FinTech Glossary

What is GSTR-4

GSTR-4 is the annual return used by taxpayers covered by the GST composition scheme. It brings together the financial year's turnover, inward supplies, tax liability and payments already reported through quarterly CMP-08 statements. Since the return covers the full financial year, composition taxpayers need to reconcile the quarterly figures before submitting it.

The filing cycle has changed over time. GSTR-4 was originally a quarterly return, but from FY 2019-20 onward it became an annual return. Composition taxpayers now report and pay self-assessed tax quarterly through CMP-08 and file GSTR-4 once for the financial year.

Who Needs to File GSTR-4

A taxpayer must generally file GSTR-4 if the composition scheme applied at any point during the relevant financial year. This includes taxpayers who:

• Remained under the composition scheme throughout the year.
• Entered the composition scheme before or during the financial year.
• Opted out of the scheme during the year after using it for part of the period.
• Fall within the prescribed concessional scheme for eligible service providers covered by the applicable GST rules.

A taxpayer who moved out of the composition scheme during the year may therefore still have a GSTR-4 obligation for the period during which composition taxation applied.

Regular taxpayers who were never under the composition scheme during that financial year do not file this return. The requirement also does not apply to categories such as non-resident taxable persons, Input Service Distributors, casual taxable persons, OIDAR taxpayers, TDS deductors, TCS collectors and UIN holders.

GSTR-4 Due Date

The current GSTR 4 due date is 30 June following the end of the financial year for returns relating to FY 2024-25 onward.

For example, GSTR-4 for FY 2025-26 is ordinarily due by 30 June 2026.

This is a relatively recent change. Up to FY 2023-24, the standard deadline was 30 April following the end of the financial year. The GST rules were amended so that taxpayers receive two additional months from FY 2024-25 onward.

The GST composition annual return due date should still be checked for any period-specific extension announced by the government. An extension applies only when formally granted for the relevant financial year or taxpayer category.

GSTR-4 should also not be confused with GSTR-9. Both may be described broadly as a GSTR annual return, but they apply to different taxpayer categories and have different reporting structures.

Details Required in GSTR-4

Preparing GSTR-4 requires information from the taxpayer's books, purchase records and quarterly CMP-08 filings.

The principal sections cover:

• Taxpayer identification and basic registration information.
• Inward supplies received from registered suppliers.
• Inward supplies received from unregistered suppliers where reporting is applicable.
• Supplies attracting tax under reverse charge.
• Import of services, where relevant.
• Turnover and outward supplies for the financial year.
• Tax liability according to the applicable composition rate.
• Tax already paid through CMP-08 during the four quarters.
• Interest and late fee payable, where applicable.
• TDS or TCS credit available during the year.

The portal also provides auto-drafted information for certain inward supplies based on data reported by suppliers. CMP-08 figures for the year can be viewed within GSTR-4, while TDS and TCS credits are also made available in the relevant section.

Before filing, businesses should reconcile turnover in their books with quarterly CMP-08 declarations. Purchase details, reverse-charge transactions and tax payments should also be checked for missing or incorrectly classified entries.

Step-by-Step GSTR-4 Filing Process

GSTR-4 can be filed electronically through the GST portal. Taxpayers with larger datasets can prepare specified portions using the offline utility, but final filing takes place online.

A practical filing sequence is:

1. Log in to the GST portal using the registered credentials.
2. Open Services, choose Returns, and access the annual return section.
3. Select the relevant financial year and locate Form GSTR-4.
4. Review the auto-populated information available on the portal.
5. Enter the required inward-supply and turnover information.
6. Check the CMP-08 figures already reported for each quarter.
7. Calculate any additional tax, interest or late fee payable.
8. Compare the completed return with the accounting records.
9. Preview the draft before proceeding with submission.
10. Pay any remaining liability through the electronic cash ledger.
11. File the return using the permitted authentication method.
12. Save the acknowledgment and filed return for future reference.

A nil GSTR-4 may be filed when the taxpayer meets the portal conditions for nil filing, including the absence of relevant outward supplies, inward supplies and tax liability for the year.

Late Fees for GSTR-4

Late fees for GSTR4 apply when the annual return is filed after its prescribed deadline.

For FY 2021-22 onward, the maximum combined late fee is:

It is ₹250 under central tax and an equivalent ₹250 under the corresponding state or union territory tax for a nil return. For other taxpayers, the central component is capped at ₹1,000, with the corresponding state or union territory component taking the combined maximum to ₹2,000.

A composition taxpayer should complete the annual reconciliation before the filing deadline rather than treating GSTR-4 as a simple year-end formality. Matching turnover, CMP-08 payments and inward-supply records before submission reduces the chance of carrying an incorrect annual position into later GST compliance.