Difference Between GSTR 1 and GSTR 3B

Difference Between GSTR 1 and GSTR 3B. In India, businesses are required to file multiple tax returns periodically to ensure transparency and accuracy in tax reporting. Among the most crucial filings are GSTR 1 and GSTR 3B, which serve distinct purposes in the GST system. Understanding the difference between GSTR 1 and GSTR 3B is essential for businesses to ensure timely and accurate compliance, avoiding penalties and discrepancies in tax records.
Both GSTR 1 and GSTR 3B play a significant role in the GST framework, but they differ in terms of purpose, frequency, and the information they contain. While GSTR 1 provides a detailed record of a taxpayer’s outward supplies, GSTR 3B serves as a summary return that reflects the total tax liability for a given tax period. Since these filings impact the overall GST compliance structure, businesses must ensure that both returns are correctly filed and reconciled. This article provides an in-depth look at GSTR 1, GSTR 3B, and their differences to help businesses stay compliant with the GST regulations in India.
What is GSTR 1?
GSTR 1 is a monthly or quarterly return that businesses must file to report their outward supplies of goods and services for a specific period. This return provides detailed information about sales transactions, including invoices issued to other businesses (B2B transactions) and sales made directly to consumers (B2C transactions). The primary objective of GSTR 1 is to maintain a transparent record of revenue generated by businesses, ensuring that the details of sales transactions match the recipient’s records.
The filing frequency of GSTR 1 depends on the annual turnover of the taxpayer. Businesses with an annual turnover exceeding Rs.1.5 crore are required to file GSTR 1 on a monthly basis, whereas businesses with an annual turnover up to Rs.1.5 crore have the option to file quarterly. This flexibility allows small businesses to manage compliance efficiently without the burden of frequent filings.
One of the key aspects of GSTR 1 is that it does not require any tax payment at the time of filing. Since it is only a record of outward supplies, businesses must ensure that all invoice details, including debit notes, credit notes, and amendments, are accurately reported in the return. Proper filing of GSTR 1 ensures that the recipient can claim Input Tax Credit (ITC) on the basis of the seller’s declared outward supplies.
What is GSTR 3B?
GSTR 3B is a monthly summary return that businesses file to declare their tax liability, ITC claims, and overall GST obligations for a particular period. Unlike GSTR 1, which provides detailed transaction-wise data, GSTR 3B is a summarized return that gives an overview of total sales, purchases, ITC claimed, and tax payable.
Businesses must file GSTR 3B on a monthly basis, irrespective of their turnover. However, businesses with an annual turnover of up to Rs.5 crore have the option to file GSTR 3B quarterly under the QRMP (Quarterly Return and Monthly Payment) scheme. The primary purpose of GSTR 3B is to ensure that the taxpayer has self-assessed their tax liability and has made the necessary GST payments before filing.
Unlike GSTR 1, where no tax payment is required at the time of filing, GSTR 3B mandates tax payment before submission. Any delay in filing GSTR 3B attracts penalties, which makes it crucial for businesses to ensure timely filing to avoid unnecessary financial burdens. Additionally, the tax liability auto-populates from GSTR 3B to GSTR 1, ensuring that the filings remain consistent and reducing the chances of mismatched records.
Key Differences Between GSTR 1 and GSTR 3B
While both GSTR 1 and GSTR 3B are essential in GST compliance, they serve different purposes. The difference between GSTR 1 and GSTR 3B can be categorized based on content, purpose, frequency of filing, tax payment, penalties, and reconciliation requirements.
The most fundamental distinction between the two returns is that GSTR 1 focuses on outward supplies, providing a detailed record of invoices and sales transactions, whereas GSTR 3B serves as a self-assessed summary return, helping businesses declare and pay their monthly tax liabilities.
Another key difference is that GSTR 1 can be filed monthly or quarterly, depending on the turnover of the business, while GSTR 3B must be filed monthly by all taxpayers, except for small businesses that opt for quarterly filing. Moreover, GSTR 1 does not require any tax payment, while GSTR 3B mandates tax payment before submission.
Tax Payment and Penalties for Late Filing
Since GSTR 1 is only a reporting return, no tax payment is required at the time of filing. However, taxpayers must ensure that the details of outward supplies are accurate and complete, as incorrect reporting could lead to reconciliation issues and discrepancies with the recipient’s records.
In contrast, GSTR 3B requires businesses to calculate and pay their tax liability before filing. Any delay in filing GSTR 3B leads to penalties, which vary depending on whether the return is a nil return or a return with taxable transactions.
For GSTR 1, a late filing penalty of Rs.200 per day (Rs.100 each for CGST and SGST) applies until the return is filed. For GSTR 3B, the penalty structure is as follows:
• Rs.20 per day for nil returns.
• Rs.50 per day for returns with taxable transactions.
These penalties continue accumulating until the return is filed, emphasizing the need for businesses to ensure timely compliance to avoid unnecessary financial liabilities.
