GST Audit Checklist: Complete Guide

GST Audit Checklist: Complete Guide for Businesses

Table of Contents:-

A comprehensive GST Audit Checklist helps businesses review their GST compliance, reconcile returns with books of account and identify potential tax exposures before or during a departmental GST audit.

Under the current GST framework, departmental audit may be conducted by GST authorities under Section 65 of the CGST Act, 2017. A Special Audit may also be directed under Section 66 in specified circumstances.

The earlier mandatory turnover-based GST audit by a Chartered Accountant or Cost Accountant has been discontinued. However, businesses may still face departmental audits, scrutiny, investigations and other GST proceedings.

A periodic internal GST compliance review can therefore help identify discrepancies before they result in departmental queries.

Businesses requiring professional assistance can refer to our GST Audit Services in India.

What is a GST Audit Checklist?

A GST audit checklist is a structured list of GST records, returns, reconciliations and compliance areas that should be examined while preparing for a GST departmental audit or conducting an internal GST review.

The checklist helps determine whether:

GST registrations are correct;
outward supplies have been properly reported;
GST liability has been correctly discharged;
input tax credit is eligible and properly supported;
GST returns reconcile with books of account;
reverse charge liability has been discharged;
GST rates and classifications are correct;
place-of-supply provisions have been properly applied;
exports and imports are correctly reported; and
adequate supporting documents have been maintained.

The books and records required under GST are prescribed under the CGST Act and Rules. Businesses can refer to the CBIC provisions on GST Accounts and Records.

GST Audit Checklist at a Glance

Before starting a detailed GST review, businesses should broadly examine the following areas:

GST registration;
books of account;
outward supplies;
GSTR-1;
GSTR-3B;
turnover reconciliation;
input tax credit;
GSTR-2B reconciliation;
blocked credits;
reverse charge;
tax invoices;
debit and credit notes;
HSN/SAC classification;
GST rates;
valuation;
place of supply;
exports and zero-rated supplies;
imports;
e-way bills;
job work;
related-party transactions;
branch transfers;
refunds;
annual return and GSTR-9C, wherever applicable; and
reconciliation with financial statements.

The detailed checklist is explained below.

1. GST Registration Checklist

Verify the GST registration details of the business.

Check whether:

GST registration has been obtained wherever required;
registrations have been obtained in all applicable States/UTs;
legal name and trade name are correct;
principal place of business is correctly mentioned;
additional places of business are updated;
nature of business activities is correctly stated;
authorised signatory details are current;
bank account and other relevant particulars are updated; and
amendments have been filed wherever required.

Registration discrepancies should be corrected before they become an issue during departmental verification.

For further guidance, refer to our GST Registration Procedure Guide.

2. Books of Account and Records Checklist

Verify whether appropriate books and supporting records are being maintained.

Important records may include:

sales register;
purchase register;
general ledger;
trial balance;
expense ledgers;
stock records;
fixed asset register;
tax invoices;
bills of supply;
debit notes;
credit notes;
delivery challans;
receipt vouchers;
payment vouchers;
refund records;
e-way bills;
import documents; and
export documents.

GST records should be capable of reconciliation with GST returns and financial statements.

The CBIC Accounts and Records Rules provide official guidance on records to be maintained by registered persons.

3. GSTR-1 Checklist

Review outward supplies reported in GSTR-1.

Check whether:

all taxable sales have been reported;
B2B invoices contain correct GSTIN;
B2C supplies are appropriately reported;
inter-State and intra-State supplies are correctly classified;
export invoices are properly reported;
credit notes and debit notes are included;
amendments are correctly reflected;
exempt and nil-rated supplies are properly disclosed; and
invoice values agree with the sales register.

Differences between books and GSTR-1 should be reconciled and documented.

4. GSTR-3B Checklist

Review the tax liability and input tax credit reported in GSTR-3B.

Verify:

taxable turnover;
output GST liability;
exempt and nil-rated supplies;
zero-rated supplies;
reverse charge liability;
eligible ITC;
ITC reversals;
tax paid through electronic cash ledger;
tax paid through electronic credit ledger; and
interest or other liability, wherever applicable.

GSTR-3B should also be reconciled with GSTR-1 and the books of account.

5. GSTR-1 vs GSTR-3B Reconciliation

Compare outward supplies reported in GSTR-1 with liability reported in GSTR-3B.

Check differences arising from:

invoices omitted from either return;
amendments;
credit notes;
debit notes;
timing differences;
export transactions;
advances, where applicable; and
incorrect reporting periods.

Material unreconciled differences can attract departmental queries.

6. Turnover Reconciliation with Books

Reconcile GST turnover with the sales ledger, trial balance and financial statements.

