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What is HSN Code and SAC Code in GST with complete list

What is HSN Code and SAC Code in GST with complete list

GST has been introduced a couple of years back and has brought a list of terms and jargons to ground. There are many terms which professionals are getting familiar with. A couple of those terms are HSN code and SAC code in GST. We will explain here in detail what is HSN code and what is SAC code?
The HSN is elaborated as a “Harmonized System of Nomenclature”. The HSN Code is a system that is known for the classification of goods all over the world. As HSN Codes are used for classification of Commodities. SAC Codes are used for the classification of Services. SAC Codes are known as “Service Accounting Codes”.

WHAT IS HSN CODE?

HSN code was created in the year 1988 by the World Customs Organization (WCO). It has defined over 5000 goods to date. It is a uniform system of classification of goods that are accepted worldwide.

Why HSN Codes are adopted in India?

India has used HSN Codes before GST. For the classification of goods for Custom and Central Excise, India used the system. Earlier India was using a six-digit system but later added two more digits to make codes more specific.

Many countries of the world have adopted HSN Codes to facilitate uniform classification of goods and international trade. India has been a member of WCO since 1971.

Since the implementation, usage of HSN code in GST has brought India head to head with the countries that have been using HSN for years. It has also helped professionals to find an answer to their question around what is HSN code?

The use of HSN codes in GST has resulted in the worldwide acceptability of the GST system in India.

How HSN Code helps taxpayers?

The taxpayer can search the rate of GST applicable just by entering the HSN Code and the GST system returns the rate applicable on goods.

Is HSN Code Mandatory

HSN code in GST is mandatory to be mentioned on an invoice in India.

Where to look for HSN Code?

You can search your HSN Code by Clicking on the following link: https://cbic-gst.gov.in/gst-goods-services-rates.html

What is SAC code?

Hopefully, the above explains what is HSN code? Now, the next question that comes to mind is what is SAC code?

As HSN Codes are used for classification of Commodities. SAC Codes in GST are used for the classification of Services. SAC Codes are known as “Service Accounting Codes”.

Service Tax Department of India came up with the service accounting codes. SACs are used to classify services and to find the rate of tax on those respective services.

Where to look for SAC Code?

SACs are available on the CBIC-GST website. You can access the SACs and rates by clicking on the following link: https://cbic-gst.gov.in/gst-goods-services-rates.html

FREQUENTLY ASKED QUESTIONS (FAQs)

1. Is it necessary to mention HSN/SAC Codes on the tax invoice?

Yes, it is mandatory to mention HSN or SAC Code on the tax invoice issued by the supplier of goods or services or both.

2. How to find HSN/SAC code applicable to a goods or service?

To find the HSN Code applicable to the goods or services supplied, you can visit the https://cbic-gst.gov.in/gst-goods-services-rates.html.

3. What is HSN code and what is SAC code? What is the key difference between HSN Codes and SAC Codes in GST?

These are the harmonized system of nomenclature. HSN Codes in GST are used for classification of Goods whereas SACs are used for classification of services.

4. Are there HSN/SAC codes for Nil Rated or Exempted supply?

Yes, all types of goods or services including nil rated and exempted are classified under HSN/SACs.
For example, Coffee beans not roasted are exempted goods under GST, their HSN Code is 0901.

5. Who does not need to follow the HSN Code system?

The dealers registered under the composition scheme do not need to follow the HSN Code system. In addition, dealers whose turnover is below Rs. 1.50 crores during the year.

6. How many digits are used by dealers in import and export business?

8-digit HSN code system must be followed by the dealers who are into the import or export of goods.

7. Are HSN codes the same for all the countries?

HSN Codes is a goods classification system developed by the World’s Custom Organization (WCO). Countries which are members of WCO uses similar codes.

8. Is India a member of the World’s Custom Organization?

Yes, India has been a member of WCO since 1971.

Here we are going to list SAC code in GST for some common industries:

