GST 2.0, one year on: a checklist for your business

What changed

• Two main rates. Following the 56th GST Council meeting in September 2025, most goods and services moved to a merit rate of 5% or a standard rate of 18%. The 12% and 28% slabs were largely folded into these.
• A 40% special rate for a short list of luxury and sin goods.
• Compensation cess ended for most goods. For tobacco products, the earlier GST and cess rates continue until a date the government notifies.
• Some supplies became exempt, including individual life and health insurance premiums.

What to check

• Item masters. Make sure HSN / SAC codes and rates in your billing software match the new rates. Start with your 20 highest-value items.
• Invoices around the changeover. Advances, credit notes and invoices issued after 22 September 2025 for earlier supplies depend on time-of-supply rules. Check they used the right rate.
• Input tax credit. If your sales moved to 5% but your inputs stayed at 18%, credit may build up. Under an inverted duty structure that credit can be claimed as a refund, so track it monthly.
• Contracts and price lists. Long-term contracts that quote "plus GST at 12%" or "inclusive of GST" need updating.
• Price changes. If your rate fell, keep a record of how your prices changed. The government has stressed that rate cuts should reach customers.
• Annual return. GSTR-9 for 2025-26 (normally due 31 December 2026) covers both rate structures, so a rate-wise reconciliation of turnover and credit matters more than usual.

How we help

Our Pune team handles GST registration, monthly and quarterly returns, annual returns and reconciliations, and notices. If you'd like a rate and input-credit check before your annual return, talk to us.

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