Compliance with essential GST requirements is crucial for companies that are GST-registered. Prior to the start of the year, companies must prepare new invoice processing series, evaluate their accumulated turnover to determine whether to opt for the scheme for FY 2023-2024 or the quarterly return and monthly payment scheme, file their LUT for FY 2023-2024, and decide whether to adopt e-invoicing, among other things. All businesses, regardless of their taxpayer type, must be aware of these changes and adhere to the most up-to-date GST regulations and rules to avoid any unpleasant encounters with the tax office. Furthermore, beginning on April 1, 2023, the law governing the goods and services tax (GST) will undergo numerous changes in addition to these compliances.
On the e-invoice portal, the choice for voluntary e-invoicing is enabled
The government is planning to reduce the turnover threshold for payers with an Annual Aggregate Turnover (AATO) of less than Rs. 10 crores by expanding the usage of electronic invoicing. Although the GSTN has not yet announced any deadlines, the e-invoice portal has enabled taxpayers who are not obligated to use e-invoicing to use the portal voluntarily.
This enables taxpayers with AATOs below Rs. 10 crores to register, test their systems, and prepare adequately for the implementation of e-invoicing before it becomes mandatory. The announcement regarding this modification was made on March 17, 2023, through an alert on the NIC’s e-invoice site. In the year 2023-2024, the voluntary e-invoicing update is expected to increase the number of MSME companies using the e-invoice portal, which will enable them to take advantage of features like invoice discounting and other benefits.
6-digit HSN reporting in e-Invoice is required
Starting soon, the e-Invoicing system will no longer accept 4-digit HSN codes. On March 9, 2023, the NIC issued a warning to customers of the e-invoicing site einvoice1.gst.gov.in. The system will reject any e-invoices that use a 4-digit HSN code instead of the required 6-digit reporting code.
In accordance with CGST Notification No. 78/2020, released on October 15, 2020, taxpayers with an Aggregate Annual Turnover (AATO) exceeding Rs. 5 crores must use a 6-digit HSN number. The portal will soon be updated to reflect this change, and if you cannot find the 6-digit HSN number for an item while creating an electronic invoice, please raise a ticket on the NIC’s helpdesk with the appropriate information.
Therefore, companies that comply with e-invoicing requirements must ensure that their ERP and billing systems are updated or adapted to the most recent validation or rule, especially before the start of the upcoming financial year, to ensure smooth invoicing.
In 2023–2024, the GST Network will deploy four additional Invoice Registration Portals, giving the taxpayers who must generate electronic invoices for their businesses a variety of portal options (IRPs). From the website of einvoice4.gst.gov.in, einvoice3.gst.gov.in, einvoice5.gst.gov.in, and einvoice6.gst.gov.in, the new e-invoicing portals will be reachable.
To guarantee a smooth e-invoicing service with great flexibility, durability, and the least amount of downtime, taxpayers can use private IRPs. They can also obtain value-added services like MIS dashboards, interfaces with ERPs, and dedicated support.
As the e-invoicing system is made available to more taxpayer groups in FY 2023–24, the goal of this step is to enhance the entire user compliance journey.
Late fee for GSTR-9 filing reduces in 2023
Let’s say a company waits until the following fiscal year to file GSTR-9 for the fiscal year 2022–2023. The late fee will then be assessed based on the turnover category it belongs to. If we take an example of a company that has annual revenue of up to Rs. 5 crores, but not more. In that instance, a late fee of Rs. 50 per day of delay, with a maximum charge of 0.04% of the state’s or Union Territory’s overall turnover, is applicable.
Let’s say the revenue ranges from Rs. 5 to 20 crores. In that situation, a late fee of Rs. 100 per day of delay is applicable, subject to the same 0.04% of the state’s or union territory’s total annual sales.
Alternately, the revenue is greater than Rs. 20 crores. The late fee will then be the same as it was previously, which is Rs. 200 per day of delays with a previous max limit of 0.05% of the state’s or Union Territory’s turnover. Although the change has not yet been made public, any company that submits annual returns must be informed of it and prevent late costs by organizing its submissions in advance.
Launch of private IRPs for e-invoicing
In 2023–2024, the GST Network will deploy four additional Invoice Registration Portals, giving the taxpayers who must generate electronic invoices for their businesses a variety of portal options (IRPs). From the website of einvoice4.gst.gov.in, einvoice3.gst.gov.in, einvoice5.gst.gov.in, and einvoice6.gst.gov.in, the new e-invoicing portals will be reachable.
To guarantee a smooth e-invoicing service with great flexibility, durability, and the least amount of downtime, taxpayers can use private IRPs. They can also obtain value-added services like MIS dashboards, interfaces with ERPs, and dedicated support.
As the e-invoicing system is made available to more taxpayer groups in FY 2023–24, the goal of this step is to enhance the entire user compliance journey.