Importance of Reconciling GSTR 1 and GSTR 3B
One of the most critical aspects of GST compliance is ensuring that the details reported in GSTR 1 and GSTR 3B are reconciled properly. Reconciliation is the process of matching the outward supply details filed in GSTR 1 with the tax liability declared in GSTR 3B, ensuring that there are no discrepancies in tax reporting.
Failure to reconcile GSTR 1 and GSTR 3B can lead to issues such as incorrect tax payments, potential interest liabilities, and even suspension of GST registration due to mismatches in reported data. Proper reconciliation helps businesses identify missing invoices, correct errors, and ensure accurate tax payments under the appropriate tax heads (CGST, SGST, IGST).
To maintain compliance, businesses must compare the invoice details of GSTR 1 with the summarized values of GSTR 3B before filing. Any discrepancies should be corrected immediately, and if additional tax is required, it should be paid along with interest to avoid penalties.
Conclusion
Knowing the difference between GSTR 1 and GSTR 3B is essential for every taxpayer under the GST regime. While GSTR 1 focuses on reporting outward supplies, providing detailed invoice-level data, GSTR 3B serves as a summary return that helps businesses declare their tax liabilities and make payments. Regular reconciliation between GSTR 1 and GSTR 3B ensures accuracy in tax reporting and prevents compliance issues. Since businesses must file both returns accurately and on time, ensuring consistency between them is crucial for avoiding penalties and tax disputes. For businesses looking to simplify GST return filing, leveraging expert assistance can help navigate the complexities of GSTR 1, GSTR 3B, and reconciliation, ensuring seamless compliance with GST regulations. 
You can connect with Compliance Calendar’s GST experts through mail at info@ccoffice.in or Call/Whatsapp at +91 9988424211.
FAQs
Q1. What is the main difference between GSTR 1 and GSTR 3B?
Ans. The difference between GSTR 1 and GSTR 3B lies in their purpose and content. GSTR 1 is a detailed return that reports a business’s outward supplies (sales) for a specific period, including invoice details and modifications. GSTR 3B, on the other hand, is a summary return that provides an overview of total sales, purchases, input tax credit (ITC), and the total tax liability that needs to be paid. While GSTR 1 provides detailed sales data, GSTR 3B helps in tax payment and self-assessment.
Q2. Who needs to file GSTR 1 and GSTR 3B?
Ans. All registered taxpayers under GST who make outward supplies (sales) must file GSTR 1. The frequency of filing depends on turnover—businesses with an annual turnover exceeding Rs.1.5 crore must file monthly, while those below Rs.1.5 crore can opt for quarterly filing.
GSTR 3B is mandatory for all regular taxpayers and must be filed monthly, regardless of turnover. However, businesses with an annual turnover of up to Rs.5 crore can opt for quarterly filing under the QRMP scheme.
Q3. Is tax payment required while filing GSTR 1 and GSTR 3B?
Ans. No tax payment is required while filing GSTR 1 because it only reports outward supplies and does not calculate tax liability. In contrast, GSTR 3B requires businesses to calculate and pay their tax liability before filing the return. If GSTR 3B is not filed on time, penalties and interest charges apply.
Q4. What happens if GSTR 1 and GSTR 3B are not filed on time?
Ans. Late filing of GSTR 1 attracts a penalty of Rs.200 per day (Rs.100 each for CGST and SGST) until the return is submitted. However, since no tax payment is involved in GSTR 1, businesses only face penalties and compliance issues.
For GSTR 3B, if filed late, penalties vary depending on whether the return is a nil return or has taxable transactions:
• Rs.20 per day for nil returns.
• Rs.50 per day for returns with taxable supplies.
Since GSTR 3B involves tax payment, late filing also attracts interest charges on unpaid tax liability, increasing financial burdens.
Q5. Can GSTR 1 and GSTR 3B figures be different?
Ans. Ideally, the details reported in GSTR 1 should match the values declared in GSTR 3B to maintain consistency in GST filings. However, differences can arise due to timing issues, incorrect invoice entries, or omitted transactions. To avoid mismatches, businesses must reconcile GSTR 1 and GSTR 3B regularly and correct discrepancies before filing.
Q6. How does reconciliation between GSTR 1 and GSTR 3B help in GST compliance?
Ans. Reconciliation between GSTR 1 and GSTR 3B ensures that:
• No invoices are missing or duplicated, reducing the risk of tax discrepancies.
• Correct tax amounts are paid, avoiding penalties and interest.
• ITC claims match supplier-reported data, preventing rejection of tax credits.
If significant differences exist between GSTR 1 and GSTR 3B, tax authorities may issue notices, and in extreme cases, the GSTIN may be suspended until discrepancies are resolved.
Q7. What is the due date for filing GSTR 1 and GSTR 3B?
Ans. For GSTR 1, the due date depends on the filing frequency:
• Monthly filing: 11th of the following month.
• Quarterly filing: Last day of the month following the quarter (e.g., 31st July for April-June quarter).
For GSTR 3B, the general due date is the 20th of the following month for monthly filers. Businesses with a turnover of up to Rs.5 crore and opting for quarterly filing under the QRMP scheme must file GSTR 3B by the 22nd or 24th of the month following the quarter, depending on their state.

