GSTR-4 Annual Return FY 2025-26: Full Guide

Every quarter, you file CMP-08 and pay your composition tax. That quarterly statement is a payment challan, not a comprehensive return. GSTR-4 is where the full picture comes together: inward supplies, outward supplies, reverse charge liability, tax adjustments, and TDS/TCS credits for the entire year.

Most composition dealers treat GSTR-4 as an afterthought because the quarterly CMP-08 feels like the "real" filing. That is a mistake. GSTR-4 is the return the department uses to reconcile your annual liability. Mismatches between CMP-08 payments and GSTR-4 declarations trigger notices under Sections 73 and 74 of the CGST Act.

Who Must File GSTR-4

Every taxpayer registered under the Composition Scheme (Section 10 of the CGST Act) must file GSTR-4. This includes:

• Manufacturers with aggregate turnover up to Rs 1.5 crore (Rs 75 lakh in special category states)
• Traders (goods only) with aggregate turnover up to Rs 1.5 crore
• Restaurants not serving alcohol, with aggregate turnover up to Rs 1.5 crore
• Service providers under the special composition scheme (Notification 2/2019-CT) with aggregate turnover up to Rs 50 lakh

If you opted for composition at any point during FY 2025-26, you must file GSTR-4 for the period you were under the scheme, even if you switched to the regular scheme mid-year.

Who Does Not File GSTR-4

Regular GST taxpayers (those filing GSTR-1 and GSTR-3B), Input Service Distributors, Casual Taxable Persons, Non-Resident Taxable Persons, and persons liable to deduct TDS under Section 51 do not file GSTR-4. They have their own return forms.

Composition Scheme Tax Rates

These rates apply on turnover of taxable supplies, not on the value of individual invoices. Composition dealers cannot charge GST to customers and cannot issue tax invoices. They issue a Bill of Supply instead.

The trade-off is clear: lower compliance burden and a flat tax rate, but no Input Tax Credit (ITC) on purchases and no inter-state supply capability.

GSTR-4 vs CMP-08: The Difference

Comparison

GSTR-4 vs CMP-08

Understanding the two filings composition dealers must make

Parameter	CMP-08 (Quarterly Statement)	GSTR-4 (Annual Return)
Frequency	Every quarter (4 times a year)	Once a year (annual)
Purpose	Pay composition tax for the quarter	Consolidate and reconcile full-year data
What you declare	Self-assessed tax on outward supplies for the quarter	Inward supplies, outward supplies, reverse charge, TDS/TCS credits, and tax adjustments for the year
Due date	18th of month following the quarter	June 30 of the following financial year
Editable in GSTR-4?	Auto-populated into Table 5 (non-editable)	Tables 4 and 6 require manual input
Late fee	Rs 50/day, max Rs 2,000	Rs 50/day, max Rs 2,000 (Rs 20/day, max Rs 500 for nil)

Takeaway: CMP-08 is the quarterly tax payment. GSTR-4 is the annual reconciliation. Both are mandatory for composition dealers.

Source: CGST Rules 62(1) and 62(4), CBIC

Think of CMP-08 as advance tax instalments and GSTR-4 as the annual income tax return. The quarterly payments keep you current, but the annual return is where the department verifies whether your quarterly declarations were accurate.

GSTR-4 Table-by-Table Format

GSTR-4 has 9 tables. Here is what each one covers and what you need to fill:

Tables 1-3: Basic Information (Auto-populated)

Tables 1, 2, and 3 contain your GSTIN, legal name, trade name, and the financial year. These are auto-filled from your GST registration data. No action needed.

Table 4: Inward Supplies (Manual Entry)

This is where most of your manual work happens.

For each sub-table, report the total taxable value and the IGST, CGST, SGST, and cess amounts. Since composition dealers cannot claim ITC, these figures do not create any credit. They are purely for reconciliation and reverse charge tax payment purposes.

Table 5: CMP-08 Summary (Auto-populated, Non-editable)

Table 5 pulls in data from all four CMP-08 filings you made during the year. It shows your self-assessed tax liability quarter by quarter. You cannot edit this table. If there is an error in your CMP-08 data, you must address it through the appropriate amendment process.

Table 6: Outward Supplies (Partially Manual)

Rows 1 through 11 of Table 6 are auto-populated from your CMP-08 filings and cannot be edited.

Rows 12 through 16 are user-input cells where you can declare additional outward supply details, rate-wise. If your CMP-08 declarations were complete and accurate, these rows may remain zero. But if you need to report any adjustments or supply categories not captured in CMP-08, this is where you do it.

Table 7: TDS/TCS Credit (Auto-populated)

If any TDS was deducted by a government entity under Section 51, or TCS was collected by an e-commerce operator under Section 52, those credits appear here. This table is auto-populated from the TDS/TCS returns filed by the deductor/collector.

