The Goods and Services Tax (GST) regime in India requires businesses to report transactions regularly through prescribed returns. Among these, GSTR-1 is the most important return for outward supplies (sales), as it directly affects both the supplier’s tax liability and the recipient’s ability to claim Input Tax Credit (ITC).

For Indian businesses, timely and accurate GSTR-1 filing is essential to remain compliant, avoid penalties, and support healthy vendor and customer relationships. For foreign companies and subsidiaries operating in India, GSTR-1 carries even greater significance, as cross-border operations and complex supply chains increase compliance risks.

This guide provides a comprehensive breakdown of GSTR-1 filing, from eligibility and due dates to the filing process, penalties, best practices, and compliance considerations for international businesses.

What Is GSTR-1?

GSTR-1 is a GST return that reports all outward supplies of goods and services made by a registered taxpayer during a tax period. It captures invoice-wise details of sales, debit/credit notes, export transactions, and advance adjustments.

Why GSTR-1 Filing Matters

  • Foundation of GST compliance: All subsequent returns (including GSTR-3B) depend on accurate GSTR-1 data.
  • Enables ITC claims: Buyers rely on your GSTR-1 to claim input tax credit. Incorrect filing affects them directly.
  • Builds compliance credibility: Accurate and timely returns reduce the risk of audits, disputes, and vendor dissatisfaction.
  • Mandatory under law: Non-filing attracts penalties, late fees, and compliance restrictions.

Eligibility for GSTR-1 Filing

Who Must File

  • All regular GST-registered taxpayers making outward supplies.
  • Businesses under the QRMP scheme (Quarterly Return, Monthly Payment) must file GSTR-1 quarterly.
  • Even if there are no outward supplies, a nil return is required.

Who Is Exempt

  • Composition scheme taxpayers.
  • Input Service Distributors (ISDs).
  • Non-resident taxable persons.
  • Persons liable for TDS or TCS.
  • Some OIDAR service providers (when paying tax directly).

Due Dates & Frequency

  • Monthly filing: For taxpayers with turnover above ₹5 crore. Due date: 11th of the following month.
  • Quarterly filing: For taxpayers under the QRMP scheme (turnover ≤ ₹5 crore). Due date: 13th of the month after the quarter.
  • Nil return: Required even with no outward supplies.

Structure & Format of GSTR-1

GSTR-1 has multiple tables to capture details across transaction categories:

  1. B2B Supplies: Invoice-wise details of supplies to registered persons.
  2. B2C Large: Outward supplies to unregistered persons (invoice value > ₹2.5 lakh interstate).
  3. B2C Others: Small-value supplies to unregistered persons.
  4. Exports & SEZ Supplies: Zero-rated supplies requiring invoice/shipping bill details.
  5. Nil/Exempt/Non-GST Supplies.
  6. Credit/Debit Notes: To registered and unregistered persons.
  7. Advances & Adjustments: Advances received and adjusted against supplies.
  8. HSN Summary: HSN-wise breakdown of outward supplies.
  9. Documents Issued: Invoices, debit notes, credit notes summary.

Step-by-Step Filing Process

Step 1: Prepare Data

  • Collect sales invoices, export documents, debit/credit notes, advance receipts, and adjustments.
  • Ensure data in the accounting system matches the GST-compliant invoice format.

Step 2: Access GST Portal

  • Log into the GST portal.
  • Navigate to Returns Dashboard → GSTR-1.

Step 3: Select Filing Mode

  • Online preparation: Enter details manually.
  • Offline preparation: Upload bulk data through JSON file using the offline utility.

Step 4: Enter Transaction Data

  • Fill in all relevant tables (B2B, B2C, exports, SEZ, exempt, nil, credit/debit notes).
  • Enter HSN summary and document details.

Step 5: Validate & Preview

  • Use portal’s validation checks.
  • Preview draft summary for accuracy.

Step 6: Submit Return

  • Submit using DSC (Digital Signature Certificate) or EVC (Electronic Verification Code).

Step 7: Download Acknowledgement

  • Save ARN (Acknowledgement Reference Number).
  • Maintain records for audit and reconciliation.

Penalties & Consequences of Non-Compliance

  1. Late Fees: ₹50/day (₹25 CGST + ₹25 SGST) for regular returns; ₹20/day for nil returns.
  2. Interest: 18% per annum on unpaid liability.
  3. Blocked filings: Non-filing of GSTR-1 may prevent GSTR-3B submission.
  4. Buyer ITC loss: Incorrect or delayed GSTR-1 filing can block your buyers from claiming ITC.
  5. Audit and scrutiny: Frequent errors increase the likelihood of audit notices.

Common Mistakes in GSTR-1 Filing

  • Entering wrong GSTIN for B2B invoices.
  • Omitting credit/debit notes or advance adjustments.
  • Incorrectly classifying exports or SEZ supplies.
  • Not filing nil return when no transactions occur.
  • Using wrong HSN codes (now mandatory to select from portal dropdowns).
  • Filing without reconciliation with accounting books.

