How to choose GST return filing software: a 30-point checklist for Indian small businesses
A practical checklist for choosing GST and accounting software in India covering returns, IMS and GSTR-2B reconciliation, e-invoicing, audit trail, data export, security, support and contract terms.
Choose GST software by checking, in this order: does it produce correct returns for your registration type (GSTR-1/IFF/1A, GSTR-3B, CMP-08, GSTR-9), does it reconcile ITC with IMS and GSTR-2B well, does it handle e-invoices and e-way bills if you need them, and only then price, ease of use and extras. Equally important are the things people forget until later: data export, audit trail, user controls and the renewal price. The checklist below is designed to be used in a demo or free trial with your own data.
This guide is part of the GST calculation worked examples section. We describe features generically and do not rate or rank named products. Reconciliation features are tested best against the routine in ITC reconciliation with GSTR-2B and the monthly GST filing checklist.
Before you look at any product
Write down:
- Your registration type (regular monthly, QRMP or composition) and number of GSTINs.
- Monthly counts of sales invoices, purchase invoices, credit/debit notes and e-invoices.
- Whether you hold inventory, have branches, export, buy under reverse charge or import services.
- Who will use the software (owner, staff, CA) and from where.
- Whether you are a company (audit trail rules apply) or a proprietorship/firm.
This sets the minimum features and stops you paying for modules you do not need.
The checklist
Returns and compliance
| # | Check | Why it matters |
|---|---|---|
| 1 | Generates GSTR-1 (and IFF for QRMP) with correct B2B, B2CL, B2CS, exports, credit notes | Errors here flow to buyers and lock your GSTR-3B |
| 2 | Prepares GSTR-1A amendments | The only way to fix liability before GSTR-3B since 2025 |
| 3 | HSN/SAC summary for GSTR-1 Table 12 with B2B/B2C split | Mandatory reporting validations |
| 4 | Drafts GSTR-3B from books and GSTR-2B, showing differences | Lets you see mismatches before filing |
| 5 | Handles composition (bills of supply, CMP-08, GSTR-4) if relevant | Composition dealers need different documents |
| 6 | Supports GSTR-9 and, if needed, GSTR-9C working papers | Year-end without re-keying |
| 7 | Applies current GST rates by HSN/SAC with date history (pre/post 22 September 2025) | Rate changes need correct time-of-supply handling |
| 8 | Reverse charge and import of services entries | Cash-only tax that is easy to miss |
ITC reconciliation
| # | Check | Why it matters |
|---|---|---|
| 9 | Imports IMS data and lets you accept/reject/pending in bulk | IMS action decides GSTR-2B |
| 10 | Matches purchases with GSTR-2B by GSTIN, invoice number, date and value, with fuzzy matching | Supplier typos are common |
| 11 | Flags blocked credits by ledger or item | Section 17(5) errors are a classic notice trigger |
| 12 | Tracks 180-day payment ageing and reversal/reclaim | Rule 37 compliance |
| 13 | Warns before the section 16(4) deadline (30 November) | Lost credit cannot be recovered |
| 14 | Supplier follow-up reports or emails | Saves hours each month |
E-invoicing and e-way bills (if applicable)
| # | Check | Why it matters |
|---|---|---|
| 15 | Generates IRN and QR code from the invoice screen | No double entry |
| 16 | Warns about the 30-day reporting window | Rejections cannot be undone |
| 17 | Generates e-way bills from invoices and tracks validity | Goods held in transit cost money |
| 18 | Clear pricing for IRN/e-way bill volumes | Overage surprises |
Records, control and security
| # | Check | Why it matters |
|---|---|---|
| 19 | Audit trail (edit log) that cannot be disabled, for companies | Companies (Accounts) Rules requirement since April 2023 |
| 20 | User-level rights (entry, approval, filing) | Separation of duties |
| 21 | Two-factor login and activity log | Protects tax data and portal access |
| 22 | Where data is stored, backup frequency, and whether you can keep your own backup | Records must be kept for years |
| 23 | Free export of all data in an open format (spreadsheet/CSV/JSON) | You can leave without losing history |
| 24 | How the software connects to GSTN (GSP) and whether it stores your portal password | Credential risk |
Usability, support and contract
| # | Check | Why it matters |
|---|---|---|
| 25 | Works for your staff's language and skill level; mobile access if needed | Adoption |
| 26 | Support hours near due dates (11th, 13th, 20th, 22nd/24th) | When you will need it |
| 27 | Accountant access (free or paid) | Your CA's time is cheaper with direct access |
| 28 | First-year vs renewal price in writing | Promotional pricing is common |
| 29 | Cancellation terms and refund policy | Lock-in risk |
| 30 | Tax invoice in your GSTIN for the subscription | So you can claim ITC |
Run a real test
Ask for a trial and run one past month through it: enter or import last month's sales and purchases, download your actual GSTR-2B, and see whether the software's GSTR-3B draft matches what you (or your CA) filed. Note how many manual corrections were needed and how long it took. That single test tells you more than any feature list.
Scoring tip. Mark each line as must have, nice to have or not needed before the demo, then score only the must-haves. A product that misses one must-have is out regardless of price.
Does it pay for itself?
Once you have a shortlist, compare the yearly cost with what it saves: fewer professional hours, less staff time, fewer late fees. Use the software payback calculator and see what GST compliance costs in a year for typical components. The pricing models guide helps you convert quotes into comparable yearly figures.
If you are moving from existing software, read switching accounting software without losing records before you sign.
Frequently asked questions
Is cloud software safe for tax data?
It can be, if it offers two-factor login, encryption, user rights and backups, and if you keep your own periodic export. Ask the provider where data is stored and how breaches are notified.
Do I need software approved by GSTN?
GSTN does not approve accounting software as such. It approves GST Suvidha Providers (GSPs) that connect software to the GST system. Ask which GSP the software uses.
Can one software handle both GST and income tax?
Accounting software can produce the books and reports used for the income-tax return, but the return itself is filed on the Income Tax Department's e-filing portal, often by your CA.
How long should a trial be?
Long enough to cover one full filing cycle, ideally a month that includes a GSTR-1 and GSTR-3B due date.
Sources
- GST portal — GST Suvidha Providers, IMS, GSTR-2B
- CBIC GST — sections 16, 17 and 36 of the CGST Act
- Ministry of Corporate Affairs — Companies (Accounts) Rules, 2014 on audit trail
