Accounts and Records under GST in India – Requirements, Rules and Checklist 2026

Table of Contents:-

Accounts and records under GST must be maintained by registered businesses in accordance with Section 35 and Section 36 of the Central Goods and Services Tax Act, 2017 and Rules 56 to 58 of the CGST Rules, 2017.

GST-registered businesses are required to maintain true and correct records of inward and outward supplies, stock, input tax credit, output tax liability, taxes paid and other prescribed particulars. Additional requirements apply to manufacturers, service providers, works contractors, agents, warehouse operators and transporters.

These obligations apply to companies, LLPs, partnerships, proprietorships, foreign-owned Indian subsidiaries and other registered businesses according to their activities and the relevant provisions.

Updated for October 2026: This guide explains the current framework for GST accounts and records, electronic bookkeeping, stock records, GSTR-2B reconciliation, record preservation, audit readiness and industry-specific compliance. It also distinguishes the discontinued mandatory CA/CMA GST audit under former Section 35(5) from continuing GST record-keeping requirements.

EzyBiz India Consulting LLP provides accounting, bookkeeping, GST return filing, GST reconciliation and compliance advisory services to Indian and foreign-owned businesses.

Need help maintaining GST accounts and records? Call +91 98992 17778, email anil@ezybizindia.in or contact our GST specialists on WhatsApp.

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Accounts and Records under GST – Overview

What Are GST Accounts and Records?

GST accounts and records are the books, registers, supporting documents and electronic information maintained to substantiate taxable transactions, input tax credit, tax liability, payments and compliance under GST law.

They provide the evidence necessary to establish whether GST returns accurately reflect a business’s financial transactions.

Who Must Maintain GST Books of Account?

Section 35(1) requires every registered person to maintain true and correct accounts of the prescribed transactions and particulars.

Separate obligations also apply to owners or operators of warehouses and godowns and to transporters under Section 35(2), whether registered or not, as applicable.

Why Is Maintaining Proper GST Records Important?

Proper records support accurate GST returns, input tax credit eligibility, refunds, departmental verification and reconciliation with annual financial statements.

Incomplete accounts can result in disputed ITC, incorrect tax calculations, notices and additional tax exposure.

Legal Provisions for Maintaining GST Accounts

Section 35 of the CGST Act

Section 35 requires registered persons to maintain true and correct accounts relating to manufacture or production, inward and outward supplies, stock, ITC availed, output tax payable and paid, and other prescribed information.

Special requirements may apply to businesses operating through multiple registered locations.

Rule 56 – Maintenance of Accounts

Rule 56 prescribes detailed records and supporting documentation for registered persons, including records of imports, exports, reverse charge supplies, invoices, stock, advances, tax particulars and specified activities.

Applicable records must be supported by the prescribed documents and maintained in accordance with the relevant sub-rules.

Rules 57 and 58 – Electronic Records and Warehouses

Rule 57 covers generation, backup and production of electronic records.

Rule 58 prescribes additional requirements for warehouse operators, godown operators and transporters, including specified enrolment and goods movement records.

For the official provisions, refer to Section 35 of the CGST Act and Rule 56 of the CGST Rules.

Mandatory Books and Registers under GST

Purchase Register and Inward Supply Records

Businesses should maintain records of goods and services purchased, including supplier details, invoice numbers, dates, taxable values, tax rates, GST amounts and relevant accounting classifications.

Purchases liable to reverse charge should be identified separately and accounted for according to the applicable provisions.

Sales Register and Outward Supply Records

Sales records should capture customer information, invoice particulars, taxable and exempt supplies, exports, debit and credit notes and applicable GST amounts.

The sales register should support information reported in GSTR-1 and GSTR-3B.

Input Tax Credit and Output Tax Registers

The taxpayer should maintain records of input tax credit availed, reversed, reclaimed and utilised, as applicable.

Separate accounting should be maintained for CGST, SGST, IGST and compensation cess where relevant, together with output tax payable and tax discharged.