In India, businesses are required to file multiple tax returns periodically to ensure transparency and accuracy in tax reporting. Among the most crucial filings are GSTR 1 and GSTR 3B, which serve distinct purposes in the GST system. Understanding the difference between GSTR 1 and GSTR 3B is essential for businesses to ensure timely and accurate compliance, avoiding penalties and discrepancies in tax records.

Both GSTR 1 and GSTR 3B play a significant role in the GST framework, but they differ in terms of purpose, frequency, and the information they contain. While GSTR 1 provides a detailed record of a taxpayer’s outward supplies, GSTR 3B serves as a summary return that reflects the total tax liability for a given tax period. Since these filings impact the overall GST compliance structure, businesses must ensure that both returns are correctly filed and reconciled. This article provides an in-depth look at GSTR 1, GSTR 3B, and their differences to help businesses stay compliant with the GST regulations in India.

What is GSTR 1?

GSTR 1 is a monthly or quarterly return that businesses must file to report their outward supplies of goods and services for a specific period. This return provides detailed information about sales transactions, including invoices issued to other businesses (B2B transactions) and sales made directly to consumers (B2C transactions). The primary objective of GSTR 1 is to maintain a transparent record of revenue generated by businesses, ensuring that the details of sales transactions match the recipient’s records.

The filing frequency of GSTR 1 depends on the annual turnover of the taxpayer. Businesses with an annual turnover exceeding Rs.1.5 crore are required to file GSTR 1 on a monthly basis, whereas businesses with an annual turnover up to Rs.1.5 crore have the option to file quarterly. This flexibility allows small businesses to manage compliance efficiently without the burden of frequent filings.

One of the key aspects of GSTR 1 is that it does not require any tax payment at the time of filing. Since it is only a record of outward supplies, businesses must ensure that all invoice details, including debit notes, credit notes, and amendments, are accurately reported in the return. Proper filing of GSTR 1 ensures that the recipient can claim Input Tax Credit (ITC) on the basis of the seller’s declared outward supplies.

