Search for:
Key Income Tax Deadlines to Meet before March 31, 2025: Essential Compliance Guide

Key Income Tax Deadlines to Meet before March 31, 2025: Essential Compliance Guide

TALK TO EXPERTS

 

As the financial year 2024-25 nears its end, taxpayers—both individuals and businesses—must complete essential tax-related obligations before March 31, 2025. Failure to do so may result in interest penalties, additional tax liabilities, or disallowance of deductions, leading to unnecessary financial burdens. To stay compliant and avoid last-minute stress, it is crucial to understand and act upon the key tax requirements before the deadline.

Below is a detailed breakdown of the most critical tax obligations to fulfill before March 31, 2025 to ensure smooth financial operations and avoid legal consequences.

1. Payment of Balance Advance Income Tax to Avoid Interest Under Section 234B

Advance tax is applicable to individuals and businesses whose total income tax liability exceeds ₹10,000 in a financial year. To prevent interest charges under Section 234B, taxpayers must ensure that any outstanding balance of advance tax for FY 2024-25 is fully paid by March 31, 2025.

If a taxpayer fails to make advance tax payments or pays less than 90% of the total tax liability before the deadline, interest under Section 234B of the Income Tax Act is levied at 1% per month on the unpaid amount, beginning April 1, 2025, until the payment is made.

To avoid these additional costs, taxpayers should review their estimated income and tax liability and ensure all outstanding advance tax payments are settled before the deadline.

2. Tax-Saving Investments Under the Old Tax Regime for FY 2024-25

For those opting for the old tax regime, March 31, 2025, is the final opportunity to make tax-saving investments and claim deductions under various sections of the Income Tax Act. Some of the most effective tax-saving investments include:

  • Public Provident Fund (PPF) – Deduction under Section 80C (up to ₹1.5 lakh)
  • Life Insurance Premiums – Deduction under Section 80C
  • National Savings Certificate (NSC) – Deduction under Section 80C
  • Tax-Saving Fixed Deposits (FDs) – Deduction under Section 80C (5-year lock-in period)
  • Equity Linked Savings Scheme (ELSS) – Deduction under Section 80C
  • Employees’ Provident Fund (EPF) Contributions
  • Sukanya Samriddhi Yojana (SSY) – Applicable for parents of a girl child

Taxpayers who have opted for the new tax regime do not need to make these investments, as most deductions and exemptions are not available. However, for those sticking to the old tax regime, it is essential to ensure all eligible investments are made before March 31, 2025, to maximize tax benefits and reduce tax liability.

3. Clearing Outstanding Dues to Micro and Small Enterprises to Avoid Disallowance Under Section 43B

Businesses dealing with Micro and Small Enterprises (MSEs) must clear all outstanding dues for FY 2024-25 before March 31, 2025, to prevent disallowance under Section 43B(h) of the Income Tax Act.

Previously, businesses could claim expenses related to unpaid MSE dues if payments were made before the ITR filing due date. However, as per recent amendments, this benefit has been withdrawn—meaning businesses must settle payments within the financial year itself.

If outstanding dues remain unpaid beyond March 31, 2025, they will not be considered as an allowable business expense, leading to:

  • Higher taxable income
  • Increased tax liability
  • Cash flow issues for MSE suppliers

To avoid unnecessary financial and legal complications, businesses should ensure all payments to MSE vendors are settled before the end of March 2025.

4. Filing Updated ITR for AY 2022-23 With Additional 50% Tax and Interest

Taxpayers who missed declaring income or made errors in their original Income Tax Return (ITR) for Assessment Year (AY) 2022-23 (corresponding to FY 2021-22) have an option to file an Updated ITR (ITR-U). However, this comes with an additional tax liability.

To encourage voluntary compliance and discourage tax evasion, the Income Tax Department mandates taxpayers filing an Updated ITR for AY 2022-23 to pay an additional 50% of the aggregate tax and interest liability.

This provision allows taxpayers to correct any underreported income or mistakes in their returns without facing legal action. However, to take advantage of this opportunity and avoid severe penalties in the future, taxpayers must file their Updated ITR before March 31, 2025.

