The Goods and Services Tax Network (GSTN) is initiating massive changes for the GSTR-2B API from October 2024. These improvements will be oriented toward accuracy, compliance, and the user’s experience for tax payers as well as taxpayers.
Key Improvements
- Real Time Fetching
GSTR-2B API will now make real-time retrieval of invoice data available instead of monthly batch-based updates.
These improvements ensure a business has live input tax credit information.
- Improved Accuracy in Data
It will automatically flag duplicate and incorrect invoices to reduce mismatches.
The system will employ AI-based data validation to reduce errors in reporting.
- Enhanced Reconciliation Capabilities
The API will automate reconciliation between GSTR-2B and GSTR-3B.
Businesses can now create a reconciliation report that compares ITC claims with the data reported by suppliers.
- New JSON Format Structure
The updated API will include a new JSON schema for clarity and easier integration with third-party accounting software.
It will require the developers of the systems to modify them considering the new structure.
- Extra Fields of Data
HSN-wise ITC details will now be there for enhanced tax classification.
Better tracking of vendor compliance will be possible due to supplier-wise ITC breakup.
- Forcing Changes in Mandatory Authentication
API calls will now have 2FA security features.
Access tokens will have reduced validity so that they do not get misused through undue access.
Businesses will need to update their ERP and accounting software to integrate with the new API changes.
Enhanced reconciliation features will reduce ITC mismatches and potential penalties.
Real-time data access will allow better cash flow and compliance planning.
Steps to Prepare
Review API Documentation – Developers should study the updated API structure.
Update Software Systems – Ensure compatibility with the new JSON format and authentication requirements.
Test Integration – Work with the sandbox environment from GSTN before going live.
Train Finance Teams – Educate teams on changes and impact to ITC reconciliation.
Monitor GSTN announcements for further refinements or more guidelines.
Conclusion
From October 2024, the API for GSTR-2B is being altered in order to increase tax compliance and make accurate ITC claims. It will be imperative that businesses take timely action in upscaling their systems and processes so as not to miss this train for seamless GST compliance.
