GSTR 9C Applicability for FY 2025-26 – Who Needs to File and Who Is Exempt

For every business owner around December, they all go through a similar type of anxiety. They are calling their accountant at all hours of the day; accountants are overwhelmed with reconciliation, trying to sort through what must be filed and when, and whether they have missed important deadlines. A big part of that December stress? GSTR 9C applicability.

And honestly, a lot of it is avoidable, not by ignoring the form, but by actually understanding it well before the deadline creeps up. So that is what this post is about. Understanding GSTR-9C for the financial year ending 31 March 2026 in a conversational manner (and not like a government way). 

What Is GSTR 9C?

As a business registered for GST at the end of the year, you have to prepare a report called GSTR 9C. This report is about comparing the numbers in your financial statements with the numbers in your GST Returns like GSTR 1, GSTR 3B, and GSTR 9. You do GSTR 1 and GSTR 3B every month during the year. When the year ends, you do your GST return, which is GSTR 9. Then you do GSTR 9C, which basically asks if the numbers in your statements match the numbers in your GST Returns. You have to make sure the figures in your statements agree with those in GSTR 1, GSTR 3B, and GSTR 9. This is a part of the GST reconciliation process. The GSTR 9C form helps you verify that your financial statements and GST Returns are consistent. So you need to check your numbers to ensure they match. Using cloud accounting software can help you with structuring data.  This way, you can complete GSTR 9C accurately. The report is a part of your GST obligations. It helps you ensure everything is in order.

GSTR 9C Applicability for FY 2025-26 

The rule is not complicated. If your aggregate annual turnover crossed ₹5 crore in FY 2025-26, GSTR 9C applies to you. Now, “aggregate turnover” here means your total turnover calculated at the PAN level not per GSTIN. So if you have registrations in three different states, the turnover from all three gets added together. Cross ₹5 crore in total, and every GSTIN under that PAN has to file GSTR 9C.

Here is how the turnover slabs break down:

Aggregate Annual Turnover	GSTR 9	GSTR 9C
Up to ₹2 crore	Optional	Not required
₹2 crore to ₹5 crore	Mandatory	Not required
Above ₹5 crore	Mandatory	Mandatory

If your sales are below ₹5 crore, you do not need to file GSTR 9C. However, once your sales exceed ₹5 crore, both forms must be submitted. 

Who Is Completely Off the Hook?

You will not need to file GSTR 9C if you are classified in any of the following categories:

• Businesses with annual sales under ₹5 crore in FY 2025-26. 
• Composition scheme taxpayers
• Input Service Distributors
• Casual taxable persons
• Non-resident taxable persons

If you are in any of these buckets, GSTR 9C is not your problem this year. Move on.

The Due Date and Why December Is Too Late to Start

To ensure that GSTR 9 applicability is within the due date, and postponing GSTR 9C does not stop the taxable person from accruing new taxes. Same as GSTR 9.

But here is the thing people keep getting wrong: December is the deadline, not the starting point. GSTR 9C asks you to reconcile a full year of data. Your turnover, your ITC, your tax payments, your credit notes, everything needs to line up across your returns and your audited financials. If you wait until November to even look at this, you are setting yourself up for a rough couple of months.

Also worth knowing: as per CBIC Circular No. 246/03/2025, the annual return is only treated as complete when both GSTR 9 and GSTR 9C are submitted. Late fees keep running until both are filed. Filing GSTR 9 on time and leaving GSTR 9C pending does absolutely nothing to stop the meter.

What Happens If You Miss the Deadline?

A late fee is ₹200 a day i.e. ₹100 under CGST and ₹100 under SGST – maximum 0.25% of yearly turnover by state. Also, under Section 125 of the CGST Act, authorities have the discretion to impose a general penalty up to ₹25,000 for failings to file. After you are noted in their system, you will receive many notices/communications for non-filing, costing you much more than just doing your work on time. 

Documents/Procedures needed Before Filing

This is actually where the most significant amount of effort goes into. You should have with you before accessing the portal;

• Audit-financials for FY 2025-2026
• Every GSTR 1 and GSTR 3B filed between April 2025 and March 2026 
• A completed or near-complete GSTR 9
• GSTR 2B data for the full year
• Rate-wise tax liability workings
• ITC reversal and reclaim details under Rule 37 and Rule 37A
• DRC-03 payment challans if additional liability was paid at any point
• HSN-wise summaries for outward and inward supplies

If this list makes you anxious, that is actually useful information — it tells you your records need some work. Better to find out now than in November.

The Two Parts of GSTR 9C

Part A- however, the reconciliation statement combines the audited revenue amount you’ve finished up without any GST adjustments (to make sure you have all the revenue adjustments) to come up with your GST Revenue amount, then you’ll compare that GST Revenue value against your GSTR 9 revenue amount. 

