Gst hsn code question
This query is : Resolved
18 May 2021
Sir,
A gst registered dealer hsn code show in gstr1 from April-21.
Question:
Dealer hsn code only or stock records
(quantity) mentioned both compulsory.
A gst registered dealer hsn code show in gstr1 from April-21.
Question:
Dealer hsn code only or stock records
(quantity) mentioned both compulsory.
18 May 2021
Quantity also needed to be entered in HSN summary
26 July 2024
In GST filings, specifically for GSTR-1, businesses are required to provide details related to HSN codes and quantities for the goods they supply. Here’s a detailed breakdown of the requirements and their significance:
### **1. **HSN Code in GSTR-1**
#### **A. **HSN Code Reporting**
- **Requirement**: GST-registered dealers must mention the HSN codes for goods in their GSTR-1 returns. This helps in categorizing the nature of goods sold and ensuring proper tax classification.
- **Details Needed**:
- **HSN Code**: The code used to classify goods. The level of detail (4-digit or 8-digit) depends on the turnover of the business.
- **Description**: A brief description of the goods corresponding to the HSN code.
- **Value of Supplies**: The total value of supplies for each HSN code.
#### **B. **Quantity Reporting**
- **Requirement**: Businesses must also report the quantity of goods supplied in GSTR-1, though the specific format and level of detail required can depend on the regulations and the turnover of the business.
- **Details Needed**:
- **Quantity**: The total quantity of goods supplied under each HSN code should be mentioned.
### **2. **Compulsory Information**
#### **A. **HSN Code and Quantity**
- **HSN Code**: Mentioning the HSN code is mandatory in GSTR-1 to ensure proper classification and tax treatment of goods.
- **Stock Records**: While the quantity of goods supplied must be reported, the actual stock records (i.e., the detailed inventory levels) are not required to be reported directly in GSTR-1. However, accurate reporting of quantities is necessary to match with the stock records.
#### **B. **Why Both are Important**
- **HSN Code**: Ensures that goods are classified correctly for tax purposes and helps in tax rate determination.
- **Quantity**: Provides transparency and ensures that the reported value of supplies matches the actual quantities supplied, which is crucial for reconciliation and audit purposes.
### **3. **Specifics for GSTR-1**
- **GSTR-1 Filing**: When filling out GSTR-1:
- **HSN Details**: Include the HSN codes and corresponding values of supplies. For businesses with a turnover above ₹5 crore, 8-digit HSN codes are required.
- **Quantity**: Report the total quantity of goods supplied under each HSN code.
### **4. **Compliance and Best Practices**
- **Regular Updates**: Ensure that HSN codes and quantities are regularly updated and accurately reported to avoid discrepancies and issues during audits.
- **Record Keeping**: Maintain detailed stock records and ensure they match the quantities reported in GSTR-1. This will help in smooth audits and reconciliations.
### **Example**
- **Scenario**: A business sells 500 units of electronic gadgets classified under HSN code 8517.
- **In GSTR-1**:
- **HSN Code**: 8517
- **Quantity**: 500 units
- **Value**: ₹2.5L
- **Reporting**: The invoice details and quantities for each HSN code should be accurately reported in GSTR-1.
### **Summary**
- **HSN Code**: Must be mentioned in GSTR-1. The level of detail depends on the business turnover.
- **Quantity**: Must be reported for each HSN code, reflecting the total quantity of goods supplied.
- **Stock Records**: While detailed stock records are not required in GSTR-1, accurate reporting of quantities is crucial.
By adhering to these requirements, businesses ensure compliance with GST regulations and maintain accurate records for tax and audit purposes.
### **1. **HSN Code in GSTR-1**
#### **A. **HSN Code Reporting**
- **Requirement**: GST-registered dealers must mention the HSN codes for goods in their GSTR-1 returns. This helps in categorizing the nature of goods sold and ensuring proper tax classification.
- **Details Needed**:
- **HSN Code**: The code used to classify goods. The level of detail (4-digit or 8-digit) depends on the turnover of the business.
- **Description**: A brief description of the goods corresponding to the HSN code.
- **Value of Supplies**: The total value of supplies for each HSN code.
#### **B. **Quantity Reporting**
- **Requirement**: Businesses must also report the quantity of goods supplied in GSTR-1, though the specific format and level of detail required can depend on the regulations and the turnover of the business.
- **Details Needed**:
- **Quantity**: The total quantity of goods supplied under each HSN code should be mentioned.
### **2. **Compulsory Information**
#### **A. **HSN Code and Quantity**
- **HSN Code**: Mentioning the HSN code is mandatory in GSTR-1 to ensure proper classification and tax treatment of goods.
- **Stock Records**: While the quantity of goods supplied must be reported, the actual stock records (i.e., the detailed inventory levels) are not required to be reported directly in GSTR-1. However, accurate reporting of quantities is necessary to match with the stock records.
#### **B. **Why Both are Important**
- **HSN Code**: Ensures that goods are classified correctly for tax purposes and helps in tax rate determination.
- **Quantity**: Provides transparency and ensures that the reported value of supplies matches the actual quantities supplied, which is crucial for reconciliation and audit purposes.
### **3. **Specifics for GSTR-1**
- **GSTR-1 Filing**: When filling out GSTR-1:
- **HSN Details**: Include the HSN codes and corresponding values of supplies. For businesses with a turnover above ₹5 crore, 8-digit HSN codes are required.
- **Quantity**: Report the total quantity of goods supplied under each HSN code.
### **4. **Compliance and Best Practices**
- **Regular Updates**: Ensure that HSN codes and quantities are regularly updated and accurately reported to avoid discrepancies and issues during audits.
- **Record Keeping**: Maintain detailed stock records and ensure they match the quantities reported in GSTR-1. This will help in smooth audits and reconciliations.
### **Example**
- **Scenario**: A business sells 500 units of electronic gadgets classified under HSN code 8517.
- **In GSTR-1**:
- **HSN Code**: 8517
- **Quantity**: 500 units
- **Value**: ₹2.5L
- **Reporting**: The invoice details and quantities for each HSN code should be accurately reported in GSTR-1.
### **Summary**
- **HSN Code**: Must be mentioned in GSTR-1. The level of detail depends on the business turnover.
- **Quantity**: Must be reported for each HSN code, reflecting the total quantity of goods supplied.
- **Stock Records**: While detailed stock records are not required in GSTR-1, accurate reporting of quantities is crucial.
By adhering to these requirements, businesses ensure compliance with GST regulations and maintain accurate records for tax and audit purposes.
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