Mistakes Taxpayers Must Avoid During GST Online Verification on the Portal
This blog post highlights common mistakes to avoid and offers practical solutions to ensure smooth and reliable GST verification. The aim is to help traders, retailers, distributors, and service providers complete the verification process with confidence while remaining fully compliant with GST rules applicable in their respective states.
Checklist of GST Online Mistakes Taxpayers Must Avoid
In today’s digital environment, many businesses fail to perform basic checks while validating their suppliers, which often leads to issues during audits and monthly return filings. Some common errors are outlined below.
- Entering supplier details regarding using outdated or incorrect legal names.
- Not checking the status code on the portal before issuing invoices.
- Entering incorrect state codes during purchase entries.
- Not validating the GSTIN format before saving it in accounting software.
A Surat-based textile unit continued transactions with a partner whose GST registration had become inactive. The issue was discovered only during a departmental inquiry, causing unnecessary stress. A careful review of all details beforehand could have prevented this problem.
Why Overlooking Government Portal Status Can Severely Impact Compliance Signals
Failing to Verify the Latest Status
Real-time status updates on the GST portal are vital for staying compliant. Yet, many tax professionals zero in on the GSTIN and miss the activity flag. When verifying, taxpayers can easily overlook key details like:
- Suppliers receive notices directly through the portal.
- Remarks from the website moderator, such as suspended or flagged comments.
- If there are dues to be paid for the records, the registration can be canceled.
- A record of filed returns and any delays, as displayed on the dashboard.
A supplier based in Pune continued to receive repeated orders from a wholesale grocery dealer despite having their GST registration cancelled. The dealer placed these orders based on outdated information saved months earlier, without verifying the supplier’s current GST status. This situation highlights the risks of relying on old data, which can lead to non-compliant transactions and potential input tax credit issues. To prevent such problems, businesses should always check the GST portal for the latest registration status of suppliers before placing any major order.
Skipping Location and Activity Checks
GST verification is not limited to checking the validity of the GSTIN. Taxpayers should also ensure that the supplier’s declared nature of business aligns with the specific goods or services being procured. Engaging with a supplier whose GST registration does not cover the relevant goods or services may result in denial of input tax credit and potential compliance issues. Therefore, a thorough review of the supplier’s GST details on the portal is essential before finalizing significant transactions.
- The invoice does not align with the business activity declared on the GST portal.
- The invoice shows a location different from the principal place of business.
- It has been observed that large distributors frequently fail to register their additional places of business.
- The Harmonized System of Nomenclature (HSN) or Services Accounting Codes (SAC) mentioned do not match the goods or services being billed.
A Chennai electronics dealership faced an Input Tax Credit (ITC) blocking issue because their supplier's registered field of activity bore no relation to the electronic items being sold. A brief, simple review of the supplier's registered business activities would have prevented this critical mismatch.
Read Also: How Modern GST Software Keeps Your Financial Data Safe
PAN Records Not Matching Correctly
Many taxpayers rely on GSTINs obtained through verbal communication or old purchase bills without proper validation. As a result, they fail to conduct thorough checks during verification, leading to several important details being overlooked, such as:
- Always Check if the GSTIN Prefix Corresponds to the Entity's PAN
- A common data entry error is the misspelling of the supplier's legal name when recording transactions or details.
- A common cause of filing mismatches occurs when an entity’s trade name is mistakenly used instead of its legally registered name in records.
- The Misrepresentation of Temporary IDs and Registrations as Valid GSTINs
Reconciliation issues often stem from small but critical errors, such as spelling mistakes. For example, a furniture retailer in Nagpur faced return mismatches and the risk of notices because a single spelling error in a supplier’s legal name was repeated across multiple entries. Correcting that one error promptly resolved the entire issue.
Final Confirmation on the Circumstances for Not Using the GST Portal
Due to the verification complexities, many taxpayers rely entirely on screenshots provided by vendors or accountants, significantly increasing the potential for human error and data inaccuracy.
- Data may be outdated.
- GST Portal Updates are Not Consistent in Older Screenshots
- Incorrect assumptions may be made because of partial visibility.
- The historical compliance notes are hidden within screenshots.
A chemical distributor in Vadodara was misled by a screenshot showing a supplier’s GST status as “Active.” However, the official GST portal had already marked the supplier as “Suspended” due to non-filing. This incident highlights the importance of relying on direct, real-time portal verification for accurate compliance data.
The Risk of Failing to Carefully Check Address Details
Small address-level errors often go unnoticed, but they can turn into major issues during assessments or cross-verification. Some common address-related mistakes include:
- Mismatch Between Registered State and Utilized State Code
- Entering Branch Office Details Where Main Office Information is Required
- Missing Unit Numbers in Documentation for Multi-Warehouse Setups
- Overlooking Additional Places of Business in Compliance Documentation
A courier partner in Hyderabad once used warehouse details instead of the primary registered address, which caused a mismatch during e-way bill generation. A simple review of the address fields could have resolved the issue immediately.
The Final Verdict
Across India, taxpayers frequently underestimate how severely small errors during GST online verification, such as a wrong digit, an outdated status, or a missed portal alert, can impact compliance. To prevent costly Input Tax Credit (ITC) mismatches and audit issues, maintain accurate records and build trust by always verifying every detail directly on the official GST portal, rather than making assumptions.