Best Practices for Compliance

  • Reconcile monthly between books and GSTR-1 before filing.
  • Automate data entry with GST-compliant accounting tools.
  • File early to avoid last-day errors and server overloads.
  • Track amendments and use correct tables for corrections.
  • Maintain HSN summaries updated with correct codes.
  • Train staff handling sales invoices and GST entries.
  • Back up documents for at least six years.

Special Section: Foreign Businesses & Subsidiaries in India

Foreign companies with subsidiaries or branches in India must also comply with GSTR-1 filing requirements if registered under GST.

Applicability

  • Any foreign company with GST registration for operations in India (subsidiary, branch, or liaison office engaged in taxable supplies).
  • Imports, exports, and inter-company transactions are reportable in GSTR-1.

Compliance Considerations

  1. Separate GST Registration: Each state where the subsidiary operates may require a distinct GSTIN.
  2. Export & Zero-Rated Supplies: Supplies made outside India or to SEZs must be reported under export tables in GSTR-1 with invoice and shipping bill details.
  3. Transfer Pricing Alignment: Intra-group supplies between Indian subsidiaries and parent companies must comply with GST invoicing rules.
  4. Foreign Currency Transactions: Conversion into INR as per GST law requirements must be reflected accurately in GSTR-1.
  5. Documentation: Foreign entities are often audited more closely. Maintain a robust trail of contracts, invoices, and reconciliation reports.
  6. Subsidiary Controls: Global parent companies should implement governance policies ensuring subsidiaries in India follow GSTR-1 timelines and compliance rules.
  7. QRMP Scheme Eligibility: Subsidiaries with smaller turnovers can opt for quarterly filing, but parent companies should monitor consistency across all Indian entities.

Risks of Non-Compliance for Foreign Entities

  • Higher risk of penalties and scrutiny due to complex structures.
  • Possible restrictions on ITC claims of Indian customers.
  • Negative impact on cross-border credibility if compliance lapses are detected.

Best Practices for Foreign Companies

  • Use a centralized compliance dashboard to monitor Indian subsidiary filings.
  • Appoint local tax professionals to manage GSTR-1 filings and reconciliations.
  • Conduct quarterly compliance reviews at group level.
  • Integrate accounting systems of Indian entities with global ERP for consistency.

How Technology Platforms Support GSTR-1 Compliance

Platforms like Commenda help both domestic and foreign businesses by:

  • Automating reconciliation between invoices and GSTR-1 data.
  • Providing multi-entity dashboards for group compliance.
  • Offering automated alerts for due dates.
  • Centralizing document storage for audits.
  • Supporting complex needs of foreign subsidiaries, including cross-border reporting and audit readiness.

Book a demo with Commenda to simplify compliance across India and international operations.

Conclusion

GSTR-1 is a cornerstone of GST compliance in India. It ensures accurate reporting of outward supplies, supports ITC for customers, and builds trust with regulators. For domestic businesses, timely filing reduces compliance risks and avoids penalties. For foreign companies and subsidiaries, GSTR-1 is even more critical, given the added complexity of cross-border operations, multiple GST registrations, and higher audit risks.

By following the step-by-step filing process, avoiding common mistakes, implementing best practices, and leveraging compliance technology such as Commenda, businesses can streamline their GST compliance in India and globally.

GSTR-1 is more than a return, it is a reflection of your company’s governance and credibility.

FAQs on GSTR-1 Filing

What is GSTR-1?
It is the GST return for outward supplies (sales) filed by registered taxpayers.

Who needs to file GSTR-1?
All regular GST-registered taxpayers, including foreign subsidiaries, must file.

What is the due date?
11th of next month (monthly filers) or 13th after quarter (quarterly filers).

Is nil filing mandatory?
Yes, a nil return is required even if there are no outward supplies.

Can GSTR-1 be revised?
No, errors must be corrected in subsequent periods.

What penalties apply for late filing?
₹50/day (₹25 CGST + ₹25 SGST) for regular returns; ₹20/day for nil returns.

How long must records be retained?
At least six years.

Does GSTR-1 affect ITC claims?
Yes, buyers’ ITC depends on suppliers filing GSTR-1 correctly.

Can foreign subsidiaries file quarterly?
Yes, if turnover is ≤ ₹5 crore and they opt for QRMP scheme.

Are exports reported in GSTR-1?
Yes, exports and SEZ supplies are zero-rated and reported under special tables.

How are foreign currency invoices handled?
They must be converted into INR as per GST law when reporting in GSTR-1.

What happens if GSTR-1 is not filed?
Late fees, blocked GSTR-3B filing, ITC denial to buyers, and possible scrutiny.

Can invoices be uploaded in bulk?
Yes, using the offline utility and JSON file upload.

What is the HSN requirement?
HSN codes must be reported using the GST portal’s dropdown menus.