GSTR-4 is the annual return that GST composition dealers under Section 10 must file, in addition to the quarterly CMP-08 challan used to pay tax. It summarises the year’s turnover and tax; the due date is 30 June after the end of the financial year (from FY 2024-25), and a late fee applies if you miss it.
The GSTR-4 serves as the annual return for taxpayers registered under the GST composition scheme in India. Previously, quarterly filings were required before FY 2018-19; the annual filing requirement was introduced alongside Form CMP-08 for quarterly statements. This guide covers every aspect of GSTR-4, including its applicability, turnover criteria, filing deadlines, penalties for delayed submission, and recent changes that restrict filing beyond three years from the original due date.
Understanding GSTR-4 and the Composition Scheme
GSTR-4 is the annual Goods and Services Tax return designed specifically for dealers who have opted into the composition scheme. The composition scheme offers a simplified compliance framework for small businesses, allowing them to pay GST at a fixed percentage of their turnover rather than at standard rates. This scheme significantly reduces the compliance burden by requiring fewer return filings and less detailed record-keeping compared to the regular GST registration.
Under the current framework, composition dealers are required to file Form CMP-08 quarterly and GSTR-4 annually. This is considerably simpler than the regular GST scheme, which requires taxpayers to file two monthly returns and one annual return. The annual GSTR-4 consolidates all the information previously declared in the quarterly CMP-08 filings, providing a comprehensive summary of the taxpayer’s activities for the entire financial year.
It is important to note that once GSTR-4 has been filed on the GST portal, it cannot be revised or amended. This makes it essential for composition dealers to verify all figures thoroughly before submission. Any errors discovered after filing must be addressed through alternative mechanisms, such as subsequent-period adjustments or voluntary payments using Form DRC-03.
GSTR-4 Filing Deadline and Recent Changes
The official deadline for filing GSTR-4 is June 30 of the year following the relevant financial year. For example, the GSTR-4 for FY 2024-25 must be filed by June 30, 2025. This revised deadline was established through CGST Notification 12/2024, issued on July 10, 2024. Prior to FY 2018-19, when GSTR-4 was filed quarterly, the deadline was the 18th day of the month following each quarter.
A significant recent development affects taxpayers who have pending GSTR-4 filings from earlier years. As of June 7, 2025, the GSTN imposed a restriction preventing taxpayers from filing GSTR-4 if more than three years have elapsed since its original due date. This restriction is being enforced on the GST portal starting from the July 2025 tax period, as confirmed by an official GSTN advisory. Composition dealers with outstanding returns from prior years should prioritise clearing these filings before the three-year window closes.
The three-year filing restriction has important practical implications. For instance, if a taxpayer missed filing GSTR-4 for FY 2020-21 (due date June 30, 2021), they would no longer be able to file this return after June 30, 2024. Taxpayers who have been unable to file due to technical issues, disputes, or other reasons should act promptly to complete any pending filings within the permissible window to avoid permanent non-compliance on their GST record.
Eligibility and Turnover Criteria for GSTR-4
GSTR-4 is mandatory for all taxpayers enrolled under the composition scheme. There is no separate turnover threshold for filing GSTR-4; if a business is registered under the composition scheme, filing the annual return is compulsory. The eligibility requirement also extends to service providers who qualify for the special composition scheme, introduced by CGST (Rate) Notification Number 2/2019, effective from FY 2019-20.
The turnover thresholds for the composition scheme determine who can opt in and, consequently, who must file GSTR-4. The following criteria apply:
- Manufacturers, Traders, and Restaurants – Annual turnover up to Rs 1.5 crore in most states, or Rs 75 lakh in designated special category states. Restaurants serving alcohol are excluded from this scheme.
- Service Providers – Annual turnover up to Rs 50 lakh under the special composition scheme introduced from FY 2019-20 onwards.
- Intra-state Supplies Only – The composition scheme is designed for businesses primarily engaged in intra-state supplies. Taxpayers making interstate supplies are generally not eligible for this scheme.
- No E-commerce Sales – Businesses supplying goods or services through e-commerce operators are not permitted to opt for the composition scheme.
Businesses under the composition scheme cannot collect GST from their customers or claim Input Tax Credit on their purchases. Instead, they pay tax at a fixed rate on their turnover – typically 1% for manufacturers and traders, 5% for restaurants, and 6% for service providers under the special scheme. This simplified approach reduces administrative overhead but limits the financial flexibility available to regular taxpayers.
Key Information Required in GSTR-4
GSTR-4 requires composition dealers to provide a comprehensive summary of their business activities for the financial year. Understanding the structure of this return helps ensure complete and accurate reporting.
| Section | Details Required |
| Basic Details | GSTIN, legal name, trade name, and the period covered by the return |
| Outward Supplies | Summary of all taxable supplies made during the year, including supply values and tax paid |
| Inward Supplies | Details of inward supplies attracting reverse charge, including those from unregistered suppliers |
| Tax Payment | Tax paid during the year under IGST, CGST, SGST/UTGST, and Cess heads |
| Amendments | Corrections to information reported in quarterly CMP-08 filings during the year |
| Interest and Late Fee | Any interest or late fee paid during the year for delayed filings or payments. |
The data reported in GSTR-4 must align with the quarterly CMP-08 statements filed throughout the year. Composition dealers should reconcile their sales and purchase registers and bank statements with their quarterly filings before preparing the annual return. Any discrepancies between the quarterly filings and the annual return should be properly reported and addressed through the amendments section.