Services Description Service Accounting Code (SAC)
Medical Services
Medical Laboratory and Diagnostic-imaging services 999316
Medical and dental services 999312
Medical and dental instrument and supply manufacturing services 998897
Installation services of professional medical machinery and equipment, and precision and optical instruments. 998735
Research and experimental development services in medical sciences and pharmacy. 998113
Services provided by operators of the common bio-medical waste treatment facility to a clinical establishment by way of treatment or disposal of bio-medical waste or the processes incidental thereto. 9994
Advertising
Advertising and related photography services 998382
Advertising Services 998361
Professional & Technical Services
Other professionals, technical and business services 9983
Scientific and technical consulting services 998393
Management consulting and management services; information technology services. 99831
Architectural services, urban and land planning and landscape architectural services 99832
Engineering services 99833
Scientific and other technical services 99834
Market research and public opinion polling services 99837
Photography & Videography and their processing services 99838
Other professionals, technical and business services. 99839
Goods Transport Services
Road transport services of Goods including letters, parcels, live animals, household & office furniture, containers etc. by refrigerator vehicles, trucks, trailers, man or animal-drawn vehicles or any other vehicles. 996511
Railway transport services of Goods including letters, parcels, live animals, household & office furniture, intermodal containers, bulk cargo etc. 996512
Transport services of petroleum & natural gas, water, sewerage and other goods via pipeline 996513
Other land transport services for goods n.e.c. 996519
Coastal and transoceanic (overseas) water transport services of goods by refrigerator vessels, tankers, bulk cargo vessels, container ships etc. 996521
Inland water transport services of goods by refrigerator vessels, tankers and other vessels. 996522
Air transport services of letters & parcels and other goods 996531
Space transport services of freight 996532
Storage and warehousing services
Refrigerated storage services 996721
Bulk liquid or gas storage services 996722
Other storage and warehousing service 996729
Rental Services
Rental services of road vehicles including buses, coaches, cars, trucks and other motor vehicles, with or without operator 996601
Rental services of water vessels including passenger vessels, freight vessels etc. with or without operator 996602
Rental services of aircraft including passenger aircraft, freight aircraft etc. with or without operator 996603
Rental services for other transport vehicles n.e.c. with or without operator 996609
Container handling services
Container handling services 996711
Customs House Agent service 996712
Clearing and forwarding service 996713
Other cargo and baggage handling services 996719
Construction Services
Construction Services of other buildings n.e.c 995416
Construction services of other non-residential buildings such as educational institutions, hospitals, clinics including veterinary clinics, religious establishments, courts, prisons, museums and other similar buildings 995415
Construction services of commercial buildings such as office buildings, exhibition & marriage halls, malls, hotels, restaurants, airports, rail or road terminals, parking garages, petrol and service stations, theatres and other similar buildings. 995414
Construction services of industrial buildings such as buildings used for production activities (used for assembly line activities), workshops, storage buildings and other similar industrial buildings 995413
Construction services of other residential buildings such as old age homes, homeless shelters, hostels etc 995412
Construction services of a single dwelling or multi dwelling or multi-storied residential buildings 995411
Construction of a complex, building, civil structure or a part thereof, including a complex or building intended for sale to a buyer, wholly or partly, except where the entire consideration has been received after issuance of the completion certificate, where required, by the competent authority or after its first occupation, whichever is earlier. (the value of land is deemed to be one-third of the total amount charged for such supplies) 9954
General construction services of other civil engineering works n.e.c. 995428
General construction services of outdoor sport and recreation facilities 995427
General Construction services of Power Plants and its related infrastructure 995426
General construction services of mines and industrial plants 995425
General construction services of local water & sewage pipelines, electricity and communication cables & related works 995424
General construction services of long-distance underground/overland/submarine pipelines, communication and electric power lines (cables); pumping stations and related works; transformer stations and related works. 995423
General construction services of harbours, waterways, dams, water mains and lines, irrigation and other waterworks 995422
General construction services of highways, streets, roads, railways and airfield runways, bridges and tunnels 995421
Other construction services 9954
Other special trade construction services n.e.c. 995458
Agriculture Related Services