5. Filing Updated ITR for AY 2023-24 With Additional 25% Tax and Interest

Similarly, taxpayers who need to update their Income Tax Return for AY 2023-24 (corresponding to FY 2022-23) must file an Updated ITR before March 31, 2025. However, unlike AY 2022-23, the penalty is lower—taxpayers are required to pay an additional 25% of the aggregate tax and interest liability.

This provision benefits individuals and businesses that:

  • Forgot to report certain sources of income
  • Claimed ineligible deductions
  • Made calculation errors in tax liability

Filing the Updated ITR voluntarily before receiving a notice from tax authorities can help taxpayers rectify errors without facing strict legal consequences.

Shoplegal

Final Thoughts: Act Now to Avoid Penalties and Stay Compliant

As the March 31, 2025, deadline approaches, taxpayers must take proactive steps to complete their tax obligations on time. Here’s a quick checklist to ensure compliance:

✔ Settle any remaining advance tax payments to prevent interest penalties under Section 234B.
✔ Make tax-saving investments under the old regime (PPF, insurance, NSC, ELSS, etc.) to claim deductions.
✔ Clear all outstanding dues to Micro and Small Enterprises to prevent disallowance under Section 43B.
✔ File Updated ITR for AY 2022-23 with 50% additional tax and interest if applicable.
✔ File Updated ITR for AY 2023-24 with 25% additional tax and interest if necessary.

With only a few days remaining until March 31, 2025, timely tax planning and compliance will help taxpayers:

🔹 Maximize tax savings
🔹 Avoid unnecessary penalties
🔹 Ensure financial stability
🔹 Stay legally compliant

Taking action before the deadline ensures peace of mind and allows for better financial planning for the coming year. Don’t wait until the last minute—complete your tax filings and payments today!

Key GST Deadlines before March 31, 2025

Key GST Deadlines before March 31, 2025

TALK TO EXPERTS

 

As the financial year concludes, businesses and taxpayers must fulfill key GST-related obligations before March 31, 2025. Failing to meet these deadlines could lead to penalties, interest charges, or the loss of various tax benefits. To ensure compliance, here’s a comprehensive list of important tasks that need to be completed on the GST portal before the due date.

1. Opting for the Composition Scheme (Form CMP-02)

Small businesses wishing to benefit from the Composition Scheme for the financial year 2025-26 must submit Form CMP-02 through the GST portal. This scheme is specifically designed for businesses with lower turnovers, allowing them to pay GST at a reduced rate while minimizing their compliance obligations. The last date to apply is March 31, 2025. Businesses that fail to opt in by this date will have to follow the regular GST tax structure for the next financial year.

2. Declaration by Goods Transport Agencies (Annexure V/VI)

Goods Transport Agencies (GTAs) that wish to pay GST under either the Forward Charge Mechanism (FCM) or the Reverse Charge Mechanism (RCM) must submit their declaration using Annexure V or Annexure VI on the GST portal. This declaration specifies whether the GTA will collect and pay GST or if the recipient of the service will be liable to pay under RCM. The deadline for filing this declaration is March 31, 2025. Submitting it on time ensures the correct tax mechanism is applied for the next financial year.

3. Filing of LUT for Zero-Rated Supplies

Businesses engaged in exporting goods or services without paying IGST must file their Letter of Undertaking (LUT) for the financial year 2025-26 by March 31, 2025. The LUT allows exporters to continue making zero-rated supplies without having to pay GST upfront. If the LUT is not submitted on time, businesses may be required to pay IGST on exports and later claim refunds, leading to potential cash flow issues.

4. Annual Input Tax Credit (ITC) Re-Calculation Under Rule 42 for FY 2024-25

Taxpayers engaged in both taxable and exempt supplies are required to recompute their Input Tax Credit (ITC) annually under Rule 42 of the CGST Rules. This recalculation ensures that businesses accurately account for ITC adjustments, preventing excess credit claims and reducing the risk of interest liabilities. The annual re-computation process must be completed by April 1, 2025, to avoid any financial consequences due to miscalculations.

5. Submission of Annexure VII, VIII & IX for Restaurant Services

Restaurants and food service providers operating from specified premises must file Annexure VII, VIII, and IX on the GST portal before March 31, 2025, to either opt in or opt out of this classification. This classification determines their GST applicability and compliance obligations. Ensuring timely submission helps businesses correctly categorize their tax liabilities for the upcoming financial year.

