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These 5 GST Changes Are Now In Effect As Of April 1; See Details

With each passing month, GST is becoming more dynamic, particularly in input tax credit applications and reconciliations.

We have begun the fiscal year 2023-24. This is significant for GST-registered businesses because they already had to comply with some key GST provisions before the year began, such as preparing new invoicing series, computing aggregate turnover to determine whether or not to opt into the composition scheme for FY 2023-24 or the quarterly return and monthly payment scheme, filing LUT for FY 2023-24, determining whether e-invoicing applies, and so on.

Among these compliances, the goods and services tax (GST) law will experience a number of changes beginning April 1, 2023. Businesses of all kinds must be wary of the changes and comply with the most recent GST rules and regulations to avoid unpleasant encounters with the taxman.

The e-Invoicing system will not accept 4-digit HSN codes starting very soon. The NIC released an advisory on 9th March 2023 for users of the e-invoicing portal

All such e-invoices with an HSN number of four instead of six digits will be blocked by the system. This update will be applied on the portal soon via another notification. The CGST Notification No.78/2020, published on October 15, 2020, made it mandatory for taxpayers to cite a 6-digit HSN code for all sales where their Aggregate Annual Turnover (AATO) exceeds Rs.5 crores. If you cannot locate the 6-digit HSN code for any item while generating an e-invoice, submit a ticket to the NIC’s helpdesk to have the code added to the system.

As a result, businesses that follow the e-invoicing rules must ensure that their ERPs and billing systems are modified or updated for the new validation or norm, ideally before the start of the new fiscal year, to ensure that invoicing runs efficiently. On the e-invoice portal, the option for voluntary e-invoicing is allowed.

The government intends to expand the e-invoicing system in order to reduce the turnover group of taxpayers with an AATO of less than Rs.10 crore. While the GSTN has yet to declare the timelines, the e-invoice portal has enabled taxpayers who are not subject to the e-invoice mandate to enable themselves voluntarily.