Support services to agriculture, forestry, fishing, animal husbandry. Services relating to cultivation of plants and rearing of all life forms of animals, except the rearing of horses, for food, fiber, fuel, raw material or other similar products or agricultural produce by way of (a) agricultural operations directly related to production of any agricultural produce including cultivation, harvesting, threshing, plant protection or testing; (b) supply of farm labour; (c) processes carried out at an agricultural farm including tending, pruning, cutting, harvesting, drying, cleaning, trimming, sun drying, fumigating, curing, sorting, grading, cooling or bulk packaging and such like operations which do not alter the essential characteristics of agricultural produce but make it only marketable for the primary market; (d) renting or leasing of agro machinery or vacant land with or without a structure incidental to its use; (e) loading, unloading, packing, storage or warehousing of agricultural produce; (f) agricultural extension services; (g) services by any Agricultural Produce Marketing Committee or Board or services provided by a commission agent for sale or purchase of agricultural produce. 9986
Other support services to agriculture, hunting, forestry and fishing 998619
Leasing or rental services concerning agricultural machinery and equipment with or without operator 997312
Research and development originals in agriculture 998142
Research and experimental development services in agricultural sciences. 998114
Services by way of fumigation in a warehouse of agricultural produce. 9985
“(h) services by way of fumigation in a warehouse of agricultural produce 9986
Services provided by the National Centre for Cold Chain Development under the Ministry of Agriculture, Cooperation and Farmers Welfare by way of cold chain knowledge dissemination. 9992
Services provided by the National Centre for Cold Chain Development under the Ministry of Agriculture, Cooperation and Farmers Welfare by way of cold chain knowledge dissemination. 9988
Services provided by a goods transport agency, by way of transport in a goods carriage of – (a) agricultural produce; (b) goods, where consideration charged for the transportation of goods on a consignment transported in a single carriage does not exceed 1500 Rs. (c) goods, where consideration charged for transportation of all such goods for a single consignee does not exceed 750 Rs; (d) milk, salt and food grain including flour, pulses and rice; (e) organic manure; (f) newspaper or magazines registered with the Registrar of Newspapers; (g) relief materials meant for victims of natural or man-made disasters, calamities, accidents or mishap; or (h) defence or military equipments. Explanation. – Goods transport agency means any person who provides service in relation to transport of goods by road and issues consignment note, by whatever name called. 9967
Services provided by a goods transport agency, by way of transport in a goods carriage of – (a) agricultural produce; (b) goods, where consideration charged for the transportation of goods on a consignment transported in a single carriage does not exceed 1500 Rs. (c) goods, where consideration charged for transportation of all such goods for a single consignee does not exceed 750 Rs; (d) milk, salt and food grain including flour, pulses and rice; (e) organic manure; (f) newspaper or magazines registered with the Registrar of Newspapers; (g) relief materials meant for victims of natural or man-made disasters, calamities, accidents or mishap; or (h) defence or military equipment’s. Explanation. – goods transport agency means any person who provides service in relation to transport of goods by road and issues consignment note, by whatever name called. 9965
Services supplied by electricity distribution utilities by way of construction, erection, commissioning, or installation of infrastructure for extending electricity distribution network up to the tube well of the farmer or agriculturalist for agricultural use 99
Services provided by an unincorporated body or a non-profit entity registered under any law for the time being in force, engaged in,- (i) activities relating to the welfare of industrial or agricultural labour or farmers; or (ii) promotion of trade, commerce, industry, agriculture, art, science, literature, culture, sports, education, social welfare, charitable activities and protection of the environment, to its own members against consideration in the form of membership fee up to an amount of one thousand rupees (Rs 1000/-) per member per year. 9995
Carrying out an intermediate production process as job work in relation to cultivation of plants and rearing of all life forms of animals, except the rearing of horses, for food, fibre, fuel, raw material or other similar products or agricultural produce. 9986
Services of general insurance business provided under following schemes Ð (a) Hut Insurance Scheme; (b) Cattle Insurance under Swarnajaynti Gram Swarozgar Yojna (earlier known as Integrated Rural Development Programme); (c) Scheme for Insurance of Tribals; (d) Janata Personal Accident Policy and Gramin Accident Policy; (e) Group Personal Accident Policy for Self-Employed Women; (f) Agricultural Pumpset and Failed Well Insurance; (g) premia collected on export credit insurance; (h)( Weather Based Crop Insurance Scheme or the Modified National Agricultural Insurance Scheme) substituted by [“Restructured Weather Based Crop Insurance Scheme (RWCIS)] on 22/08/2017, approved by the Government of India and implemented by the Ministry of Agriculture; (i) Jan Arogya Bima Policy; (j) [National Agricultural Insurance Scheme (Rashtriya Krishi Bima Yojana);] substituted by [Pradhan Mantri Fasal BimaYojana (PMFBY)] on 22/08/2017 (k) Pilot Scheme on Seed Crop Insurance; (l) Central Sector Scheme on Cattle Insurance; (m) Universal Health Insurance Scheme; (n) Rashtriya Swasthya Bima Yojana; (o) Coconut Palm Insurance Scheme; (p) Pradhan Mantri Suraksha Bima Yojna; (q) Niramaya Health Insurance Scheme implemented by the Trust constituted under the provisions of the National Trust for the Welfare of Persons with Autism, Cerebral Palsy, Mental Retardation and Multiple Disabilities Act, 1999 (44 of 1999). 9971
