What is GSTR-6?

Importance of GSTR-6

The GSTR-6 return plays a vital role in ensuring the correct distribution of Input Tax Credit among various branches of an organization. The precise allocation of ITC protects the business from duplicate credit claims and lowers taxation while streamlining credit movement throughout organization locations. The system enhances visibility and tracks service utilization across different company locations. Companies must file GSTR-6 accurately because it helps keep their records clean and minimizes the risk of receiving compliance notices amidst increased GST audits.

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The rules regarding ISD have become stricter starting April 1, 2025. Auto-populated ITC details, cross-verification with GSTR-1 and GSTR-2B, and increased audit scrutiny have made timely and precise filing essential. Mismatches or errors can now directly impact the recipient branch’s ability to claim ITC, making internal coordination and record-keeping more critical than ever.

Pre-requisites for Filing GSTR-6

Before you begin filing GSTR-6, make sure you have these basics in place:

• A valid GSTIN (GST registration number) issued to the Input Service Distributor (ISD)
• The legal name and trade name of your business as registered under GST
• The return period – that is, the month and year you’re filing for
• Details of Input Tax Credit (ITC) you’ve received and how you plan to distribute it
• Any debit or credit notes issued during the period

GSTR-6 Filing Process

Filing GSTR-6 is an online process through the GST portal. Here’s a step-by-step guide:

1. Log in to the GST portal using ISD credentials.
2. Go to ‘Services > Returns > Returns Dashboard and select the financial year and month.
3. Click on ‘Prepare Online’ under GSTR-6.
4. Enter details of ITC received, distributed, and any debit/credit notes.
5. Use auto-populated data where available, cross-verify with invoices, and click ‘Proceed to File’
6. Save the form and preview the summary.
7. Submit using Digital Signature Certificate (DSC) or Electronic Verification Code (EVC).
8. If any late fee is applicable, pay it before final submission

There are two modes for signing and filing GSTR-6:

1. Digital Signature Certificate (DSC)
• Only PAN-based Class II or III DSCs are accepted by the GST Portal
• Used for secure and verifiable digital authentication
2. Electronic Verification Code (EVC)
• A one-time password (OTP) sent to the registered mobile of the authorized signatory
• Used to verify and submit the return digitally

Alternatively, ISDs can also use the offline utility tool provided by the GSTN for bulk upload of invoice data, which is especially helpful for large enterprises with multiple branches.

What is GSTR-6A?

GSTR-6A is an auto-drafted read-only form based on supplier data in GSTR-1. ISDs can’t make changes directly to GSTR-6A. Any corrections must be made during the GSTR-6 filing process itself.

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Conclusion

With GST regulations becoming more time-sensitive, GSTR-6 compliance is non-negotiable for Input Service Distributors. Accurate and timely filing ensures the smooth distribution of ITC across multiple units, helping businesses manage their tax credit efficiently.

Filing GSTR-6 on time also contributes to better vendor relationships, easier audits, and minimized tax disputes. For growing enterprises, using advanced GST software solutions like BUSY can greatly reduce the risk of errors and automate ITC reconciliation for GSTR-6 filings. As businesses gear up for increased scrutiny post-April 2025, maintaining consistent GST return discipline is more important than ever.