GST Record	Principal Information	Purpose
Purchase register	Supplier, invoice, GSTIN, value, tax	Inward supply and ITC reconciliation
Sales register	Customer, invoice, place of supply, tax	Outward supply reporting
Stock register	Opening stock, receipts, issues and balance	Inventory control
ITC register	Credit availed, reversed, reclaimed and utilised	Input tax credit compliance
Tax liability register	Output tax and applicable reverse charge	Tax payment reconciliation
Document register	Invoices, debit notes, credit notes and challans	Supporting audit trail

GST Invoice, Debit Note and Credit Note Records

Tax Invoices and Bills of Supply

Registered persons should retain tax invoices and bills of supply issued or received, as applicable, with the particulars required under GST law.

Invoice numbering, dates and tax amounts should remain traceable to the accounting records and relevant returns.

Credit Notes and Debit Notes

Credit and debit notes should be recorded with appropriate references to the underlying transactions and invoices.

GST adjustments should be made according to Section 34 and other applicable provisions, including statutory reporting timelines.

Delivery Challans and Payment Vouchers

Businesses should preserve relevant delivery challans, receipt vouchers, payment vouchers and refund vouchers.

Additional documents may be required for goods sent for job work, stock transfers, imports, exports and other specified transactions.

Stock Register Requirements under GST

Opening Stock, Receipts and Supplies

Under Rule 56, applicable registered persons must maintain prescribed stock accounts for goods received and supplied.

The records should capture opening stock, quantities received, supplies, closing stock and other specified inventory movements.

Lost, Stolen, Destroyed and Written-Off Goods

The stock accounts should capture goods lost, stolen, destroyed, written off or disposed of by way of gift or free samples, along with the relevant supporting evidence.

Businesses should also examine the applicable input tax credit restrictions and reversals where relevant.

Raw Materials, Finished Goods and Scrap

Manufacturers and inventory-intensive businesses should maintain appropriate records for raw materials, work in progress, finished goods, scrap and wastage.

The quantity records should reconcile with production, purchase and sales information.

GST Accounts for Manufacturing Businesses

Monthly Production Records

Rule 56 prescribes production-related accounts for manufacturers, including quantitative details of inputs used and goods manufactured.

Monthly production records should be reconciled with material consumption and stock balances.

Raw Material Consumption and Wastage

Manufacturers should maintain records of raw materials used, production output, waste and by-products, as applicable.

Where there are production losses, the business should be able to explain them through appropriate manufacturing and inventory records.

Production and GST Return Reconciliation

Manufacturing output, dispatches and stock transfers should be reconciled with taxable supplies reported in GST returns.

Differences between physical quantities and accounting records should be reviewed promptly.

GST Accounts for Service Providers

Details of Services Supplied

Service providers should maintain records of services rendered, invoices, customers, receipts and applicable taxes.

Service agreements, work orders and relevant supporting documents may be important evidence of the nature, timing and place of supply.

Input Goods and Services Utilised

Rule 56 includes record-keeping requirements relating to goods and input services used in providing services, as applicable.

Businesses should maintain appropriate expense records and documents supporting input tax credit.

Advances, Receivables and Service Contracts

Relevant advances received, paid and adjusted should be tracked in accordance with the applicable GST provisions.

Service businesses should also reconcile contract milestones, invoices, receipts, credit notes and taxable values.

Works Contract and Agent Records under GST

Separate Works Contract Accounts

Persons executing works contracts are required to maintain separate prescribed accounts for relevant works contracts.

These may include the recipient’s name and address, materials and services received and utilised, payments and supplier details.

Records Maintained by Agents

Agents receiving or supplying goods or services on behalf of principals must maintain records prescribed under Rule 56.

These include relevant authorisations, transaction particulars, principal-wise accounts and taxes paid, as applicable.

Job Work and Principal-to-Agent Movement

Job work and transactions involving agents require appropriate records of goods movement, challans, supplies and applicable tax treatment.

Businesses should review the relevant provisions instead of treating all transfers as ordinary sales.

Place Where GST Accounts and Records Must Be Maintained

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Principal Place of Business

Section 35 generally requires the prescribed books and records to be maintained at the principal place of business declared in the GST registration certificate.

Businesses should ensure that their accounting arrangement satisfies the statutory requirements and allows relevant records to be produced when required.

Additional Places of Business and Branches

Where a registered person has more than one place of business listed in the GST registration, accounts relating to each place must be maintained in accordance with Section 35 and Rule 56.

Properly maintained electronic records may support accessibility at relevant locations as permitted under the rules.