6. Payment of Pending GST Dues Under the Amnesty Scheme

Taxpayers with outstanding GST dues from previous financial years can take advantage of the Amnesty Scheme under Section 128A of the CGST Act, 2017. This scheme provides waivers on interest and penalties for non-compliance in the financial years 2017-18, 2018-19, and 2019-20. To benefit from this relief, businesses must clear their pending GST dues before March 31, 2025. This presents a crucial opportunity for taxpayers struggling with past liabilities to settle them at a reduced cost.

Why Meeting the March 31, 2025 Deadline Is Important

With the financial year-end fast approaching, businesses must ensure they complete all necessary GST filings and payments on time. Timely compliance helps businesses:

✔ Avoid penalties and interest charges resulting from missed deadlines.
✔ Continue enjoying benefits such as the Composition Scheme and zero-rated exports under LUT.
✔ Prevent business disruptions due to regulatory non-compliance.
✔ Maintain healthy cash flow management by preventing unexpected tax burdens.

Final Thoughts

With only a short time left until March 31, 2025, businesses must act promptly to complete all GST-related compliances. Filing the required forms, declarations, and payments on time will help taxpayers avoid financial penalties and legal issues. By adhering to GST regulations and meeting deadlines, businesses can maintain compliance while benefiting from tax-saving schemes that promote a transparent and efficient financial system.

Firms with Rs 250 crore turnover rush to register on TReDS as March 31 deadline nears

Firms with Rs 250 crore turnover rush to register on TReDS as March 31 deadline nears

TALK TO EXPERTS

 

Companies with an annual turnover of ₹250 crore are rapidly enrolling on the Trade Receivables Discounting System (TReDS) platform to meet the MSME Ministry’s deadline of March 31, 2025. As per the government’s directive, all businesses with a turnover exceeding ₹250 crore, along with Central Public Sector Enterprises (CPSEs) that procure goods and services from Micro, Small, and Medium Enterprises (MSMEs), must complete their registration on the TReDS platform before the specified deadline.

Mandatory TReDS Registration for Large Businesses

At present, it is already compulsory for CPSEs and companies with an annual turnover exceeding ₹500 crore to register on the TReDS platform. However, a recent government notification has lowered the threshold to include enterprises with an annual turnover above ₹250 crore. This move aims to bring more large businesses under the regulatory framework, ensuring timely payments to MSMEs and improving financial efficiency in the ecosystem.

Understanding TReDS and Its Benefits

The Reserve Bank of India (RBI) introduced TReDS in 2015 to tackle the problem of delayed payments to MSMEs. Over the years, the platform has played a vital role in enhancing cash flow management for small businesses by facilitating faster settlements on favorable terms.

TReDS functions as a digital marketplace where MSMEs can sell their trade receivables—such as invoices and bills—to banks and financial institutions at a discounted rate. This mechanism allows small businesses to access working capital without waiting for extended payment cycles from large buyers. By ensuring a transparent and structured payment system, TReDS reduces financial stress on MSMEs and promotes smoother business transactions.

Why Large Enterprises Are Adopting TReDS

With the revised regulation in effect, large companies must register on the TReDS platform to remain compliant and avoid regulatory penalties. Apart from fulfilling legal requirements, registering on TReDS helps businesses build stronger relationships with their suppliers. Prompt payments foster trust, improve operational efficiency, and contribute to a healthier supply chain.

Additionally, enterprises complying with the TReDS mandate demonstrate their commitment to supporting MSMEs, which play a critical role in India’s economic development. The initiative aligns with the government’s broader objective of improving the ease of doing business and fostering financial inclusion for small and medium enterprises.

Conclusion

The government’s decision to extend the mandatory TReDS registration requirement to companies with a turnover exceeding ₹250 crore is a significant step toward strengthening the financial landscape for MSMEs. As the March 31, 2025, deadline draws near, more large businesses are swiftly registering on the platform to ensure compliance. By facilitating faster payments and enhancing cash flow for MSMEs, TReDS continues to be an essential tool in creating a more transparent and efficient business environment in India.