HSN and SAC Code Search
What is HSN Code?
HSN stands for Harmonised System of Nomenclature code. World Customs Organization (WCO) first introduced the concept of HSN code in 1988.
This was introduced for a systematic classification of goods both at national and international level. This is a 6-digit code that classifies various products. In India, HSN codes are used since 1986 for classification of commodities for Customs and Central Excise. HSN is used all over the world. There are different HSN codes for various commodities.
What is the need of HSN code?
The concept of HSN code was developed so that goods can be classified in a systematic and logical manner all over the world. It was developed so that all goods can be aligned in a systematic way so that each country can use it uniformly.
How HSN Code Works? Understanding the Code
The HSN code list is divided into four categories :
Sections : There are 21 Sections in HSN code list
Chapters : There are 99 Chapters in HSN code list which are part of Sections
Headings : Each chapter is divided into Headings and there are total 1244 headings in HSN code list
Sub-headings : Each heading is further divided into Sub-headings and there are total 5224 subheadings
Thus each section is divided into chapters which are further divided into headings and sub-headings.
Structure of HSN Code in World and in India
In World, almost all countries use same HSN code. However, there are some changes made to it by particular countries as per their need and requirements.
The Broad Structure of HSN Code is as under :
CHAPTER – First Two Digits
HEADING – Next Two Digits
SUB-HEADINGS – Next Two Digits
TARIFF ITEM – Next Two Digits
The uniform HSN code is of Six digit only i.e. Chapter, Heading and Sub-heading. But in India, two more digits for tariff code has been added for broader and better classification of Goods.
For Example :
LIVE SHEEP AND GOATS - GOATS
01 represents Chapter i.e. Live Animals, Animal Products
04 represents heading which is Live Sheep and Goats
20 represents sub-heading which is Goats
00 represents tariff code which is Goats
What is Service Accounting Code (SAC) in GST ?
Just as Goods, Services are also classified uniformly for better administration, management and taxation point of view. These codes for Services classification are termed as SAC i.e. Service Accounting Codes. Chapter 99 of HSC Code list the details relating to those.
Services are classified in SAC upto 6 digit :
First two digits for same for all services i.e. 99
Next two digits represents the nature of Services
Next two digits represents the detailed nature of Services
For Example :
998211 - Legal Advisory and representation services concerning criminal law
99 represents Services
82 represents Legal and Accounting Services
11 represents Legal advisory and representation services concerning criminal law
Mandatory Requirement of Declaration of HSN Codes under GST in India
Vide CGST notification no. 78/2020 dtd. 15th Oct.2020, following is the position regarding mandatory requirement of declaration of HSN codes in GST invoices and GST Returns i.e. GSTR-1 [outward supply of Goods and Services]
In case of turnover less than 5 crores, the requirement of declaring HSN code for B2C Invoices is optional.
Type Of Invoices
No of Digits of HSN Code
Above Rs. 5 Crores
Upto Rs. 5 Crores