The reconciliation should consider:

taxable sales;
exempt supplies;
zero-rated supplies;
exports;
branch transfers;
related-party supplies;
deemed supplies;
credit notes;
debit notes;
advances;
unbilled revenue;
other operating income; and
miscellaneous income having GST implications.

Differences between financial turnover and GST turnover should be properly explained.

7. Input Tax Credit Checklist

Input tax credit is one of the most important areas of GST review.

Verify whether:

ITC relates to business purposes;
valid tax invoices or prescribed documents are available;
goods or services have been received;
applicable statutory conditions have been complied with;
blocked credits have not been claimed;
required reversals have been made;
RCM-related ITC is appropriately claimed;
capital-goods ITC is correctly treated; and
ITC relating to exempt supplies has been appropriately considered.

The eligibility conditions should be examined under the law applicable to the relevant tax period.

For official GST provisions and updates, refer to the CBIC GST website.

8. GSTR-2B vs Purchase Register Reconciliation

Reconcile ITC as per the purchase register with GSTR-2B.

Identify:

invoices appearing in books but not GSTR-2B;
invoices appearing in GSTR-2B but not books;
duplicate invoices;
incorrect GSTIN;
incorrect invoice number;
incorrect tax amount;
credit notes;
cancelled invoices;
vendor reporting errors; and
ITC requiring reversal or follow-up.

Unlike the old article’s focus on GSTR-2A, current compliance review should give appropriate attention to GSTR-2B and the applicable statutory ITC conditions.

9. Blocked Input Tax Credit under Section 17(5)

Review expenses that may attract restrictions under Section 17(5).

Depending upon the facts, review may be required for:

motor vehicles;
food and beverages;
club and membership expenses;
works contract services;
construction-related expenses;
goods or services used for personal consumption;
gifts and free samples; and
other restricted credits.

Each item should be examined based on the applicable statutory provision and exceptions.

10. ITC Reversal Checklist

Review whether ITC reversals have been made wherever required.

Important areas may include:

exempt supplies;
non-business use;
blocked credits;
supplier-related statutory conditions;
credit notes;
goods lost, stolen, destroyed or written off;
gifts and free samples; and
other reversals prescribed under GST law.

The amount and timing of reversals should be supported by appropriate workings.

11. Reverse Charge Mechanism Checklist

Review expenses and transactions potentially liable under Reverse Charge Mechanism.

Verify:

whether the transaction attracts RCM;
applicable GST rate;
time of supply;
tax payment;
reporting in GSTR-3B;
documentation; and
subsequent ITC claim, wherever eligible.

Special attention may be required for import of services and other notified transactions.

12. Tax Invoice Checklist

Check whether tax invoices contain prescribed particulars.

Review:

supplier name and GSTIN;
invoice number;
invoice date;
recipient details;
recipient GSTIN;
HSN/SAC;
description;
taxable value;
GST rate;
CGST/SGST/IGST amount;
place of supply, wherever applicable; and
other prescribed particulars.

Also verify whether invoices are issued within the applicable time limits.

13. Debit Note and Credit Note Checklist

Review debit and credit notes issued or received during the year.

Check:

reason for issuance;
linkage with original transaction;
tax impact;
reporting in GST returns;
corresponding accounting entry; and
impact on input tax credit, wherever applicable.

Ensure that the treatment in books and GST returns is consistent.

14. HSN/SAC Classification Checklist

Review classification of major goods and services.

Verify:

correct HSN for goods;
correct SAC for services;
applicable GST rate;
exemption notifications;
concessional rates;
composite supplies;
mixed supplies; and
changes in classification or rate during the relevant period.

The applicable GST rate and classification should always be checked against the law and notifications applicable to the relevant transaction.

15. GST Rate Checklist

Verify whether the correct GST rate has been charged.

Pay particular attention to:

newly introduced products or services;
rate changes;
concessional-rate transactions;
exemptions;
composite supplies;
mixed supplies; and
transactions where classification is disputed.

Current GST rate information may be checked through the CBIC GST Rates resources.

16. Place of Supply Checklist

Place of supply determines whether CGST/SGST or IGST should generally apply.

Review:

location of supplier;
location of recipient;
nature of supply;
inter-State transactions;
intra-State transactions;
services relating to immovable property;
performance-based services;
transportation;
intermediary arrangements;
cross-border services; and
other transactions governed by specific place-of-supply rules.

Incorrect place-of-supply treatment can result in payment of the wrong type of GST.

17. Export of Goods and Services Checklist

For export transactions, review:

export invoices;
shipping bills;
LUT, wherever applicable;
IGST payment, where relevant;
foreign inward remittance documentation;
conditions for export of services;
place of supply;
zero-rated treatment;
refund claims; and
reconciliation with GST returns.