Any gaps you cannot explain become additional liability. You pay that via DRC-03 and report it in Table 11.

Part B: Your authoriser declares that everything in Part A is true from your point of view.

Most of the issues with the Tables of ITC Reconciliation – especially with respect to Rule 37 and Rule 37A – occur here. If you reversed ITC because you did not make a payment to the supplier within 180 days, but subsequently made a payment later, your reclaimed ITC would belong to the reclaimed year and not the year of the original invoice. It’s a subtlety, but it creates confusion for many people! 

Mistakes That Keep Showing Up in GSTR 9C Filings

A few things that come up again and again:

1. Unexplained differences in turnover. Your accounting records will show amounts for salaries, loans and interest income, but they do not form part of your GST turnover and therefore need to be clearly excluded. If you do nothing about them, you are sending out a red flag.

2. Credit notes after March. Credit notes raised after March 2026 in respect of supplies made in FY 2025/26 need to be treated carefully when you are reconciling your GST accounts. Many people either don’t consider them or they treat them incorrectly.

3. ITC in books higher than your GSTR 3B, without any explanation of why. If you have chosen not to claim any ITC during the year, then that should be clearly noted. Otherwise, it may be construed that you have either made an error or deliberately tried to avoid reversing. However, a reliable cloud accounting software can help you with the same. 

4. Trying to submit a GSTR 9C before finishing a GSTR 9 filing will result in the online filing system preventing you from doing so. Additionally, working on both forms simultaneously may confuse you; please submit your GSTR 9 first and then start working on your GSTR 9C.

This Is Where GST Billing Software Changes the Game

Here is something nobody talks about enough. Most of the pain in GSTR 9C reconciliation is not created in December. It is created throughout the year, every invoice that gets missed, every ITC entry that does not match the GSTR 2B, every mismatch between what GSTR 1 says and what the books say. By December, you are discovering twelve months of small problems all at once.

The businesses that sail through GSTR 9C are usually the ones using proper GST billing software throughout the year. When your invoicing, your purchase entries, and your GST returns are all living inside the same system, discrepancies get caught as they happen — not when you are staring at a reconciliation statement that refuses to balance.

MargBooks is built exactly for this. As a cloud accounting software, it keeps your sales, purchases, ITC, and tax filings connected and in sync. Your outward supplies are already reconciled with your GSTR 1. Your ITC is matched against GSTR 2B. Your tax liability is tracked in real time. When December comes around, you are not building your data from scratch — it is already there.

There is another side to this that people underestimate. With cloud accounting software, your CA, your accountant, and your internal team are all working off the same live data. No emailing files back and forth. No “which version is correct” confusion. No one working off month-old numbers. For something as collaborative as GSTR 9C preparation — where your accountant needs to see your books and your returns at the same time — this is genuinely useful.

And when it comes to pulling HSN summaries, rate-wise sales data, and ITC breakdowns for GSTR 9C, a proper GST billing software like MargBooks software generates all of that in the format you actually need. Instead of manually compiling data from five different places, you pull a report and you are done.

Steps of Filing GSTR 9C on the Portal 

1. Log in at gst.gov.in
2. Services → Returns → Annual Return → FY 2025-26
3. File GSTR 9 first — GSTR 9C cannot be initiated until GSTR 9 is complete
4. Come back to the Annual Return page and open GSTR 9C
5. Select Prepare Online
6. Work through turnover reconciliation (Tables 5 to 8) — audited turnover first, then adjust, then arrive at GST turnover
7. Tax liability reconciliation (Table 9), then ITC reconciliation (Tables 12 and 13)
8. Any additional liability goes in Table 11 — pay via DRC-03 before submitting
9. Self-certification in Part B
10. Submit via DSC or EVC
11. Save your ARN acknowledgement

If you prefer working in Excel, the GSTN offline utility lets you prepare everything offline and upload a JSON file. A lot of accountants prefer this route for larger reconciliations.

Conclusion

GSTR 9C for FY 2025-26 will require you to report one number – ₹5 crore. If you exceed this on a PAN basis, both GSTR 9 and GSTR 9C will be required to be filed by 31st December 2026.

It is easy enough to file GSTR 9C if all of your records are correct. However, the real challenge lies in everything that you will do prior to filing your GSTR 9C…12 months of data must be pulled together, reconciled and explained and any shortfalls must be paid prior to even attempting to reconcile your books with your GST returns.

Start early and ensure GSTR 1 and GSTR 3B returns are correct and also confirm that your books and your GST returns agree before attempting to reconcile. 

If your current system is making it difficult to do the above tasks; disorganized records, reconciling manually, no real-time visibility over the ITC are just some examples. You may want to consider using a proper GST billing software such as MargBooks. When your billing, accounting and GST Filings are in one location, the GSTR 9C isn’t going to be an year-end emergency, but will simply be another form to file.