Changes in Business Locations

When a business relocates or adds an office, branch, factory or warehouse, it should evaluate whether GST registration particulars require amendment.

See our GST Registration Amendment in India guide.

Electronic Books of Account under GST

Can GST Books Be Maintained Electronically?

Yes. The CGST Act and Rules permit the maintenance of prescribed accounts and records in electronic form, subject to applicable authentication, preservation and production requirements.

Businesses may use suitable accounting software or other reliable electronic systems, provided the statutory conditions are satisfied.

Electronic Backup and Recovery under Rule 57

Rule 57 requires proper electronic backups so that records can be restored within a reasonable period in the event of accidental loss, destruction or similar incidents.

Businesses should implement regular backups, controlled access, recovery testing and appropriate security measures.

Audit Trail and Changes to Accounting Entries

Under Rule 56, electronic accounting records should preserve relevant information concerning edited or deleted entries as prescribed.

Businesses should maintain traceable corrections rather than silently overwriting accounting data.

For practical accounting assistance, see our Virtual Accounting and Bookkeeping Services in India.

GST Record Retention Period under Section 36

General Retention Period of 72 Months

Section 36 generally requires registered persons to retain prescribed accounts and records until the expiry of 72 months from the due date of furnishing the annual return for the financial year to which those records relate.

The period is calculated using the statutory annual-return due date, not simply from the date of an individual invoice.

Retention during Appeals and Investigations

Where the taxpayer is involved in specified appeals, revisions, proceedings or investigations, records relating to the subject matter must be preserved for the longer period prescribed under Section 36.

This may extend to one year after final disposal of the relevant proceedings where that date is later than the ordinary retention deadline.

Example of GST Books Retention

Assume the statutory due date for the annual return relating to a particular financial year is 31 December of the following financial year and has not been changed.

The general 72-month period would be calculated from that due date, subject to the special retention rules for proceedings and any applicable statutory changes.

Situation	Retention Requirement
Ordinary GST records	72 months from the relevant annual-return due date
Records relating to specified appeals or investigations	Longer statutory period under Section 36
Electronic records	Same applicable retention period, with backup requirements

GSTR-1, GSTR-3B and GSTR-2B Reconciliation

Sales Register versus GSTR-1

The outward supply register should be reconciled with GSTR-1, including taxable values, exempt supplies, exports and credit or debit notes.

Businesses should investigate differences before finalising returns or annual reconciliations.

Purchase Register versus GSTR-2B

The purchase register should be reconciled with GSTR-2B and other applicable GST information to assess input tax credit eligibility.

Supplier invoice mismatches, blocked credits, reversals and timing differences should be documented.

Tax Ledger versus GSTR-3B

Output tax, ITC utilisation, cash payments and reverse charge liabilities should be reconciled with GSTR-3B and the electronic ledgers on the GST Portal.

For recurring compliance, see our GST Return Filing Services in India.

E-Invoicing, E-Way Bills and Digital GST Records

E-Invoice Records and Invoice Reference Numbers

Businesses covered by mandatory e-invoicing should preserve relevant tax invoices, Invoice Reference Numbers, acknowledgements and electronic records.

The applicability of e-invoicing depends on the prescribed turnover conditions and exclusions in force for the relevant period.

E-Way Bill Records

Where e-way bills are required, businesses should retain relevant e-way bill information and supporting transport, delivery and invoice documentation.

The goods movement records should reconcile with stock and accounting entries.

Read our E-Way Bill under GST guide.

Digital Document Management

Businesses should maintain structured electronic folders or a reliable document-management system for invoices, returns, challans, contracts, shipping bills and correspondence.

Document indexing and controlled access can help retrieve information efficiently during departmental verification.

Records Required for Warehouses and Transporters

Warehouse and Godown Records

Owners or operators of warehouses and godowns should maintain the records prescribed under Section 35(2) and Rule 58, including relevant information relating to goods received, stored, moved and dispatched.

The records should facilitate identification of goods and their owners and support lawful physical verification.

Transporter and Carrier Records

Transporters should maintain prescribed information about goods transported, delivered and stored in transit, including applicable consignor and consignee details.

Where required, the relevant enrolment provisions and movement-document requirements must also be complied with.

FORM GST ENR-01 and Related Compliance

Rule 58 prescribes enrolment requirements for specified warehouse operators and transporters who are not otherwise registered, where applicable.

