From stricter return filing timelines to new invoice rejection rules, July brings a fresh wave of GST compliance mandates that every taxpayer must take note of. While aimed at tightening tax administration and curbing leakages, tax experts warn that many of these changes are likely to increase the compliance burden on businesses.
Here’s a quick breakdown of the key updates that kicked in from July 1, 2025:
Auto-Populated GSTR-3B Becomes Non-Editable
From July 1, the outward tax liability in GSTR-3B—which is auto-populated based on GSTR-1 and GSTR-1A—has become non-editable.
Meaning that a taxpayer can no longer make any manual changes to this figure while filing their monthly returns. This move is intended to reduce mismatches and improve accuracy but restricts flexibility to correct errors on the fly.
New Advisory on Rejected Credit Notes in IMS
The GSTN portal has issued an advisory on handling rejections in the Invoice Management System (IMS).
As per the advisory, in case a customer erroneously rejects a credit note, leading to an increase in tax liability, the taxpayer must upload the credit note again in GSTR-1A of the same month or a later month.
Currently, there is no lock-in mechanism in IMS, which means that customers may reject credit notes even close to the GSTR-3B filing deadline.
Though this may improve checks for the government, tax experts say this process adds to the already high compliance load on taxpayers.
Amendment Required for Rejected Invoices
Another advisory by GSTN states that in case the recipient erroneously rejects an invoice, and the recipient wants to avail ITC on that invoice, the supplier is required to amend the invoice in their return for the same or the next month.
Experts say this rule too will increase compliance work for suppliers, who must now make corrections for errors they didn’t commit.
GST Returns Can’t Be Filed After 3 Years
In a significant change meant to curb long-pending filings and potential misuse, the government has restricted the filing of key GST returns beyond three years from their respective due dates.
This includes returns such as GSTR-1, GSTR-1A, GSTR-3B, GSTR-4, GSTR-5, GSTR-5A, GSTR-6, GSTR-7, GSTR-8, GSTR-9 and GSTR-9C.
This rule will be system-enforced for returns pertaining to the July 2025 tax period and onwards.
E-Way Bill 2.0 Portal Goes Live
A new E-Way Bill 2.0 portal was launched on July 1, 2025 [https://ewaybill2.gst.gov.in]. This is expected to offer greater interoperability with the existing portal [https://ewaybillgst.gov.in], and ensure service continuity during exigencies.
Both portals will work in a real-time synchronised architecture, with e-way bill data mirrored across systems.
Expert Take: More Burden Than Relief?
Experts believe these changes are a mixed bag—offering more structure but at the cost of greater procedural complexity.
An tax expert says, “The proposed changes are related to hard-locking outward liabilities based on filed returns, but ironically, if a customer rejects a credit note just before GSTR-3B filing, it can spike our output tax liability. To reverse that, taxpayers are forced to re-upload documents in GSTR-1A, turning a supposedly simplified system into an added compliance burden.”
As the GST framework becomes more digitised and interconnected, businesses will need to tighten internal processes, automate reconciliations, and stay ahead of deadlines to avoid penalties and errors.
