GST late fee and interest calculation: GSTR-3B, GSTR-1 and GSTR-9 with worked examples

A late GSTR-3B or GSTR-1 costs ₹50 a day (₹25 CGST + ₹25 SGST) when there is tax or supplies to report, or ₹20 a day for a nil return, up to a cap of ₹500 (nil), ₹2,000 (previous-year turnover up to ₹1.5 crore), ₹5,000 (₹1.5–5 crore) or ₹10,000 (above ₹5 crore). On top of that, interest at 18% a year runs on any tax paid late in cash, from the day after the due date to the date of payment. A late GSTR-9 has its own per-day fee and cap based on turnover. This guide shows how to calculate each, with worked examples.

It is part of the GST calculation worked examples section; the annual return is covered in the GSTR-9 guide and the routine that prevents delays in the monthly GST filing checklist. Figures are illustrative; late fee notifications and waivers change, so confirm on the GST portal.

Late fee for GSTR-3B and GSTR-1

The base fee is set by section 47 of the CGST Act and is reduced and capped by notifications issued in 2021. The structure in force is:

The late fee runs from the day after the due date up to the date of filing. It is charged per return, so a business late on both GSTR-1 and GSTR-3B pays both. There is no late fee under the IGST Act for these returns.

Worked example 1 (illustrative). A Nagpur service firm with ₹80 lakh turnover files its September GSTR-3B (due 20 October) on 24 November: 35 days late. Late fee = 35 × ₹50 = ₹1,750, below the ₹2,000 cap. If it had filed on 31 December (72 days late), 72 × ₹50 = ₹3,600, capped at ₹2,000.

Worked example 2 (illustrative). A dormant firm forgets a nil GSTR-3B and files 40 days late: 40 × ₹20 = ₹800, capped at ₹500.

Interest under section 50

Interest is charged at 18% a year on tax that is paid late, calculated on the net tax paid in cash for returns filed late (after the Finance Act, 2021 amendment, effective retrospectively from 1 July 2017). Interest on ITC wrongly availed and utilised is charged under section 50(3); check the currently notified rate with your adviser.

Formula: Interest = cash tax × 18% × days late ÷ 365.

Worked example 3 (illustrative). The Nagpur firm's September GSTR-3B shows ₹62,000 of tax payable in cash, paid with the return on 24 November (35 days late):

• Interest = ₹62,000 × 18% × 35 ÷ 365 = ₹1,070 (rounded)
• Late fee = ₹1,750
• Total cost of the delay = ₹2,820

GSTR-3B now calculates interest automatically for late filing and shows it in Table 5.1; check the figure, especially if you paid part of the tax through a challan before filing, because tax lying in the cash ledger before the due date generally does not attract interest.

Late fee for GSTR-9 (annual return)

From FY 2022-23 onwards the late fee for GSTR-9 is rationalised by turnover (Notification 7/2023-Central Tax). The amounts below are CGST + SGST together:

Remember that taxpayers with turnover up to ₹2 crore are exempt from GSTR-9 from FY 2024-25 onwards, so the first slab mostly affects businesses between ₹2 and ₹5 crore.

Worked example 4 (illustrative). A Chennai manufacturer with ₹3.5 crore turnover files GSTR-9 for FY 2025-26 (due 31 December 2026) on 15 February 2027: 46 days late. Late fee = 46 × ₹50 = ₹2,300. Cap = 0.04% × ₹3.5 crore = ₹14,000. Payable: ₹2,300. A further delay of a year would hit the ₹14,000 cap.

Late fee for composition returns

For GSTR-4 the late fee is generally ₹50 a day, capped at ₹2,000, or ₹500 where the tax payable is nil (CGST + SGST together, under the 2021 notifications). CMP-08 paid late attracts interest. Confirm current amounts on the portal.

How to reduce or avoid late fees

1. File nil returns on time, by SMS if needed. Nil late fees are the most avoidable.
2. File even if you cannot pay. Since GSTR-3B usually cannot be filed without paying, pay what you can through PMT-06 early, then file; interest runs only on what is unpaid.
3. Under QRMP, use the fixed-sum method for months 1 and 2 to avoid interest if your cash flow is tight. See QRMP explained.
4. Watch for waivers. The government has issued late fee amnesty notifications in the past. The 57th GST Council meeting (8 October 2026) recommended waiving the late fee for taxpayers up to ₹5 crore who file a return under section 39(1) by the end of the month in which it was due. Until notified, the current fee applies.
5. Use the GST late fee calculator to see the cost before deciding whether to file today or tomorrow: each day adds ₹50 until the cap.

Bigger costs of filing late

Late fees are small compared with what continued non-filing does:

• E-way bill blocking after missed returns.
• Customers losing ITC on your invoices if GSTR-1 is late, and reconsidering you as a supplier.
• Suspension and cancellation of registration. See registration cancellation for non-filing.
• The three-year bar: a return pending for more than three years after its due date can no longer be filed at all.

Frequently asked questions

Can late fee be paid from ITC?

No. Late fees and interest must be paid from the electronic cash ledger.

Is late fee charged for each month of a quarter under QRMP?

Late fee applies to the quarterly return when filed late. Missing a PMT-06 payment does not create a late fee, but interest may apply under the self-assessment method.

Is the interest calculated from the due date or from the end of the month?

From the day after the due date of the return to the date the tax is debited from the cash ledger.

Does a late fee waiver also waive interest?

Usually not. Waiver notifications typically cover the late fee only. Read the notification itself.

Sources

• CBIC GST — sections 47 and 50 of the CGST Act; late fee notifications of 2021 and Notification 7/2023-Central Tax
• GST portal — interest computed in GSTR-3B, due date advisories
• GST Council — 57th meeting recommendation on late fee waiver