Penalties for Delayed GSTR-4 Filing
Failure to file GSTR-4 by the deadline attracts late fees and penalties that accumulate for each day of delay. Under the current regulations, the penalty structure for delayed GSTR-4 filing is as follows:
- Standard Late Fee – Rs 50 per day of delay (Rs 25 CGST + Rs 25 SGST/UTGST), subject to a maximum cap of Rs 2,000.
- Nil Tax Liability – If there is no tax liability for the period, the maximum late fee is capped at Rs 500.
- Previous Penalty Structure – Before the current revision, the late fee was Rs 200 per day, with a maximum of Rs 5,000. The reduction in penalties reflects the government’s effort to ease the compliance burden on small businesses.
Beyond the direct financial penalties, delayed filing can have broader consequences for composition dealers. Persistent non-compliance may result in cancellation of the GST registration, forcing the business to register under the regular scheme with significantly higher compliance requirements. Additionally, non-filing of returns can block the generation of e-way bills, disrupting the movement of goods and affecting business operations.
Composition dealers should set up reminders well before the June 30 deadline and ensure that all quarterly CMP-08 filings are up to date before preparing the annual GSTR-4. Maintaining organised records throughout the year simplifies the annual filing process and helps avoid last-minute errors that could lead to notices from the tax department.
Transition from Quarterly to Annual Filing
The shift from quarterly GSTR-4 filing to an annual format simplified the process for composition dealers. Before FY 2018-19, composition taxpayers were required to file GSTR-4 every quarter, resulting in 4 filings per year with detailed information on inward and outward supplies. The transition to annual filing, combined with the simpler quarterly CMP-08 statement, substantially reduced overall compliance effort.
Form CMP-08 requires only a summary of self-assessed tax liability for each quarter, making it considerably easier to complete than the earlier quarterly GSTR-4. The annual GSTR-4 then serves as the comprehensive reconciliation document that brings together all quarterly data along with any amendments or corrections needed for the full financial year.
The small business community has broadly welcomed this restructuring. The reduced frequency of detailed filings means composition dealers can focus more on their business operations while still meeting their compliance obligations. However, the annual nature of GSTR-4 means that any errors in quarterly CMP-08 filings accumulate over the year and must be addressed comprehensively at the time of annual filing, requiring careful record-keeping throughout the financial year.
| Disclaimer: This article is for informational purposes only and does not constitute legal or tax advice. GST provisions, deadlines, and penalties are subject to changes by the GST Council and CBIC notifications. Consult a qualified tax professional for advice specific to your situation. |
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Frequently Asked Questions
Q1: What is the main benefit of opting for the GST composition scheme?
The primary benefit of the GST composition scheme is simplified tax compliance, including lower tax rates, fewer return filings (quarterly CMP-08 and annual GSTR-4), and reduced paperwork compared to the regular GST scheme.
Q2: How does the composition scheme differ for service providers versus manufacturers and traders?
The composition scheme for service providers has a lower annual turnover limit of Rs 50 lakh, compared to Rs 1.5 crore (or Rs 75 lakh in special category states) for manufacturers and traders. Service providers also pay a 6% turnover tax, while manufacturers and traders pay 1%, and restaurants pay 5%.
Q3: Are businesses under the composition scheme allowed to collect GST from their customers?
No, businesses registered under the GST composition scheme are not permitted to collect GST from their customers or claim Input Tax Credit (ITC) on their purchases. They pay tax out of their own pocket at a fixed rate on their turnover.
Q4: Can a taxpayer switch from the regular GST scheme to the composition scheme during a financial year?
Generally, a taxpayer can opt for the composition scheme only at the beginning of a financial year. Switching during an ongoing financial year is usually not permitted, except under specific circumstances or notifications issued by the GST Council.
Q5: What are the disadvantages of choosing the GST composition scheme?
Key disadvantages include the inability to claim Input Tax Credit, restrictions on making inter-state supplies, the inability to supply goods or services through e-commerce operators, and limited market reach due to the inability to issue tax invoices to customers.
Q6: What happens if GSTR-4 is not filed within three years of its due date?
From July 2025, the GST portal will prevent taxpayers from filing GSTR-4 if more than three years have passed since its original due date. This means composition dealers with pending returns from prior years must file them before the three-year window closes, or they will permanently lose the ability to file those returns.
Frequently Asked Questions (FAQ)
Who has to file GSTR-4?
GSTR-4 must be filed by taxpayers registered under the GST composition scheme (Section 10), including composition service providers under Section 10(2A).
What is the due date for GSTR-4?
From FY 2024-25 the annual GSTR-4 is due by 30 June following the end of the financial year; earlier it was due by 30 April.
What is the difference between GSTR-4 and CMP-08?
CMP-08 is a quarterly challan-cum-statement to pay tax, while GSTR-4 is the annual return that consolidates the year’s turnover and tax details.
What is the penalty for filing GSTR-4 late?
A late fee is charged for delayed filing of GSTR-4, subject to the maximum limits notified by the government.