Exporters should maintain complete documentary support for zero-rated supplies.

For refund-related assistance, refer to our GST Refund Services in India.

18. Import Checklist

Review import transactions with:

bills of entry;
customs documents;
IGST paid on import of goods;
ITC claimed;
import of services;
RCM liability;
related-party imports;
foreign currency payments; and
reconciliation with books.

Import-related ITC should be appropriately supported and reconciled.

19. E-Way Bill Checklist

Review whether e-way bills have been generated wherever applicable.

Check:

invoice number;
invoice date;
taxable value;
GSTIN;
place of dispatch;
place of delivery;
vehicle details;
validity;
cancellation, wherever applicable; and
reconciliation with sales and dispatch records.

The e-way bill details should broadly correspond with the underlying invoice and movement of goods.

For further guidance, refer to our E-Way Bill under GST.

20. Job Work Checklist

Businesses sending goods for job work should review:

movement of goods;
delivery challans;
job-worker details;
applicable GST reporting;
ITC implications;
goods returned from job worker;
goods supplied directly from job worker’s premises; and
statutory time limits applicable to inputs and capital goods.

The old transitional GST provisions relating specifically to stock lying with job workers as of June 2017 are no longer useful for a current general GST audit checklist and should not form part of the present checklist.

21. Related-Party Transaction Checklist

Review supplies between related parties and distinct persons.

Examples may include:

transactions between branches in different States;
intercompany services;
management charges;
cross-charges;
head-office allocations;
supplies between related companies; and
transactions with foreign group entities.

Verify valuation, invoicing, place of supply and tax treatment.

22. Branch Transfer Checklist

Where a business has multiple GST registrations, review transactions between distinct persons.

Check:

invoices;
valuation;
GST payment;
ITC at recipient location;
allocation of common services;
movement of goods; and
reconciliation between branch accounts.

23. GST Refund Checklist

For businesses claiming GST refunds, verify:

eligibility of refund;
relevant period;
refund computation;
turnover;
input tax credit;
export documents;
LUT;
shipping bills;
foreign remittances;
supporting statements;
invoices;
electronic ledgers; and
reconciliation with GST returns.

Businesses preparing a refund application can also read our guide on Tips for Uploading Documents at the Time of GST Refund.

24. Annual Return and GSTR-9C Checklist

Where applicable, review annual GST compliance.

Check:

GSTR-9 applicability;
GSTR-9C applicability;
turnover reconciliation;
tax liability;
ITC;
previous-year adjustments;
financial statement reconciliation; and
disclosures required in the applicable forms.

Under the present framework, GSTR-9C is a self-certified reconciliation statement for taxpayers to whom the prescribed requirement applies. The earlier CA/Cost Accountant certification regime has been discontinued.

25. Financial Statement Reconciliation

Reconcile GST returns with the final financial statements.

Important areas include:

revenue from operations;
other income;
purchases;
expenses;
fixed assets;
advances;
receivables;
payables;
GST liability;
input tax credit;
exports;
imports; and
branch transactions.

Every material difference should have an identifiable reason and supporting documentation.

26. Electronic Ledger Checklist

Review GST electronic ledgers, including:

electronic liability register;
electronic credit ledger; and
electronic cash ledger.

Verify whether:

tax payments are correctly reflected;
ITC utilisation is appropriate;
cash deposits reconcile with books;
outstanding liabilities are identified; and
adjustments and refunds are properly accounted for.

27. GST Interest and Late Fee Checklist

Check whether interest or late fee became payable because of:

delayed tax payment;
delayed filing of returns;
incorrect tax treatment;
ITC-related adjustments; or
other applicable defaults.

Any liability should be computed with reference to the provisions applicable to the relevant period.

28. GST Departmental Audit Documents Checklist

Where a business receives a departmental audit notice, the following documents should ordinarily be kept ready depending upon the scope of the notice:

GST registration certificates;
GSTR-1;
GSTR-3B;
annual returns;
GSTR-9C, wherever applicable;
trial balance;
general ledger;
audited financial statements;
sales register;
purchase register;
expense ledgers;
fixed asset register;
GSTR-2B reconciliation;
ITC workings;
RCM workings;
tax invoices;
debit notes;
credit notes;
e-way bills;
export documents;
import documents;
refund records;
agreements and contracts; and
other documents specifically requested by the audit authorities.

The exact documents required will depend upon the business and issues under examination.

GST Departmental Audit under Section 65

Under Section 65 of the CGST Act, the Commissioner or an authorised officer may undertake audit of a registered person.

The taxpayer is required to receive prescribed prior notice. During audit, the authorised officer may require access to books and records and seek information necessary for completing the audit.

