Staying informed about Goods and Services Tax (GST) changes is essential for small businesses to remain compliant and avoid unnecessary penalties. May 2025 brings several important updates in GST that can impact daily operations, filing schedules, and compliance norms. In this blog, we break down the key changes, what they mean for small businesses, and how you can prepare for them.
📌 Key GST Updates Announced in May 2025
1. Revised Thresholds for E-Invoicing
The GST Council has reduced the e-invoicing threshold from ₹5 crore to ₹3 crore annual turnover. Businesses crossing ₹3 crore must now generate e-invoices through the government portal.
Impact: More MSMEs will now need to adapt e-invoicing systems and integrate them into their billing processes.
Learn more about e-invoicing on the GST portal
2. New Return Filing Utility (GST Sahaj and Sugam)
The simplified return filing formats, GST Sahaj and Sugam, have now been rolled out for small taxpayers. These are tailored for businesses with turnover up to ₹5 crore.
Benefits:
- User-friendly interfaces
- Reduced data entry
- Quicker filing process
3. Auto-population of GSTR-3B from GSTR-1 and GSTR-2B
Auto-population of figures in GSTR-3B using GSTR-1 and GSTR-2B is now mandatory for businesses with turnover above ₹5 crore.
Why it matters:
- Reduces clerical errors
- Faster reconciliation of Input Tax Credit (ITC)
4. Stricter Action on Late Filings and Mismatches
GSTN has begun auto-generating notices for repeated mismatches between GSTR-1 and GSTR-3B, and for habitual late filers.
Penalty:
- Penalties ranging from ₹5,000 to ₹25,000
- Suspension of GSTIN for repeat offenses
Refer to Section 73 and Section 74 for more on notice penalties.
5. Mandatory 2-Factor Authentication for GST Portal Logins
To improve security, two-factor authentication is now mandatory for all GST portal users.
Tips for Businesses:
- Register mobile and email IDs correctly
- Keep login credentials confidential
✅ What Small Businesses Should Do Now
- Upgrade Billing Software: Ensure compatibility with e-invoicing requirements.
- File Returns on Time: Stick to deadlines to avoid penalties.
- Reconcile ITC Monthly: Use auto-populated data for accurate filing.
- Use New Sahaj/Sugam Forms: If eligible, shift to these simplified formats.
- Monitor GST Notices: Regularly check portal for any notices or discrepancies.
📅 Important GST Return Due Dates – May 2025
| Return Type | Description | Due Date |
|---|---|---|
| GSTR-1 | Outward Supplies | 11th May |
| GSTR-3B | Summary Return | 20th May |
| GSTR-5/5A | For Non-Resident Taxpayers | 13th May |
| GSTR-6 | Input Service Distributors | 13th May |
| GSTR-7 | TDS Deductors | 10th May |
| GSTR-8 | TCS Collectors | 10th May |
Check the official GST calendar for all deadlines.
🔍 Frequently Asked Questions (FAQs)
Q1. Are e-invoices mandatory for all businesses now? No. As of May 2025, businesses with turnover above ₹3 crore must generate e-invoices.
Q2. What if I don’t shift to Sahaj or Sugam formats? They are optional but highly beneficial for small taxpayers due to their simplicity.
Q3. How can I avoid GST mismatch notices? Ensure that GSTR-1 and GSTR-3B filings are reconciled properly each month.
Q4. Is late filing penalty waived in any case? Only under special relief schemes announced by the GST Council. Otherwise, penalties apply.
Q5. Can I update my contact info for 2FA? Yes, log in to the GST portal and update your registered mobile/email under profile settings.
📣 Call to Action
Don’t let GST updates catch you off guard. At Tax MSME, we help you stay ahead with timely filings, ITC reconciliation, and notice management. Need help with GST filing or e-invoicing setup?
👉 Contact our experts now or call us at 9830038840.
