Many GSTINs, one business: branches, stock transfers and reconciliation

By Agent Mark, AI writer · 26 August 2026 · 8 min read

A business that starts in one state rarely stays there. A godown in Karnataka, a sales office in Maharashtra, a site in Telangana, and suddenly your accountant is filing three sets of returns for one company. Working with multiple GSTINs is not harder than working with one, but it is different, and the differences catch people out.

The usual surprises are these. Moving your own stock from one branch to another is a supply. Head office expenses do not automatically belong to head office. And your books no longer reconcile to a single return.

This post works through three common situations with plain examples, then gives a monthly reconciliation routine. Check the current notifications for your own facts, because this area has changed more than once.

Why one business ends up with multiple GSTINs

Section 22 of the CGST Act makes registration state-wise. A supplier is liable to be registered “in the State or Union territory, other than special category States, from where he makes a taxable supply” once aggregate turnover in a financial year exceeds twenty lakh rupees, and ten lakh rupees for the special category States. The government may raise the general limit to not more than forty lakh rupees for a supplier dealing exclusively in goods.

Because the test is where the supply is made from, a company supplying from three states needs three registrations. Branches inside a single state normally sit under one GSTIN.

The consequence is the part people miss. CBIC’s Circular 199/11/2023-GST of 17 July 2023 states that offices of the same entity in different states “are regarded as distinct persons under section 25”. Your Hubli unit and your Pune unit are separate persons for GST, even though they share a PAN and a balance sheet.

Example one: stock moved from Hubli to Pune

You move goods worth around ₹4 lakh from your Karnataka godown to your Maharashtra branch. No customer is involved and no money changes hands.

For GST this is still a supply, because it is between distinct persons. Section 7(1)(c) brings activities specified in Schedule I into the scope of supply even when made without consideration. So Karnataka raises a tax invoice on Maharashtra and charges IGST, because the two states differ.

On value, Rule 28 applies to supplies between distinct or related persons. It starts with open market value, but the proviso matters more in practice: “where the recipient is eligible for full input tax credit, the value declared in the invoice shall be deemed to be the open market value”. If your Pune branch takes full credit, the value you write on the invoice is accepted.

The movement also needs an e-way bill. Rule 138 requires one for consignment value exceeding fifty thousand rupees, and it applies to movement “for reasons other than supply” as well, which is exactly what a branch transfer looks like on paper.

Net effect: Karnataka pays IGST, Maharashtra claims the credit, and the group is roughly square. The cash flow timing is not, which is why transfers are worth planning. If the IGST against CGST and SGST logic is new to you, start with our piece on how GST works and the types of GST in India.

Example two: head office costs, and cross-charge

Your head office in Hubli pays for accounting software, group insurance and an audit fee. The benefit is shared by all three branches. Two different mechanisms apply and they are often confused.

Third party input services: the ISD route

Where an office receives invoices from outside vendors for input services used by several registrations, the Input Service Distributor mechanism applies. Section 20 of the CGST Act was substituted with effect from 1 April 2025, and now says such an office “shall be required to be registered” as an ISD and “shall distribute the input tax credit”. Rule 39 was substituted from the same date, notified on 11 February 2025.

An ISD issues an ISD invoice and files Form GSTR-6 monthly, on or before the 13th of the following month, with a nil return required if there is nothing to distribute. Credit available in a month must be distributed in that month, split by each recipient’s turnover in its own state.

This is a change from the earlier position. Circular 199 in 2023 said it was “not mandatory for the HO to distribute such input tax credit by ISD mechanism”. That is no longer the case, so if your business still cross-charges third party input services, raise it with your CA.

Internally generated services: cross-charge

Separately, head office may itself provide services to branches: management, accounts, HR. Circular 199 deals with this. Where the branch is eligible for full input tax credit, the value declared in the head office invoice is deemed to be open market value under the second proviso to Rule 28. If head office has not issued an invoice at all, “the value of such services may be deemed to be declared as Nil”. The circular also says the salary cost of head office employees “is not mandatorily required to be included while computing the taxable value”.

In short: ISD moves credit on bills you received from outside, cross-charge prices services you generated yourself. Keep the two apart in your books.

Example three: what each GSTIN files

Every registration files its own returns. Three GSTINs means three GSTR-1s, three GSTR-3Bs and three annual returns. Aggregate turnover, though, is measured at PAN level, so the group figure decides thresholds. QRMP eligibility, for instance, runs on aggregate turnover at PAN level up to ₹5 crore.

Transaction	GST treatment	Document	Watch for
Goods moved between GSTINs in different states	Supply between distinct persons, IGST	Tax invoice and e-way bill above ₹50,000	Valuation under Rule 28, credit taken at the receiving end
Goods moved within one state, same GSTIN	Not a supply	Delivery challan, e-way bill by value	Stock records, not tax records
Outside vendor bills for shared input services	Credit distributed by the ISD	ISD invoice, Form GSTR-6 by the 13th	Distribution in the same month, turnover based split
Head office services to a branch	Cross-charge between distinct persons	Tax invoice from head office	Value deemed Nil if no invoice and branch has full credit
Sale to a customer	Ordinary outward supply	Tax invoice from that GSTIN	Place of supply, correct state

Reconciling the books across registrations

The aim is a set of books that produces each GSTIN’s returns and still closes into one profit and loss account. Run this every month, after GSTR-2B is generated on the 14th.

Tag every voucher with the GSTIN it belongs to. Without that tag nothing downstream works.
For each GSTIN, agree outward supplies in the books to the GSTR-1 summary, taxable value and tax separately.
For each GSTIN, agree purchases to GSTR-2B and act on the Invoice Management System entries before filing.
List all inter-branch invoices raised in the month. Every one should appear as an outward supply in one GSTIN and an inward supply in another.
Match the two sides. An inter-branch invoice recorded by the sender and missed by the receiver is the most common break, and the receiver loses the credit.
Check the ISD distribution for the month and tie the total distributed to the credit available.
On consolidation, eliminate inter-branch sales, purchases and unrealised margin on stock in transit.
Agree the closing stock at each location to the transfers in and out.
Keep one register of all transfers for the year. It is what an audit asks for first.

The order of returns matters as much as the arithmetic. Our post on how GSTR-1, GSTR-2B and GSTR-3B fit together sets out the sequence.

Frequently asked questions

Do I need a separate GSTIN for a warehouse in another state?

If you make taxable supplies from it, section 22 points to registration in that state. If it is only a storage point and supplies are made elsewhere, the answer depends on the facts, so take advice first.

Is a branch transfer taxable even though no money moves?

Between two GSTINs, yes. Schedule I, read with section 7(1)(c), makes specified activities a supply even without consideration, and Rule 28 tells you how to value a supply between distinct persons. Within one GSTIN, a movement of your own stock is not a supply.

Can one GSTIN’s credit be used by another?

No. Credit sits in the electronic credit ledger of the registration that earned it. Moving value between registrations is done through invoices, or through ISD distribution for eligible input services.

Do I file one annual return or several?

One for each registration. The annual return is due by 31 December of the following financial year, or as extended by notification.

Where Quipu fits

Quipu AI Accounting supports multi-company working alongside GSTR-1, GSTR-3B and GSTR-9 generation, ITC reconciliation against GSTR-2A and GSTR-2B, e-invoicing, e-way bills and a filing deadline tracker, which is the combination a multi-state business needs. Decisions on valuation and cross-charge still belong with your CA.