Eligible persons should use the prescribed GST Portal enrolment facility and update relevant information when required.

GST Audit, Verification and Consequences of Missing Records

Departmental Audit under Section 65

GST authorities may undertake departmental audit under Section 65 in accordance with the prescribed procedures.

Accurate records help taxpayers substantiate purchases, supplies, input tax credit, tax payments and other matters examined during an audit.

Mandatory GST Audit versus GSTR-9C

The former requirement for specified taxpayers to have their accounts audited by a Chartered Accountant or Cost Accountant under Section 35(5) was discontinued from 1 August 2021.

Where applicable, GSTR-9C is now a self-certified reconciliation statement under the relevant Section 44 framework. Departmental and special GST audits remain separate legal processes.

For further guidance, see our GST Audit Services and GST Audit Checklist.

Consequences of Incomplete GST Records

Where supplies are not properly accounted for, Section 35(6) can result in determination of tax on unaccounted goods or services under the applicable statutory mechanism.

Defective records can also affect ITC eligibility, refund claims and other compliance matters, depending on the facts and legal provisions.

For departmental notice support, visit our GST Assessment and Litigation Services.

GST Accounting Checklist and EzyBiz India Services

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Monthly GST Accounting Checklist

Businesses should establish a consistent monthly or quarterly review process according to their filing category.

Update sales and purchase registers
Verify customer and supplier GSTINs
Record tax invoices and credit or debit notes
Reconcile GSTR-1 with outward supply records
Reconcile purchase records with GSTR-2B
Identify ineligible and reversed ITC
Reconcile GSTR-3B with tax ledgers
Verify cash and credit ledger balances
Update inventory, branch and stock-transfer records
Reconcile reverse charge transactions
Review e-invoice and e-way bill records
Archive supporting documents and backups

Professional GST Bookkeeping and Reconciliation

EzyBiz India Consulting LLP assists businesses with accounting setup, GST-compliant bookkeeping, monthly financial close, tax reconciliations and preparation of records supporting statutory GST returns.

Our services are suitable for domestic businesses, new companies, growing SMEs and foreign-owned Indian subsidiaries.

Explore our Accounting and Bookkeeping Services and GST Return Filing Services.

Frequently Asked Questions on Accounts and Records under GST

How long must GST records be maintained?

Generally, 72 months from the due date of furnishing the relevant annual return, subject to longer retention requirements for specified proceedings.

Can GST books be maintained electronically?

Yes. Electronic records are permitted subject to prescribed authentication, backup, preservation and production requirements.

Is a stock register mandatory under GST?

Stock accounting obligations apply under Rule 56 according to the taxpayer category and relevant provisions. Certain composition taxpayers have specific exceptions.

Are GST records required for a service company?

Yes. Registered service companies must maintain relevant supplies, tax, ITC and supporting records and comply with other applicable accounting obligations.

Is GST audit by a Chartered Accountant still mandatory?

The former mandatory CA/CMA GST audit requirement under Section 35(5) has been removed. Applicable annual-return and self-certified reconciliation obligations should be examined separately.

Where should GST records be maintained?

At the prescribed principal and additional places of business, with electronic accessibility and other conditions as required under Section 35 and the CGST Rules.

Can EzyBiz India assist with maintaining GST accounts?

Yes. We provide accounting, bookkeeping, reconciliation, GST return preparation and related compliance advisory under an agreed scope of services.

Mobile: +91 98992 17778
Email: anil@ezybizindia.in
WhatsApp: Speak with Our GST and Accounting Team

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Reviewed By: CA Anil Agrawal, Founder, EzyBiz India Consulting LLP.

Last Updated: October 2026.

Disclaimer: This article provides general information on accounts and records under GST in India and is not a substitute for transaction-specific tax, accounting or legal advice. The obligation to maintain prescribed records, applicable exemptions, electronic authentication, retention periods, record locations, reconciliation requirements and audit obligations depend on the taxpayer’s circumstances and the provisions in force at the relevant time. The former mandatory GST audit under Section 35(5) should not be confused with departmental audit, special audit or applicable self-certified reconciliation requirements. Businesses should review the current CGST Act, CGST Rules, notifications and official GST Portal instructions and obtain professional advice where appropriate.