Short answer: the late fee accrues per day, but it is capped, and for most small businesses the cap is the number that matters. For tax periods from June 2021 onwards the late fee is waived above ₹250 where the tax payable is nil, ₹1,000 where turnover is up to ₹1.5 crore, and ₹2,500 where turnover is above ₹1.5 crore and up to ₹5 crore — each of those under the CGST Act, with an equivalent amount under your State GST Act, so the practical total is double. Interest on unpaid tax is separate, and is not capped.
Where the fee comes from
Two layers, and confusing them is why people arrive at wildly different numbers.
Layer one — the Act. Section 47(1) of the CGST Act, 2017 provides that a registered person who fails to furnish returns under section 39 by the due date
> shall pay a late fee of one hundred rupees for every day during which such failure continues subject to a maximum amount of five thousand rupees.
That is the statutory position: ₹100 per day, capped at ₹5,000, under the CGST Act — mirrored under the State Act.
Layer two — the notifications. The Government has repeatedly used its power under section 128 to waive part of that fee. The reduced per-day rate and the caps below both come from notifications, not from the Act itself. This is the layer that changes, and it is why a number you read on a blog from two years ago may simply be wrong now.
The caps that apply now
Notification No. 19/2021–Central Tax, dated 1 June 2021, amending Notification No. 76/2018–Central Tax, provides that for the tax period June 2021 onwards the total late fee under section 47 stands waived in excess of:
| Class of registered person | Cap (CGST) | Practical total with SGST |
|---|---|---|
| Total central tax payable in the return is nil | ₹250 | ₹500 |
| Aggregate turnover up to ₹1.5 crore in the preceding financial year | ₹1,000 | ₹2,000 |
| Aggregate turnover above ₹1.5 crore and up to ₹5 crore | ₹2,500 | ₹5,000 |
Above ₹5 crore of turnover the notification’s table does not apply, and the section 47 cap of ₹5,000 under the CGST Act governs — ₹10,000 in practice once the State Act is counted.
The “practical total” column reflects that an equivalent notification is issued under each State GST Act. The central notification itself speaks only to central tax.
> The single most useful thing on this page: a nil return, filed years late, costs ₹500 in late fee. Not tens of thousands. People avoid filing because they have imagined a number far larger than the real one, and the avoidance is what turns a small problem into a large one.
What the per-day rate is
The Act says ₹100 per day. A lower per-day rate has been notified and is what the portal actually charges, but the reduced figure has moved more than once by notification, so we will confirm the rate applying to your period rather than print one here that may have changed. In practice it rarely matters: on anything more than a few weeks late, you hit the cap and the per-day rate stops being the operative number.
A nil return is still a return
This is the trap, and it catches almost everyone who registers and then does not trade.
If you registered for GST and had no outward supplies, you still file. The obligation attaches to the registration, not to the activity. The late fee accrues on a nil return exactly as it does on a live one — at a lower rate, and capped at ₹500 in total, but it accrues, every period, for as long as the registration is open.
A registration you no longer need should be surrendered properly, not abandoned. Abandoning it accrues fees quietly and can end in cancellation by the officer, which is a worse position to be in than a voluntary surrender.
Interest is separate, and is not capped
Late fee and interest are different things and people routinely conflate them.
- Late fee — for filing late. Capped, as above.
- Interest under section 50 — on tax paid late. Charged on the unpaid amount for the period of delay, and there is no cap on it.
So a nil return filed three years late costs ₹500. A return with ₹4 lakh of unpaid tax filed three years late costs ₹2,000 in late fee and a great deal more in interest. The interest is the part that grows.
The rate of interest is prescribed and has been the subject of amendment, so we confirm the applicable rate for your period rather than quote one here.
Working out where you stand
1. List every period you have not filed. The portal shows this.
2. For each, is the tax payable nil or not? That decides which cap applies.
3. Note your preceding-year aggregate turnover. That decides which slab you are in.
4. Separate the tax you owe from the fee you owe. The tax attracts interest; the fee does not.
5. File oldest first. The portal generally requires returns in sequence, and you cannot skip forward.
Most people who have been avoiding this discover the total is smaller than they feared, and that the blocker was never the money.
What to do if you are behind
File. The fee is capped and the cap is small; the interest is not capped and grows. Every week of delay costs interest on the tax, not more late fee once you have hit the cap.
If the registration is one you no longer need, surrender it properly rather than leaving it open.
Ask us on WhatsApp — tell us which periods are outstanding and your turnover band, and we will tell you the position before you commit to anything. See also GST registration if you are not yet registered, or annual compliance if you are behind across the board.
Frequently asked questions
What is the maximum late fee on a nil GSTR-3B?
₹250 under the CGST Act, with an equivalent amount under the State Act — ₹500 in practice — for tax periods from June 2021 onwards, under Notification No. 19/2021–Central Tax.
Does the late fee keep growing forever?
No. It is capped. Once you reach the cap for that return, the late fee stops increasing. Interest on unpaid tax, however, is not capped and does keep growing.
I registered but never traded. Do I owe anything?
You owe the late fee on each unfiled nil return, capped at ₹500 in total per return. You do not owe tax, and therefore no interest. Getting the registration surrendered stops the meter.
Is late fee the same as interest?
No. Late fee is for filing late and is capped. Interest under section 50 is on tax paid late and is not capped. They are calculated separately and both can apply to the same return.
Can the late fee be waived?
Only by notification. Waivers have been granted from time to time as amnesty schemes for specified periods. They are not available on request, and you cannot rely on one arriving.
Do I have to file the oldest return first?
In practice yes — GSTR-3B is filed sequentially and you cannot generally skip a period.
Written by CA Prakash Rai, Vittara Global Advisory LLP. General information, not professional advice. Figures cited from section 47 of the CGST Act, 2017 and Notification No. 19/2021–Central Tax dated 1 June 2021. GST late fees and interest are revised by notification — confirm the position for your specific periods before acting.
