties, blocked bank accounts, or even cancellation of your GST registration.

At Finwise Hub, we see entrepreneurs making the same avoid mistakes over and over again. Here are the top 5 GST blunders that could land your business in trouble—and how to fix them before the department sends a notice.

1. Ignoring “Nil” Returns

The Mistake: “I didn’t do any business this month, so I don’t need to file anything.” The Reality: This is the most common myth. Even if your turnover for a month is Zero, you represent legally bound to file a “Nil Return” (GSTR-1 and GSTR-3B).

• The Penalty: A late fee is charged for every single day of delay. If you ignore it for 6 months, your GST registration can be cancelled suomotuo by the department.

2. Claiming Ineligible Input Tax Credit (ITC)

The Mistake: Claiming tax credit on every expense, including personal purchases or blocked categories (like food, gym memberships, or personal vehicles). The Reality: Section 17(5) of the CGST Act specifically blocks ITC on certain goods and services.

• The Solution: Always consult an expert before claiming ITC. Wrong claims lead to interest payments of 24% on the wrongly claimed amount.

3. Mismatch Between GSTR-3B and GSTR-1

The Mistake: Declaring different sales figures in your GSTR-1 (Sales Return) and GSTR-3B (Summary Return). The Reality: The GST portal now automatically flags these mismatches. If your GSTR-1 says you sold goods worth ₹10 Lakhs, but your GSTR-3B says ₹8 Lakhs to pay less tax, you will receive an automated scrutiny notice.

• The Solution: Periodic reconciliation is mandatory. At Finwise Hub, our software ensures these two figures match perfectly before submission.

4. Forgetting Reverse Charge Mechanism (RCM)

The Mistake: Assuming the seller is always liable to pay GST. The Reality: In certain cases (like hiring a Goods Transport Agency, Legal Services from Advocates, or buying from unregistered dealers), the buyer (you) has to pay the tax to the government. This is called Reverse Charge.

• The Risk: Non-payment of RCM is treated as tax evasion.

5. Not Generating E-Way Bills on Time

The Mistake: Moving goods worth more than ₹50,000 without an E-Way Bill, or with an expired one. The Reality: If your truck is intercepted without a valid E-Way Bill, the officer can detain the goods and levy a penalty equal to 200% of the tax amount.

Compliance is Cheaper Than Penalties

Trying to save a few thousand rupees by filing GST yourself often costs lakhs in penalties later. GST is not just data entry; it is law.

At Finwise Hub, our team of Chartered Accountants ensures:

• 100% Accurate ITC Reconciliation.

• Timely filing of GSTR-1, GSTR-3B, and GSTR-9 (Annual Return).

• Instant response to any Department Notices.

Stop worrying about due dates. Let us handle your taxes.