Navigating the Latest Changes in Table 12 of GSTR-1/1A: What Every GST Registered Business Needs to Know About HSN Code Reporting in 2025

Goods and Services Tax (GST) compliance continues to evolve with the aim of streamlining tax administration, increasing transparency, and minimizing fraud. One of the significant components of GST return filing is the GSTR-1 form, specifically Table 12, which deals with the HSN-wise summary of outward supplies. As of 2025, the latest amendments to Table 12 of GSTR-1 and GSTR-1A have introduced critical changes in HSN code reporting that every GST-registered business must understand and adopt for seamless compliance.

This article looks into the updated regulations, who they apply to, what businesses need to do, and practical tips to ensure accurate HSN reporting.

Understanding Table 12 of GSTR-1/1A

Table 12 of GSTR-1/1A is where businesses report the summary of outward supplies classified by HSN (Harmonized System of Nomenclature) codes. This table requires GST-registered entities to furnish:

●     HSN Code

●     Description of goods/services

●     UQC (Unit Quantity Code)

●     Total quantity

●     Total value

●     Taxable value

●     Integrated, Central, State/UT, and Cess amounts

Accurate reporting in Table 12 is crucial as it allows the government to monitor sectoral trends, track supply chains, and enforce compliance efficiently.

What's New in 2025: Key Changes in HSN Code Reporting

The Central Board of Indirect Taxes and Customs (CBIC) has updated the compliance framework for Table 12 in GSTR-1/1A effective April 1, 2025, with the following major changes:

1. Mandatory 6-digit or 8-digit HSN Codes

Businesses must now report 6-digit HSN codes mandatorily for B2B transactions and 8-digit codes for select industries. The previous leniency for using 4-digit codes is discontinued for almost all categories.

2. Auto-population of HSN Descriptions

The system now auto-populates the description of goods/services once a valid HSN code is entered. This eliminates discrepancies between supplier and recipient records and promotes standardization.

3. Validation against GST Rate Database

Entries in Table 12 are validated in real time against the official GST rate database. Errors in codes or mismatched tax rates will result in system-level rejections or warnings at the time of filing.

4. HSN Summary Mandatory for Nil-rated, Exempt, and Non-GST Supplies

Previously, businesses were exempt from reporting HSN codes for exempt or nil-rated supplies. The new rule now mandates disclosure of HSN even for such supplies, enhancing tax data accuracy.

5. Penal Provisions for Non-compliance

Failure to furnish accurate HSN codes may now attract penalties under Section 125 of the CGST Act, with fines up to Rs 25,000 per offense.

Who Needs to Pay Attention?

These changes are applicable to:

●     All GST-registered businesses, whether dealing in goods or services.

●     Small businesses (with turnover below ₹5 crore) doing B2B sales.

●     Exporters, who need precise HSN reporting for IGST refunds.

●     E-commerce operators facilitating supply of goods/services.

●     Businesses in notified sectors (like chemicals, pharmaceuticals, textiles), where 8-digit codes are now mandatory.

Impact of the Changes

The changes in Table 12 bring both opportunities and challenges:

Benefits:

●     Enhanced data quality and accuracy.

●     Faster processing of returns and refunds.

●     Reduced mismatch notices and disputes.

●     Improved analytics for the government.

Challenges:

●     Increased compliance burden, especially for small businesses.

●     Need for updated ERP/software systems.

●     Higher risk of system rejection or return filing delays.

Steps to Ensure Compliance

To navigate these changes smoothly, businesses must adopt a proactive approach:

1. Update Accounting/ERP Software

Ensure your systems are aligned with the GSTN portal to accommodate 6 or 8-digit HSN reporting and auto-description features.

2. Train Your Finance & Tax Team

Employees handling GST returns must understand the revised rules and HSN structure to avoid errors in reporting.

3. Verify HSN Codes with GSTN Master Database

Use the GST portal or CBIC’s HSN lookup tool to cross-check the correct HSN code, description, and applicable tax rate before filing.

4. Maintain Product-Wise HSN Mapping

Create an internal master list mapping each product/service to its correct HSN code, especially if you deal in a wide product range.

5. Double-Check Before Filing

Validate all entries in Table 12 for quantity, UQC, tax amounts, and HSN accuracy. Errors here can lead to issues in GSTR-2A reconciliation.

Frequently Asked Questions (FAQs)

Q1. What if I still use 4-digit HSN codes in 2025?
 You risk rejection of GSTR-1 filing and potential penalties. For B2B supplies, 6-digit codes are mandatory.

Q2. Do service providers also need to use 6-digit codes?
 Yes, service providers must report SAC (Service Accounting Code), and the 6-digit format applies to them as well.

Q3. Is there any grace period to comply?
 No formal grace period has been announced. Compliance is mandatory from the effective date (April 1, 2025).

Conclusion

The 2025 amendments to Table 12 of GSTR-1/1A mark a significant shift in GST compliance, emphasizing transparency, standardization, and accurate HSN code reporting.