The Act provides a statutory framework for the time for completion of audit and communication of findings.

For a detailed understanding of the departmental structure, refer to Functions of GST Audit Commissionerate.

What Happens When GST Audit Finds a Discrepancy?

During departmental audit, discrepancies may be communicated to the taxpayer for explanation.

The taxpayer should:

understand the precise observation;
reconcile the relevant data;
verify the legal position;
prepare supporting workings;
collect documentary evidence; and
submit a properly reasoned response.

Under the GST Rules, audit findings are communicated in the prescribed manner, including FORM GST ADT-02 on conclusion of a Section 65 audit.

Where significant issues are involved, professional assistance may help prevent factual reconciliation differences from unnecessarily developing into tax disputes.

How EzyBiz Assists with GST Audit Preparation

EzyBiz India Consulting LLP assists Indian and foreign-owned businesses with GST audit preparation and compliance reviews.

Our assistance may include:

review of GST audit notice;
GST audit checklist preparation;
document compilation;
GSTR-1 vs GSTR-3B reconciliation;
turnover reconciliation;
GSTR-2B and ITC reconciliation;
blocked-credit review;
RCM review;
HSN/SAC and GST-rate review;
place-of-supply review;
export and import review;
e-way bill review;
financial statement reconciliation;
preparation of explanations and workings;
response to audit observations; and
representation support.

For comprehensive assistance, refer to our GST Audit Services in India.

Frequently Asked Questions

Is GST audit mandatory based on turnover?

The earlier mandatory turnover-based GST audit by a Chartered Accountant or Cost Accountant has been discontinued.

Departmental audit under Section 65 and Special Audit under Section 66 continue under the GST framework.

Who conducts GST departmental audit?

Under Section 65, the Commissioner or an officer authorised by the Commissioner may undertake the audit of a registered person.

What is the most important GST audit reconciliation?

There is no single reconciliation applicable to every business. However, important areas generally include GSTR-1 vs GSTR-3B, GST turnover vs books/financial statements, and input tax credit vs purchase records and GSTR-2B.

Is GSTR-2A or GSTR-2B used for ITC review?

For a current GST compliance review, businesses should focus on the statutory ITC conditions applicable to the relevant period and undertake appropriate reconciliation with GSTR-2B rather than relying on the older GSTR-2A-focused approach contained in historical GST audit articles.

What documents are required for GST departmental audit?

The documents depend upon the audit notice and business, but commonly include GST returns, financial statements, ledgers, sales and purchase registers, invoices, ITC reconciliation, GSTR-2B records, e-way bills and supporting export/import documentation.

How much notice is given before audit under Section 65?

Section 65 provides that the registered person should be informed by notice not less than 15 working days prior to the conduct of audit.

How long can a GST departmental audit take?

Section 65 provides for completion within three months from commencement of audit, with provision for extension by the Commissioner for reasons recorded in writing by a further period not exceeding six months.

What happens after completion of GST audit?

The proper officer is required to communicate the findings, rights and obligations and reasons for the findings to the registered person within the statutory framework prescribed under Section 65.

Related Services

GST Audit Services in India – Professional assistance with GST departmental audits, internal compliance reviews, reconciliations and audit observations.
Functions of GST Audit Commissionerate – Understand the role, functions and audit process followed by GST departmental authorities.
Who Can Do GST Audit in India? – Guidance on departmental audit under Section 65 and Special Audit under Section 66.
Can Statutory Auditor Do GST Audit? – Explanation of the current GST audit framework and the role of statutory auditors.
GST Refund Services in India – Assistance with GST refund computation, documentation, filing and departmental follow-up.
GST & Indirect Tax Advisory and Litigation Services – Comprehensive GST advisory, compliance, audit, assessments, refunds, appeals and litigation support.
Tax and Regulatory Advisory Services in India – Integrated tax and regulatory advisory, compliance and litigation services.

Need Assistance with GST Audit?

A structured GST compliance review can identify return mismatches, ITC issues, RCM exposures, classification errors and documentation gaps before or during departmental audit.

EzyBiz India Consulting LLP assists businesses with GST audit preparation, reconciliations, documentation and responses to GST authorities.

Need Professional Business Advisory Support?

Speak with our experienced professionals for practical assistance with your business, tax and regulatory requirements in India.

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Prepared By:
EzyBiz India Consulting LLP

Last Updated: August 2026

Disclaimer:
This page provides general information and a broad GST audit checklist. The checklist is not exhaustive, and the requirements applicable to a taxpayer depend upon its business, transactions, tax period and applicable GST provisions. Professional advice should be obtained based on the specific facts and circumstances.