India's MSMEs work under three compliance regimes at once: indirect tax (GST), employment law (now the four Labour Codes) and the MSME framework itself, which governs payment terms, registration and access to government credit. Each has its own calendar, and a missed date usually costs money in late fees, interest or lost tax deductions. This guide brings them together so that owners, finance teams and company secretaries can plan the year in one place.

Key numbers at a glance

• • ₹10 crore: turnover ceiling for a micro enterprise
• • 45 days: maximum payment period to micro and small suppliers
• • 21 November 2025: the four Labour Codes came into force
• • ₹10 crore: CGTMSE collateral-free guarantee ceiling

1. Who qualifies as an MSME

Since 1 April 2025, an enterprise is classified on both its investment in plant, machinery or equipment and its annual turnover. The same limits apply to manufacturing and services. If an enterprise crosses either limit, it moves to the next category.

Udyam Registration is the gateway
Registration on the Udyam portal is online, paperless and free, and is based on Aadhaar and PAN. Almost every central MSME benefit depends on it: the 45-day payment protection, CGTMSE guarantees, priority-sector lending, public procurement preferences and the MSME Samadhaan delayed-payment mechanism. Review your Udyam classification each year after your income-tax return and GST data update it.

2. GST compliance calendar for MSMEs

Most MSMEs with aggregate turnover up to ₹5 crore can choose the QRMP scheme (Quarterly Return, Monthly Payment): returns are filed quarterly, but tax is still paid every month. Businesses above ₹5 crore, or those that do not opt in, file monthly.

Monthly and quarterly returns

Half-yearly and annual returns

Key dates for the next six months

Late fees and interest

3. GST changes MSMEs cannot ignore

4. The 45-day payment rule: protection for MSME suppliers

The MSMED Act, 2006 and the Income-tax law together create a strong incentive for buyers to pay micro and small suppliers on time. This matters to MSMEs on both sides of a transaction: as suppliers waiting for money, and as buyers purchasing from smaller vendors.

Watch out
Unlike other Section 43B items, paying before the income-tax return due date does not save the deduction. A contract with 60-day credit terms does not override the 45-day statutory ceiling. Ask vendors for their Udyam certificate, tag them in your accounting system, and run an ageing report before every quarter end.

5. Labour law compliance checklist under the four Labour Codes

The Code on Wages, the Industrial Relations Code, the Code on Social Security and the Occupational Safety, Health and Working Conditions (OSH) Code came into force on 21 November 2025, replacing 29 central labour laws. The Central Rules under all four Codes were notified on 8–9 May 2026. Labour is a concurrent subject, so state rules also apply; several states, including Haryana and Delhi, had not notified final rules as of October 2026. Existing registrations and the old state rules continue during the transition.

Applicability thresholds at a glance

The MSME checklist

Wages and pay structure

• Restructure salaries so that basic pay, DA and retaining allowance are at least 50% of total pay. Excluded allowances above 50% are added back to "wages" for PF, gratuity and bonus.

• Pay monthly wages by the 7th of the next month.

• Settle full and final dues within two working days of exit.

• Pay overtime at twice the ordinary rate, with the worker's consent.

• Pay statutory bonus of 8.33%–20% to eligible employees (wages up to ₹21,000 a month).

Employment documents

• Issue appointment letters in the prescribed format to every employee, including existing staff.

• Put fixed-term contracts on parity with permanent staff; gratuity is payable after one year of service.

• Adopt model standing orders or update HR policies on leave, working hours (48 hours a week) and discipline.

• Record written consent and safety arrangements before women work night shifts.

Social security

• The EPF wage ceiling has been raised from ₹15,000 to ₹25,000 a month, effective 17 September 2026. Enrol newly covered employees.

• Deposit PF and ESI contributions by the 15th of each month.

• Recompute gratuity provisions on the new wage base.

• Haryana: deposit Labour Welfare Fund (employee 0.2% up to ₹35 a month; employer twice that).

Registration, records and safety

• Check whether a single registration under the OSH Code is needed; existing registrations continue in the transition.

• Keep registers electronically and prepare for a single annual return.

• Constitute the Grievance Redressal Committee (20+ workers), with women in proportion to the workforce.

• Arrange free annual health check-ups where prescribed, and maintain safety measures.

Enforcement is softer, but not optional
Inspectors are now "Inspector-cum-Facilitators", and inspections are risk-based and digital. Many first-time offences can be compounded, and improvement notices give time to fix lapses. But the wage, PF and ESI exposure from a wrong pay structure builds up month by month, so it is better to fix it now than at the time of an inspection or dispute.

6. Monthly payroll compliance calendar

7. Government schemes for MSMEs

Government support for MSMEs is mainly about credit: guarantees that replace collateral, subsidised loans for new units, and faster payment of receivables. Most schemes require Udyam registration and are accessed through banks, NBFCs or the scheme's own portal.

Credit and finance

Growth, payments and market access

8. Our recommended action plan

1. Update your Udyam registration and confirm your current category under the revised limits.

2. Build one compliance calendar that combines GST, payroll, MCA and state labour dates, with a named owner for each.

3. Reconcile before you file. Match GSTR-1, GSTR-2B and books every month, and correct errors through GSTR-1A before GSTR-3B locks.

4. Audit your pay structure against the 50% wage rule and the new ₹25,000 EPF ceiling, and issue appointment letters to every employee.

5. Tag MSME vendors and track 45-day ageing to protect tax deductions and file MSME-1 on time.

6. Map the schemes you qualify for, especially CGTMSE, MUDRA and TReDS, before your next borrowing or capex decision.

Need help with MSME compliance?
Insight Juris LLP advises MSMEs on GST, labour code transition, corporate compliance and access to government schemes.

Key references: CGST Act, 2017 and CGST Rules, 2017 (Rules 14A, 59, 61, 61A, 62); Notification Nos. 15/2025 and 18/2025-Central Tax; CBIC Instruction No. 06/2025-GST; GSTN advisories on GSTR-3B hard-locking and the three-year time bar; MSMED Act, 2006 (Sections 15, 16, 23); Income-tax Act, 1961, Section 43B(h) and Income-tax Act, 2025, Section 37(2)(g); Specified Companies (Furnishing of information about payment to micro and small enterprise suppliers) Order; the Code on Wages, 2019, Industrial Relations Code, 2020, Code on Social Security, 2020 and OSH Code, 2020 and the Central Rules, 2026; Union Budget 2025-26 and 2026-27; Ministry of MSME scheme guidelines. Information is current as of 15 October 2026.

Disclaimer

This article is for general informational and educational purposes only and does not constitute legal, tax or financial advice. Laws, deadlines and scheme guidelines may change; readers should verify the latest position through official sources before acting.

Reading this article does not create a lawyer-client or professional relationship with Insight Juris LLP. The firm and its associates disclaim liability for reliance on this content.

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