The shrinkage of power quality (PQ) was recognized as a perilous failure mode encountered in direct coupled distributed static compensator (DSTATCOM). To recover the PQ, coupling transformer is served in conjunction with DSTATCOM in this research article. The system equivalent circuit of inductively coupled DSTATCOM is achieved by considering impedance of both transformer and DSTATCOM to reveal the filtering mechanism. A case study is inspected in detail to illustrate the performance of both self-supported capacitor and split capacitor interfaced inductively coupled DSTATCOM. The self-supported capacitor based inductively coupled DSTATCOM is augmented better as compared to other in terms of harmonics curtailment, improvement in power factor and potential regulation etc. Finally, MATLAB simulation results using i cos θ control strategy for unbalanced loading condition is adjudged to showcase the suitable topology as required for the public network by satisfying IEEE-519-2017 standard.