GST Late Fee and Interest: How Much You Pay for Late Returns

If you file a GST return late, you pay two things: a late fee for each day of delay, and interest at 18% a year on any tax paid late. For GSTR-3B the late fee is ₹50 a day (₹20 for a nil return), capped at ₹2,000 to ₹10,000 depending on turnover (₹500 for nil returns). Interest applies only to the tax you pay in cash.

Both are paid in cash and cannot be adjusted against input tax credit. Here is how each is worked out.

How much is the late fee for GSTR-3B and GSTR-1?

Late fee is charged under Section 47 of the CGST Act, split equally between CGST and SGST. The per-day amount and the maximum depend on whether the return is nil and on your aggregate turnover in the previous financial year (total turnover across all your GSTINs on one PAN).

Return type	Per day	Maximum per return
Nil GSTR-3B / nil GSTR-1	₹20 (₹10 CGST + ₹10 SGST)	₹500
Turnover up to ₹1.5 crore	₹50 (₹25 + ₹25)	₹2,000
Turnover ₹1.5 crore to ₹5 crore	₹50 (₹25 + ₹25)	₹5,000
Turnover above ₹5 crore	₹50 (₹25 + ₹25)	₹10,000

These caps apply from the June 2021 tax period onwards. They apply to monthly and quarterly (QRMP) returns alike.

Example: Your turnover last year was ₹80 lakh. You file June’s GSTR-3B (due 20 July) on 30 July, 10 days late. Late fee = 10 × ₹50 = ₹500 (₹250 CGST + ₹250 SGST). Had you filed 60 days late, the fee would be 60 × ₹50 = ₹3,000, but the cap limits it to ₹2,000.

Late fee for GSTR-1

GSTR-1 follows the same per-day fees and caps as GSTR-3B. Because GSTR-1 must be filed before GSTR-3B for the same period, a late GSTR-1 usually makes GSTR-3B late too, so you can end up paying two late fees for one month.

What is the late fee for GSTR-9 (annual return)?

From FY 2022-23 onwards, the late fee for GSTR-9 is:

Aggregate turnover	Per day	Maximum
Up to ₹5 crore	₹50 (₹25 + ₹25)	0.04% of turnover in the state
₹5 crore to ₹20 crore	₹100 (₹50 + ₹50)	0.04% of turnover in the state
Above ₹20 crore	₹200 (₹100 + ₹100)	0.5% of turnover in the state

If you also have to file GSTR-9C, the CBIC has clarified that the annual return is complete only when both are filed. Late fee runs until GSTR-9C is filed too. Note that businesses with turnover up to ₹2 crore are exempt from GSTR-9 from FY 2024-25. See our GSTR-9 guide.

How is interest on late GST payment calculated?

Interest is charged under Section 50 at 18% a year, for each day from the day after the due date until the day you pay.

The key point: interest is charged only on the net tax paid in cash, meaning the tax not covered by input tax credit (ITC: the GST you paid on purchases that you can deduct). This “net cash” rule was written into the law with retrospective effect from 1 July 2017.

Formula: Interest = Tax paid in cash late × 18% × days of delay ÷ 365

Example: Your GSTR-3B for August shows ₹1,50,000 tax. ITC covers ₹1,00,000 and ₹50,000 is paid in cash. You file on 19 October, 29 days after the 20 September due date. Interest = ₹50,000 × 18% × 29 ÷ 365 = ₹715 (rounded). Split equally if the tax was CGST + SGST.

Interest on ITC wrongly claimed

If you claim ITC you were not entitled to and use it to pay tax, interest also applies, at 18% a year (the earlier 24% rate was replaced by a retrospective amendment in 2022). It runs from the date of use until you reverse it. Credit that is wrongly claimed but never used does not attract this interest.

Auto-calculated interest from January 2026

From the January 2026 tax period, the GST portal works out interest for a delayed GSTR-3B and auto-fills it in the next period’s GSTR-3B (Table 5.1). The portal gives you credit for the minimum cash balance that sat in your electronic cash ledger from the due date until payment.

You cannot reduce this auto-filled figure; it is treated as the minimum payable. If your own calculation shows more interest is due, you must increase it yourself.

Tip: Keeping enough cash in your electronic cash ledger by the due date reduces interest, even if you file the return a few days late.

The bigger risk: returns time-barred after three years

Since 1 October 2023, the law says GSTR-1, GSTR-3B, GSTR-4, GSTR-9/9C and some other returns cannot be filed after three years from their due date. The GST portal started enforcing this from the November 2025 tax period.

A barred return cannot be filed at all. Missing returns can then lead to a best-judgement assessment and penalty notices, which cost far more than any late fee. If you have old pending returns, file them now.

How to pay late fee and interest

1. Open the late return on the GST portal. Late fee and interest (where the portal calculates it) appear in the payment table.
2. Check whether your electronic cash ledger has enough balance.
3. If not, create a challan (PMT-06) and pay by net banking, UPI, card or over the counter.
4. Offset the liability and file the return with DSC or EVC.

Common mistakes

• Assuming nil returns can wait. Even with zero sales, the ₹20/day fee applies.
• Trying to pay late fee from ITC. It must be paid in cash.
• Calculating interest on gross tax instead of the cash portion and overpaying, or ignoring interest altogether and getting a notice later.
• Lowering the portal’s auto-calculated interest. From January 2026 the portal will not allow it.
• Leaving old returns pending. Past the three-year limit, you lose the right to file them.

How to avoid late fee and interest

• File GSTR-1 by the 11th and GSTR-3B by the 20th (or the QRMP dates if you file quarterly). Our GSTR-1 vs GSTR-3B guide lists them.
• Consider the QRMP scheme if your turnover is up to ₹5 crore and monthly filing is a struggle.
• File nil returns by SMS in under a minute.
• Deposit tax into the cash ledger by the due date even if reconciliation is not finished.

What to do next

If you’ve received a notice demanding late fee or interest, read our guide on how to respond to a GST notice. If you have several returns pending and are unsure what you owe, our GST return filing team can work out the exact figures and clear the backlog.