What is GSTR 3B?

GSTR 3B is a monthly summary return that businesses file to declare their tax liability, ITC claims, and overall GST obligations for a particular period. Unlike GSTR 1, which provides detailed transaction-wise data, GSTR 3B is a summarized return that gives an overview of total sales, purchases, ITC claimed, and tax payable.

Businesses must file GSTR 3B on a monthly basis, irrespective of their turnover. However, businesses with an annual turnover of up to Rs.5 crore have the option to file GSTR 3B quarterly under the QRMP (Quarterly Return and Monthly Payment) scheme. The primary purpose of GSTR 3B is to ensure that the taxpayer has self-assessed their tax liability and has made the necessary GST payments before filing.

Unlike GSTR 1, where no tax payment is required at the time of filing, GSTR 3B mandates tax payment before submission. Any delay in filing GSTR 3B attracts penalties, which makes it crucial for businesses to ensure timely filing to avoid unnecessary financial burdens. Additionally, the tax liability auto-populates from GSTR 3B to GSTR 1, ensuring that the filings remain consistent and reducing the chances of mismatched records.

Key Differences Between GSTR 1 and GSTR 3B

While both GSTR 1 and GSTR 3B are essential in GST compliance, they serve different purposes. The difference between GSTR 1 and GSTR 3B can be categorized based on content, purpose, frequency of filing, tax payment, penalties, and reconciliation requirements.

The most fundamental distinction between the two returns is that GSTR 1 focuses on outward supplies, providing a detailed record of invoices and sales transactions, whereas GSTR 3B serves as a self-assessed summary return, helping businesses declare and pay their monthly tax liabilities.

Another key difference is that GSTR 1 can be filed monthly or quarterly, depending on the turnover of the business, while GSTR 3B must be filed monthly by all taxpayers, except for small businesses that opt for quarterly filing. Moreover, GSTR 1 does not require any tax payment, while GSTR 3B mandates tax payment before submission.

Tax Payment and Penalties for Late Filing

Since GSTR 1 is only a reporting return, no tax payment is required at the time of filing. However, taxpayers must ensure that the details of outward supplies are accurate and complete, as incorrect reporting could lead to reconciliation issues and discrepancies with the recipient’s records.

In contrast, GSTR 3B requires businesses to calculate and pay their tax liability before filing. Any delay in filing GSTR 3B leads to penalties, which vary depending on whether the return is a nil return or a return with taxable transactions.

For GSTR 1, a late filing penalty of Rs.200 per day (Rs.100 each for CGST and SGST) applies until the return is filed. For GSTR 3B, the penalty structure is as follows:

• Rs.20 per day for nil returns.

• Rs.50 per day for returns with taxable transactions.

These penalties continue accumulating until the return is filed, emphasizing the need for businesses to ensure timely compliance to avoid unnecessary financial liabilities.

Importance of Reconciling GSTR 1 and GSTR 3B

One of the most critical aspects of GST compliance is ensuring that the details reported in GSTR 1 and GSTR 3B are reconciled properly. Reconciliation is the process of matching the outward supply details filed in GSTR 1 with the tax liability declared in GSTR 3B, ensuring that there are no discrepancies in tax reporting.

Failure to reconcile GSTR 1 and GSTR 3B can lead to issues such as incorrect tax payments, potential interest liabilities, and even suspension of GST registration due to mismatches in reported data. Proper reconciliation helps businesses identify missing invoices, correct errors, and ensure accurate tax payments under the appropriate tax heads (CGST, SGST, IGST).

To maintain compliance, businesses must compare the invoice details of GSTR 1 with the summarized values of GSTR 3B before filing. Any discrepancies should be corrected immediately, and if additional tax is required, it should be paid along with interest to avoid penalties.

