Phase-3 HSN Code Reporting in Table 12 from May 2025: GSTN Issues Advisory

The Goods and Services Tax Network (GSTN) has recently announced the implementation of Phase 3 for reporting Harmonized System of Nomenclature (HSN) codes in Table 12 of GSTR-1/1A, which would be effective from May 2025 return period.

In addition, Table 13 of the return form that makes the listing of supporting documents compulsory, will also become compulsory for all taxpayers. This move is taken to simplify and ease the compliance and also enhance transparency under the GST regime.

As per Notification No. 78/2020 – Central Tax dated October 15, 2020, taxpayers need to report a minimum of 4 or 6 digits of HSN codes in Table 12 of GSTR-1 as per their Aggregate Annual Turnover (AATO) in the preceding financial year. The mandate introduced to standardize tax reporting and improve data accuracy, has been rolled out in phases. Implemented on November 01, 2022, Phase-2 extended HSN requirements to even smaller taxpayers.

Under Phase-3 which was rolled out in May 2025, the GST Portal will impose stricter validations in order to ensure compliance. Taxpayers whose AATO exceeds ₹5 crore limit, are required to report 6-digit HSN codes, while those with turnover up to ₹5 crore must provide 4-digit codes. 

In a crucial update, Table 13 of GSTR-1/1A listing invoices and related documents, will not be mandatory. In this table, the taxpayers are required to provide detailed information on documents issued during the tax period, including invoices, credit/debit notes and delivery challans. The GSTN said that this update will enhance audit trails, facilitating hassle-free inter-state transactions.

GSTN has also requested businesses to review their systems and keep HSN codes updated in their accounting software to eliminate the chances of filing errors. Taxpayers are advised to cross-check the turnover data from the previous financial year to determine the applicable HSN digit requirement.

To get detailed insight on guidelines, the GSTN has directed taxpayers to reach out to advisory document on the GST Portal. However, failing to adhere to the updated reporting standards may lead to scrutiny or penalties as per GST laws.

With the May 2025 deadline approaching, taxpayers must prioritize shifting to new requirements to ensure uninterrupted compliance, thus to avoid any kind of operational disruptions.