GST – Major Change to be executed in GSTR 1 filed from 1st May 2021 onwards.

1st April 2021 marked the new change for imposition of 4/6/8 digit HSN/SAC codes regarding HSN/ SAC codes as below link.

https://taxguru.in/goods-and-service-tax/16-bullet-points-gst-hsn-code-requirements.html

12 points need to be noted for the GSTR-1 for the month of April 2021 to be filed from 1st May 2021 onwards:

1. GST returns need to be reported with HSN codes.

2. Businesses with turnover exceeding INR 5 crores need to upload HSN summary with 6 digit HSN codes.

3. If one is filing monthly GSTR-1, HSN details of April need to be filed in May 2021. If one is filing quarterly GSTR-1, 4 digit HSN codes of April to June 2021 need to be filed in July 2021.

4. Businesses can choose to mention HSN codes Voluntarily also. Businesses upto 5 crores can mention 6 or 8 digits and businesses above 5 crores can mention optionally mention 8 digits HSN. There is no bar in mentioning higher digits but there is bar in mentioning lower digits.

5. Due to this change, now in Table 12 of GSTR 1 (i.e., details of outward supplies of goods or services), minimum 4/6/8 digits need to be mentioned there.

6. Also, in Table 12, total value in HSN summary is replaced by rate of tax, implying both HSN wise and rate wise sales reporting need to be done in Gstr 1’s filed from 1st May 2021 onwards.

7. Businesses need to take stock of the different types of products and/ or services so that the HSNs can be jotted down; which may fall under the same chapter and same heading or different chapters with different headings.

8. Last 2 digits need to be emphasized and to be ensured to be correctly mentioned in case of businesses above 5 crores turnover. That means, last 2 digits of 6 digits need to be ensured to be correctly reported in Gstr 1.

9. The accounting or the Gst software need to be updated accordingly, to save last minute glitches while filing Gstr 1’s from 1st may 2021 onwards.

10. The description of goods column will now auto populate based on HSN reported in Gstr 1.

11. In the previous Gstr 1’s filed for the March 2021, the criteria for HSN summary used to be HSN, description and UQC. Whereas for Gstr 1’s for April 2021 field from May 1st onwards, the criteria will be HSN, Rate and UQC.

12. Section 125 wrt General Penalty- Specifies fines for mistakes related to non-mentioning or mentioning wrong HSN/ SAC Code on the tax invoices and Form GSTR-1, which may extend to  Rs. 25,000/- each for CGST and SGST.

Also Read:

HSN codes for Goods

SAC codes for services

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