(GST & Income Tax Year-End Compliance Guide)

As the financial year 2025–26 comes to an end, 31st March 2026 becomes extremely important for businesses, professionals, exporters, and salaried individuals.

Many options, tax planning opportunities, and compliance decisions must be completed before year-end. Missing these deadlines can lead to higher tax liability, penalties, or loss of benefits.

Here is a complete checklist.

🔵 PART A – INCOME TAX TASKS BEFORE 31 MARCH 2026

1️⃣ Pay Advance Tax (If Applicable)

If total tax liability for FY 2025-26 exceeds ₹10,000:

• Pay final installment of advance tax by 15th March (already due)
• Review if any shortfall remains
• Pay before 31 March to reduce interest under section 234B/234C

2️⃣ Tax Planning & Investments

This is the last opportunity to:

• Invest in 80C (LIC, PPF, ELSS, etc.)
• Pay health insurance for 80D
• Contribute to NPS (80CCD(1B))
• Claim HRA and other exemptions
• Make eligible donations under 80G

Proper planning can significantly reduce tax liability.

3️⃣ TDS Deduction & Deposit Review

Before closing the year:

• Ensure TDS deducted on all applicable payments
• Verify contractor, professional, rent, commission payments
• Deposit TDS within due date

Failure may lead to:

• 40% disallowance of expense
• Interest & penalty

Important for Old TDS Returns:

In view of Section 397(3)(f) of Income Tax Act, 2025, correction statements for FY 2018-19 (Qtr. 4), FY 2019-20 to 2022-23 (Qtr. 1 to Qtr. 4) and FY 2023-24 (Qtr. 1 to Qtr. 3) shall be accepted only up-to 31st March 2026. The same are time barred by limitation on 31.03.2026 and would not be accepted from 01.04.2026 onwards. Deductors,Collectors and other Stakeholders may kindly take note. Click here to view details

4️⃣ TCS Compliance Review

If liable to collect TCS:

• Verify TCS collected properly
• Deposit pending amounts
• Reconcile with books

Important as new TCS rates apply from 1 April 2026.

5️⃣ Capital Gain Planning

Before year-end:

• Plan sale of shares/property
• Book capital losses (tax harvesting)
• Invest in 54, 54F, 54EC bonds
• Deposit in Capital Gain Account Scheme if required

This can help legally reduce capital gains tax.

6️⃣ MSME Payment Compliance (Section 43B(h))

For businesses:

• Ensure MSME dues paid within 45 days
• Otherwise expense will be disallowed in FY 2025-26

Very important for traders and manufacturers.

7️⃣ Close Books & Reconcile Accounts

Before 31 March:

• Bank reconciliation
• Debtors/creditors confirmation
• Physical stock verification
• Cash verification
• Loan reconciliation

This reduces audit and scrutiny risk.

8️⃣ Study Income Tax Act 2025 (Applicable from 1 April 2026)

From next financial year:

• Income-tax Act 2025 will apply
• New Rules 2026 will be notified
• Forms renumbered and simplified

Professionals must:

• Map old vs new provisions
• Update compliance checklists
• Educate clients
• Update systems & software

Preparation in March avoids confusion in April.

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🔵 PART B – GST TASKS BEFORE 31 MARCH 2026

9️⃣ Opt In / Opt Out of Composition Scheme

If eligible:

• File intimation before 31 March
• Check turnover limits
• Ensure compliance for FY 2026-27

Decision must be taken before start of next FY.

🔟 File LUT for FY 2026-27

Exporters must:

• File new LUT before 1 April 2026
• Verify IEC details
• Update DSC

Without LUT, export may attract IGST payment.

1️⃣1️⃣ QRMP Scheme Option

Taxpayers with turnover up to ₹5 crore:

• Opt in or opt out of QRMP
• Must choose before 30 April (but plan before 31 March)

Turnover review is essential.

1️⃣2️⃣ GTA Opt In / Opt Out (FCM vs RCM)

Goods Transport Agency must:

• File Annexure V or Annexure VI
• Decide between Forward Charge or Reverse Charge

Option must be exercised within prescribed timeline.

1️⃣3️⃣ Hotels – Declare Specified Premises

Hotels must:

• File Annexure VII
• Declare specified premises for rate determination

This impacts GST rate for next financial year.

1️⃣4️⃣ GST ITC Reconciliation

Before year-end:

• Reconcile books vs GSTR-2B
• Match GSTR-1 with 3B
• Reverse ineligible ITC
• Follow up with vendors

March is ideal time to clean mismatches.

1️⃣5️⃣ RCM Liability Review

Check whether:

• GTA services
• Legal services
• Director remuneration
• Other notified services

RCM properly paid and reported in 3B.

1️⃣6️⃣ E-Invoicing Threshold Check

If turnover crossed threshold:

• Ensure e-invoicing started from 1 April
• Update ERP
• Generate IRN properly

Non-compliance attracts heavy penalties.

1️⃣7️⃣ Turnover Review for Next FY

Check aggregate turnover:

• Crossed ₹1.5 crore? Composition not allowed
• Crossed ₹5 crore? QRMP not allowed
• Crossed audit limits? Audit applicable

Year-end review helps proper planning.

1️⃣8️⃣ Update GST Registration Details

Before year-end:

• Update bank details
• Address changes
• Additional place of business
• Authorized signatory

Avoid future notices.

1️⃣9️⃣ Check Refund Position (If Exporter)

• File pending refund claims
• Review inverted duty structure claims
• Ensure documentation ready

2️⃣0️⃣ Clean Compliance Records

Before year closes:

• File pending returns
• Clear late fees
• Respond to notices
• Maintain proper documentation

Clean compliance record reduces risk under new regime.

31st March 2026 is not just financial year end — it is:

✔ Last date for tax planning
✔ Decision date for GST options
✔ Compliance correction opportunity
✔ Preparation time for Income Tax Act 2025

If these steps are ignored, it may result in:

• Higher tax
• Interest & penalties
• Loss of benefits
• Compliance burden in next year

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