Annual Compliance Checklist Before March 31: Every Business Must Complete

March 31 is not just the end of the financial year. It is a compliance cliff where dozens of deadlines converge for every business operating in India. From advance tax payments due March 15 to GST reconciliation, ITC reversal, investment proof submission, TDS deductions, ROC filings verification, and LUT renewals for exporters, the final weeks of March determine whether your business enters the new financial year clean or carrying penalties. This checklist covers every critical compliance item for Private Limited Companies, LLPs, OPCs, and sole proprietors, with exact deadlines, penalty amounts, and action steps.

Income Tax Compliance Before March 31

Income tax compliance items are the most time-sensitive, with the advance tax deadline falling on March 15, a full 16 days before the financial year ends. Missing these creates immediate financial penalties.

Advance Tax: March 15 Deadline

The fourth and final instalment of advance tax is due by March 15, 2026. By this date, you must have paid 100% of your estimated tax liability for FY 2025-26. The instalment schedule is:

Tax-Saving Investments: Last Date March 31

All tax-saving investments and payments eligible for deductions must be completed and paid by March 31, 2026. Investments made on April 1 or later count for the next financial year. Key deduction sections:

• Section 80C (₹1.5 lakh limit): PPF, ELSS mutual funds, NSC, tax-saving FDs, life insurance premium, Sukanya Samriddhi, SCSS
• Section 80D (₹25,000 to ₹1 lakh): Health insurance premium for self, family, and parents
• Section 80CCD(1B): Additional ₹50,000 NPS contribution
• Section 80G: Donations to approved charitable institutions
• Section 80E: Education loan interest (no upper limit)

GST Year-End Compliance

GST-registered businesses have several critical year-end tasks that directly impact the accuracy of annual returns and potential tax liability.

ITC Reconciliation and Reversal

Before March 31, reconcile your Input Tax Credit (ITC) claims with the GSTR-2B auto-populated data. Any ITC claimed on purchases not reflected in GSTR-2B must be reversed. Similarly, ITC on ineligible items (personal use, exempt supplies, blocked credits under Section 17(5)) must be reversed using Rule 42 and Rule 43 formulas.

GSTR-1 and GSTR-3B Reconciliation

Ensure that GSTR-1 (outward supplies) matches your sales register and that GSTR-3B (tax payment) reconciles with GSTR-1. Discrepancies between these returns trigger notices and can affect your buyers' ITC eligibility. Fix any mismatches in the February and March returns.

LUT Renewal for Exporters

If you export goods or services, your Letter of Undertaking (LUT) expires on March 31, 2026. File a new LUT in Form GST RFD-11 on the GST portal before April 1 to ensure your April exports remain zero-rated. Without a valid LUT, you must pay IGST on exports and claim refund later, creating cash flow strain.

E-Way Bill Reconciliation

Reconcile all e-way bills generated during the year with actual tax invoices and dispatch records. Unmatched e-way bills (generated but not followed by invoices, or invoices without corresponding e-way bills) create audit risk during GST scrutiny.

Company and LLP Compliance Verification

While most MCA filings have their own specific deadlines throughout the year, March 31 is the right time to audit your overall compliance status and catch any missed filings before penalties accumulate further.

ROC Filing Status Check

Verify the following filings are up to date for your Private Limited Company or OPC:

LLP Compliance Verification

For LLPs, verify these filings:

• Form 8 (Statement of Account and Solvency): Due within 30 days of 6 months from FY end (October 30)
• Form 11 (Annual Return): Due within 60 days from FY end (May 30)
• Form 3 (LLP Agreement): Filed within 30 days of any change
• DIR-3 KYC: For all designated partners holding DIN

TDS Year-End Compliance

TDS compliance requires attention both before and immediately after March 31. The key dates are:

• March 31: Deduct TDS on all March payments (salary, rent, professional fees, contractor payments)
• April 7: Deposit March TDS with the government
• May 31: File Q4 TDS returns (Form 24Q for salary, 26Q for non-salary)
• June 15: Issue annual TDS certificate Form 130 (previously Form 16) to employees

Payroll and Employee Compliance

Investment Proof Collection

Ensure all employees have submitted investment proofs for 80C, 80D, HRA, home loan interest, and other deductions. Most companies set an internal deadline of February 15 to March 10. Without proofs, the March salary TDS calculation will use the higher rate without deductions, causing employee dissatisfaction.

PF and ESI Contributions

March PF and ESI contributions must be deposited by April 15. Ensure the March payroll is processed in time to compute accurate contributions. Late PF deposit attracts interest at 12% per annum and damages at 5% to 25% of the delayed amount.

Professional Tax

If applicable in your state (Maharashtra, Karnataka, West Bengal, etc.), ensure professional tax for March is deducted from employee salaries and deposited by the state-specific deadline (usually the month-end or the 15th of the following month).

Financial Closure and Documentation

Beyond regulatory compliance, businesses should complete these financial closure activities before March 31:

1. Physical stock verification: Count and value all inventory as of March 31
2. Bank reconciliation: Reconcile all bank accounts with books by March 31
3. Accounts receivable review: Identify and write off bad debts (deductible under Section 36(1)(vii))
4. Fixed asset register: Update with additions, disposals, and depreciation for the year
5. Inter-company reconciliation: If you have group entities, reconcile all inter-company balances
6. Expense accruals: Record all accrued but unpaid expenses (salary, rent, utilities, professional fees)
7. Revenue recognition: Ensure revenue is recognised in the correct financial year per Ind AS / AS standards

Complete Compliance Checklist (Printable)

Summary

March 31 is the most compliance-intensive day on the Indian business calendar. With advance tax (March 15), GST reconciliation, ITC reversals, LUT renewals, TDS deductions, ROC filing verification, and tax-saving investments all converging, a structured checklist is essential. Missing any of these deadlines triggers automatic penalties: 1% per month for advance tax, ₹200/day for TDS returns, ₹100/day for ROC filings, and potential ITC denial for GST mismatches. Complete each item in this checklist before March 31, 2026, and start the new financial year penalty-free. For end-to-end compliance management, IncorpX handles everything from filing to follow-up.