Services of general insurance business provided under following schemes Ð (a) Hut Insurance Scheme; (b) Cattle Insurance under Swarnajaynti Gram Swarozgar Yojna (earlier known as Integrated Rural Development Programme); (c) Scheme for Insurance of Tribals; (d) Janata Personal Accident Policy and Gramin Accident Policy; (e) Group Personal Accident Policy for Self-Employed Women; (f) Agricultural Pumpset and Failed Well Insurance; (g) premia collected on export credit insurance; (h)( Weather Based Crop Insurance Scheme or the Modified National Agricultural Insurance Scheme) substituted by [“Restructured Weather Based Crop Insurance Scheme (RWCIS)] on 22/08/2017, approved by the Government of India and implemented by the Ministry of Agriculture; (i) Jan Arogya Bima Policy; (j) [National Agricultural Insurance Scheme (Rashtriya Krishi Bima Yojana);] substituted by [Pradhan Mantri Fasal BimaYojana (PMFBY)] on 22/08/2017 (k) Pilot Scheme on Seed Crop Insurance; (l) Central Sector Scheme on Cattle Insurance; (m) Universal Health Insurance Scheme; (n) Rashtriya Swasthya Bima Yojana; (o) Coconut Palm Insurance Scheme; (p) Pradhan Mantri Suraksha BimaYojna; (q) Niramaya Health Insurance Scheme implemented by the Trust constituted under the provisions of the National Trust for the Welfare of Persons with Autism, Cerebral Palsy, Mental Retardation and Multiple Disabilities Act, 1999 (44 of 1999). 9991
Services by way of transportation by rail or a vessel from one place in India to another of the following goods: (a) relief materials meant for victims of natural or man-made disasters, calamities, accidents or mishap; (b) defence or military equipment; (c) newspaper or magazines registered with the Registrar of Newspapers; (d) railway equipment or materials; (e) agricultural produce; (f) milk, salt and food grain including flours, pulses and rice; and (g) organic manure. 9965
Composite supply of works contract as defined in clause (119) of section 2 of the Central Goods and Services Tax Act, 2017, supplied by way of construction, erection, commissioning, or installation of original works pertaining to,- (a) railways, excluding(including substituted from 25/01/2018) monorail and metro; (b) a single residential unit otherwise than as a part of a residential complex; (c) low-cost houses up to a carpet area of 60 square meters per house in a housing project approved by competent authority empowered under the ‘Scheme of Affordable Housing in Partnership’ framed by the Ministry of Housing and Urban Poverty Alleviation, Government of India; (d) low cost houses up to a carpet area of 60 square meters per house in a housing project approved by the competent authority under- (1) the Affordable Housing in Partnership component of the Housing for All (Urban) Mission/Pradhan Mantri Awas Yojana; (2) any housing scheme of a State Government; (e) post-harvest storage infrastructure for agricultural produce including a cold storage for such purposes; or (f) mechanized food grain handling system, machinery or equipment for units processing agricultural produce as food stuff excluding alcoholic beverages. 9954
Hotel & Accommodation Industry
Room or unit accommodation services provided by Hotels, INN, Guest House, Club etc. 996311
Accommodation in hotels including 5 star and above rated hotels, inns, guest houses, clubs, campsites or other commercial places meant for residential or lodging purposes, where room rent is Rs 7500/and above per day per room 9963
Services provided by Hotels, INN, Guest House, Club etc. including Room services, takeaway services and door delivery of food. 996332
Restaurants & Other Similar Establishments
Services provided by Restaurants, Cafes and similar eating facilities including takeaway services, Room services and door delivery of food. 996331
Services provided by Hotels, INN, Guest House, Club etc. including Room services, takeaway services and door delivery of food. 996332
Services provided in Canteen and other similar establishments 996333
Catering Services
Catering Services in Exhibition halls, Events, Marriage Halls and other outdoor/indoor functions. 996334
Catering services in trains, flights etc. 996335
Preparation and/or supply services of food, edible preparations, alcoholic & non-alcoholic beverages to airlines and other transportation operators 996336
Other contract food services 996337
Other food, edible preparations, alcoholic & non-alcoholic beverages serving services n.e.c. 996339
Employment Related Services
Other employment & labour supply services n.e.c 998519
Co-employment staffing services 998517
Services by the Employees State Insurance Corporation to persons governed under the Employees State Insurance Act, 1948 (34 of 1948). 9971
Services provided by the Employees Provident Fund Organisation to the persons governed under the Employees Provident Funds and the Miscellaneous Provisions Act, 1952 (19 of 1952). 9971
Services furnished by business and employers organizations 999511
Administrative services related to government employee pension schemes; old-age disability or survivors’ benefit schemes, other than for government employees 999132

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Simple GST Invoice format in India - Rules and Example | StairFirst May 22, 2020 at 4:51 pm

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