Conclusion

Knowing the difference between GSTR 1 and GSTR 3B is essential for every taxpayer under the GST regime. While GSTR 1 focuses on reporting outward supplies, providing detailed invoice-level data, GSTR 3B serves as a summary return that helps businesses declare their tax liabilities and make payments. Regular reconciliation between GSTR 1 and GSTR 3B ensures accuracy in tax reporting and prevents compliance issues. Since businesses must file both returns accurately and on time, ensuring consistency between them is crucial for avoiding penalties and tax disputes. For businesses looking to simplify GST return filing, leveraging expert assistance can help navigate the complexities of GSTR 1, GSTR 3B, and reconciliation, ensuring seamless compliance with GST regulations.

You can connect with Compliance Calendar’s GST experts through mail at info@ccoffice.in or Call/Whatsapp at +91 9988424211.

FAQs

Q1. What is the main difference between GSTR 1 and GSTR 3B?

Ans. The difference between GSTR 1 and GSTR 3B lies in their purpose and content. GSTR 1 is a detailed return that reports a business’s outward supplies (sales) for a specific period, including invoice details and modifications. GSTR 3B, on the other hand, is a summary return that provides an overview of total sales, purchases, input tax credit (ITC), and the total tax liability that needs to be paid. While GSTR 1 provides detailed sales data, GSTR 3B helps in tax payment and self-assessment.

Q2. Who needs to file GSTR 1 and GSTR 3B?

Ans. All registered taxpayers under GST who make outward supplies (sales) must file GSTR 1. The frequency of filing depends on turnover—businesses with an annual turnover exceeding Rs.1.5 crore must file monthly, while those below Rs.1.5 crore can opt for quarterly filing.

GSTR 3B is mandatory for all regular taxpayers and must be filed monthly, regardless of turnover. However, businesses with an annual turnover of up to Rs.5 crore can opt for quarterly filing under the QRMP scheme.

Q3. Is tax payment required while filing GSTR 1 and GSTR 3B?

Ans. No tax payment is required while filing GSTR 1 because it only reports outward supplies and does not calculate tax liability. In contrast, GSTR 3B requires businesses to calculate and pay their tax liability before filing the return. If GSTR 3B is not filed on time, penalties and interest charges apply.

Q4. What happens if GSTR 1 and GSTR 3B are not filed on time?

Ans. Late filing of GSTR 1 attracts a penalty of Rs.200 per day (Rs.100 each for CGST and SGST) until the return is submitted. However, since no tax payment is involved in GSTR 1, businesses only face penalties and compliance issues.

For GSTR 3B, if filed late, penalties vary depending on whether the return is a nil return or has taxable transactions:

• Rs.20 per day for nil returns.

• Rs.50 per day for returns with taxable supplies.

Since GSTR 3B involves tax payment, late filing also attracts interest charges on unpaid tax liability, increasing financial burdens.

Q5. Can GSTR 1 and GSTR 3B figures be different?

Ans. Ideally, the details reported in GSTR 1 should match the values declared in GSTR 3B to maintain consistency in GST filings. However, differences can arise due to timing issues, incorrect invoice entries, or omitted transactions. To avoid mismatches, businesses must reconcile GSTR 1 and GSTR 3B regularly and correct discrepancies before filing.

Q6. How does reconciliation between GSTR 1 and GSTR 3B help in GST compliance?

Ans. Reconciliation between GSTR 1 and GSTR 3B ensures that:

• No invoices are missing or duplicated, reducing the risk of tax discrepancies.

• Correct tax amounts are paid, avoiding penalties and interest.

• ITC claims match supplier-reported data, preventing rejection of tax credits.

If significant differences exist between GSTR 1 and GSTR 3B, tax authorities may issue notices, and in extreme cases, the GSTIN may be suspended until discrepancies are resolved.

Q7. What is the due date for filing GSTR 1 and GSTR 3B?

Ans. For GSTR 1, the due date depends on the filing frequency:

• Monthly filing: 11th of the following month.

• Quarterly filing: Last day of the month following the quarter (e.g., 31st July for April-June quarter).

For GSTR 3B, the general due date is the 20th of the following month for monthly filers. Businesses with a turnover of up to Rs.5 crore and opting for quarterly filing under the QRMP scheme must file GSTR 3B by the 22nd or 24th of the month following the quarter, depending on their state.