Table 8: Tax, Interest, and Late Fee

Table 8 calculates your net tax liability after setting off TDS/TCS credits (if any) against your total liability. Any interest on late payment and late fee are computed here.

Table 9: Refund Claimed from Electronic Cash Ledger

If you have excess balance in your electronic cash ledger after adjusting all liabilities, you can claim a refund through Table 9. This applies only to the cash ledger balance, not to ITC (which composition dealers do not have).

How to File GSTR-4: Step by Step

Step-by-Step Guide

Login to the GST Portal

Verify Tables 1-3 and Table 5

Enter Table 4: Inward Supplies

Enter Table 6: Outward Supplies (Rows 12-16)

Review Table 7: TDS/TCS Credits

Preview and Verify

File Using DSC or EVC

Critical point: All four quarters of CMP-08 for FY 2025-26 must be filed before you can file GSTR-4. If any CMP-08 is pending, file it first. The due dates for CMP-08 are the 18th of the month following each quarter (July 18, October 18, January 18, and April 18).

Late Fee and Interest Calculation

Late Fee

The late fee starts from July 1, 2026 (the day after the due date) and accumulates daily until the date of filing.

Interest

Interest at 18% per annum applies on the outstanding tax amount from the date the tax was due until the date of payment. This is calculated on the net tax liability, not on the gross turnover.

Example: If your net tax payable in GSTR-4 is Rs 15,000 and you file 45 days late:

• Late fee: 45 x Rs 50 = Rs 2,250, but capped at Rs 2,000
• Interest: Rs 15,000 x 18% x (45/365) = Rs 333
• Total additional cost: Rs 2,333

Penalty for Non-Filing

Beyond late fees and interest, persistent non-filing can lead to a penalty of 10% of the tax amount (minimum Rs 10,000) under Section 122 of the CGST Act. The GST officer can also suspend or cancel your GST registration for continuous non-compliance.

The 3-Year Filing Window

From July 1, 2025, a new restriction applies: GSTR-4 cannot be filed if more than 3 years have elapsed from the original due date.

What this means in practice:

If you have unfiled GSTR-4 returns from older financial years, check whether the 3-year window is still open. Once it closes, the return cannot be filed at all, and you lose the ability to regularise that period.

Pre-Filing Checklist

Before you file GSTR-4 for FY 2025-26, verify the following:

1. All four CMP-08 returns are filed for Q1 (April-June 2025), Q2 (July-September 2025), Q3 (October-December 2025), and Q4 (January-March 2026).

2. Reverse charge liability is computed for all inward supplies attracting RCM (legal services from advocates, GTA services, services from unregistered persons above the threshold, import of services).

3. Turnover reconciliation: Total outward supply turnover in your books matches the sum of CMP-08 quarterly declarations. Any mismatch should be adjusted in Table 6 (rows 12-16).

4. TDS/TCS credits: If you supplied goods through an e-commerce operator, verify that TCS credits in Table 7 match the TCS certificates received.

5. Composition threshold check: If your aggregate turnover crossed Rs 1.5 crore (or Rs 75 lakh in special category states, or Rs 50 lakh for service providers) during FY 2025-26, you should have switched to the regular scheme. File GSTR-4 only for the composition period.

6. Pending tax payments: Any tax due beyond what was paid through CMP-08 must be deposited in the electronic cash ledger before filing.

Common Mistakes to Watch For

Ignoring reverse charge: Composition dealers must still pay GST under reverse charge on specific inward supplies (legal services, GTA, import of services). This is the most commonly missed liability. It goes into Table 4B.

CMP-08 turnover mismatch: If your quarterly CMP-08 declarations do not add up to your annual turnover in the books, the GSTR-4 will flag a discrepancy. Reconcile before filing, not after a notice arrives.

Filing GSTR-4 without filing all CMP-08: The portal will not allow GSTR-4 submission until all four CMP-08 returns are filed. If you skipped a quarter, file the CMP-08 first (with late fee and interest).

Not reporting purchases from unregistered suppliers: Table 4C requires details of purchases from unregistered suppliers. Many dealers leave this blank, but the department can cross-verify from the supplier's perspective if the supplier later registers.

Confusing composition tax rate with regular GST: Composition tax is on turnover, not on individual invoice value. If you are a manufacturer paying 1%, it is 1% of your total taxable turnover for the year, split equally between CGST and SGST.

Source and Verification

The due date extension to June 30 is per CGST Notification 12/2024 dated July 10, 2024 (amending Rule 62 of the CGST Rules, 2017). Late fee rates reflect the reduced rates under CGST Notification 73/2017 as amended. The 3-year filing restriction was introduced under Section 39(11) of the CGST Act, effective July 1, 2025 per the 53rd GST Council recommendation. Composition scheme eligibility and tax rates are governed by Section 10 of the CGST Act read with Notification 2/2019-CT (for service providers). All figures verified against the GST portal (gst.gov.in) and CBIC circulars as of June 2026.