GSTN Updates: Major Changes in January 2026 Every Taxpayer Must Know

The Goods and Services Tax Network (GSTN) has issued several important advisories that will affect the taxpayers. These advisories have notified the updates related to GSTR-3B, RSP-based valuation for tobacco products, and the opt-in declaration for hotel accommodation services. Below are the key GST changes that every business must know.

GSTR-3B Filing: Revised Interest Calculation Method

The GSTN has made changes in GSTR-3B to ensure correct interest calculation and accurate reporting. From the January 2026 tax period onwards, the interest calculation in Table 5.1 of GSTR-3B will be auto-calculated by giving the minimum cash balance benefit available in the Electronic Cash Ledger from the due date of filing the return till the payment date. This is as per Rule 88B of the CGST Rules.

Revised Interest Computation Formula: (Net Tax Liability – Minimum Cash Balance in ECL from due date to date of debit) × (No. of days delayed / 365) × Applicable Interest Rate

The interest will be auto-filled and will become non-editable for downward modifications. However, upward modification is allowed. This means that the interest cannot be reduced, but the taxpayers can increase it if needed. Here are other key points mentioned in the advisory:

• This new change is applicable to the delayed returns filed for the January 2026 tax period, for which the interest shall be auto-filled in GSTR-3B for the February 2026 tax period.
• The advisory further notified that if the IGST ITC is fully used, the taxpayers can pay the IGST liability using the CGST and SGST ITC in any order.
• If a cancelled taxpayer filed its last applicable GSTR-3B return late, the interest will be charged and collected through the Final Return, i.e., GSTR-10.

RSP-Based Valuation for Tobacco Goods Under GST

The GSTN issued another advisory on the RSP-based valuation for notified tobacco goods under GST in invoice, e-way bill, and GSTR-1/1A and IFF.

Under the RSP-based valuation method, the GST will be calculated based on the Retail Sale Price (RSP) printed on the package rather than the actual transaction value. Under this method, the deemed taxable value and tax amount are required to be derived from the RSP (tax-inclusive).

The notified tobacco products include pan masala, unmanufactured tobacco, cigars, cheroots, cigarillos and cigarettes, homogenised or reconstituted tobacco, etc.

GST Calculation Under RSP-Based Valuation:

• Tax Amount: (RSP × GST Rate in % of applicable taxes) / (100 + Sum of applicable tax rates).
• Deemed Taxable Value: RSP – Tax Amount

Other Key Points

• Taxpayers must report the Net Sale Value in the taxable value field.
• The GST must be reported strictly as per the notified RSP-based valuation formula.
• The total invoice value must be reported as the sum of the net sale value and the tax amount.
• For reporting in the e-Invoice, e-Way Bill systems, and GSTR-1/1A/IFF, the Net Sale Value (commercial consideration) must be reported in the taxable value filed.
• Taxpayers should be extra careful while using the RSP-based Valuation.

Opt-In Declaration for Specified Premises (Hotel Accommodation Services)

The GST portal has introduced the electronic filing of opt-in declarations for declaring the hotel accommodation premises as “specified premises.”

Who can file?

• Regular taxpayers supplying hotel accommodation services
• New GST registration applicants

The facility is not for composition dealers, TDS/TCS taxpayers, SEZ units, or cancelled registrations.

Types of Declarations and Their Timeline

• Annexure VII: For existing taxpayers (filed between 1 Jan and 31 Mar of the previous year)
• Annexure VIII: For new applicants (filed within 15 days of ARN generation)

Missing deadlines may not allow the businesses to declare their premises as specified.