HSN/SAC Code in GST: Find the Right Code, Avoid Penalties & Download Excel (2026)

What Are HSN and SAC Codes?

HSN stands for Harmonised System of Nomenclature, a globally standardised system of names and numbers for classifying traded products. Developed by the World Customs Organization (WCO), it is used by over 200 countries as the basis for their customs tariffs and tax regimes. Under GST, HSN codes are used to classify all goods supplied in India.

SAC stands for Services Accounting Code, the equivalent classification system for services. While HSN codes follow the international WCO framework (with India-specific extensions), SAC codes are developed domestically by the Directorate General of Taxpayer Services under the CBIC.

Every GST invoice must carry the correct HSN or SAC code. It is not optional — the code determines the GST rate, feeds into GSTR-1 Tile 12 (HSN summary), enables the e-Invoice IRP validation, and helps tax officers match your records against your returns. An incorrect code can lead to penalties under Section 125 of the CGST Act, incorrect tax collection, and ITC rejection for your buyer.

HSN Digit Requirements by Turnover

The number of digits you must report depends on your aggregate annual turnover in the preceding financial year. The rules have been progressively tightened to improve trade data accuracy:

Annual Turnover	Minimum HSN Digits Required
Up to ₹1.5 crore	Not mandatory (but recommended for smooth compliance)
₹1.5 crore to ₹5 crore	4 digits
Above ₹5 crore	6 digits

Important: Even if your turnover is below ₹1.5 crore, using a full 6-digit or 8-digit HSN code helps avoid notices and makes reconciliation easier for your buyers. Many ERPs now default to at least 6-digit codes regardless of turnover.

The requirement applies per GSTIN based on the aggregate turnover of the PAN across India. If one of your GSTINs crosses ₹5 crore, all your GSTINs must report 6-digit HSN codes.

SAC Code Rules — 6 Digits, Always Mandatory

Unlike HSN codes where the digit requirement scales with turnover, SAC codes are always mandatory at 6 digits regardless of how much turnover you generate. Every invoice for a service — whether it is consulting, software development, restaurant services, or transportation — must carry the correct 6-digit SAC code.

A SAC code has the format 99XXXX. The first two digits "99" indicate that it is a service (reserved range), and the remaining four digits follow the Central Product Classification (CPC) structure. For example, SAC 998311 represents legal services, and SAC 996411 represents software development services.

Common HSN Chapters (Goods)

HSN codes are organised into 21 sections and 99 chapters. Here are the most commonly used chapters for everyday businesses:

Chapter	Description	Example Products
02	Meat and edible meat offal	Fresh, chilled, frozen meat
04	Dairy produce, birds' eggs, honey	Milk, butter, cheese, eggs
07	Edible vegetables and certain roots	Potatoes, onions, tomatoes, carrots
08	Edible fruit and nuts	Apples, bananas, grapes, almonds
09	Coffee, tea, mate and spices	Tea bags, coffee powder, pepper
15	Animal or vegetable fats and oils	Cooking oil, butter, ghee
17	Sugars and sugar confectionery	Sugar, jaggery, sweets
19	Preparations of cereals, flour, starch or milk	Biscuits, bread, cakes, pasta
22	Beverages, spirits and vinegar	Soft drinks, bottled water, juice
25	Salt, sulphur, earths and stone	Cement, marble, granite, plaster
27	Mineral fuels, mineral oils and products	Petrol, diesel, LPG, coal
28	Inorganic chemicals	Chlorine, sulphuric acid, ammonia
29	Organic chemicals	Ethanol, benzene, pharmaceutical intermediates
30	Pharmaceutical products	Medicines, vaccines, vitamins
39	Plastics and articles thereof	Plastic bags, bottles, pipes, sheets
40	Rubber and articles thereof	Tyres, tubes, rubber sheets
42	Articles of leather, saddlery and travel goods	Bags, wallets, suitcases, belts
48	Paper and paperboard	Books, notebooks, tissue, cardboard
52	Cotton	Cotton yarn, woven cotton fabrics
61	Articles of apparel and clothing accessories, knitted	T-shirts, sweaters, socks
62	Articles of apparel, not knitted	Suits, shirts, sarees
63	Other made-up textile articles	Blankets, curtains, towels
64	Footwear, gaiters and the like	Shoes, sandals, slippers
73	Articles of iron or steel	Pipes, rods, structures, tools
84	Nuclear reactors, boilers, machinery and mechanical appliances	Engines, pumps, computers, ACs
85	Electrical machinery and equipment	Transformers, cables, phones, fans
87	Vehicles other than railway or tramway	Cars, bikes, auto-rickshaws, parts
90	Optical, photographic, medical and surgical instruments	Spectacles, X-ray machines, lenses
94	Furniture, bedding, mattresses, lamps	Chairs, tables, beds, lighting

A complete HSN code runs to 8 digits: the first 6 digits are the international WCO standard (common across all WCO member countries), digits 7 and 8 are India-specific sub-headings for tariff and statistical purposes.

Common SAC Codes (Services)

Here are SAC codes for frequently provided services:

SAC Code	Service Description
9954	Construction services (buildings, roads, bridges)
9961	IT and software development services
9963	Telecommunications services
9964	Legal, accounting, auditing and consulting services
9965	R&D services
9966	Real estate services (commission, brokerage)
9967	Renting and leasing services
9968	Advertising and market research services
9971	Travel and transportation services
9972	Food, beverage and accommodation services
9973	Cultural, entertainment and sporting services
9983	Management consulting and professional services
9984	Technical testing and analysis services
9985	Education and training services
9986	Health and social care services
9991	Services provided by membership organisations
9992	Repair and maintenance services
9997	Other miscellaneous services not elsewhere classified

Penalties for Wrong HSN/SAC Code

Using an incorrect HSN or SAC code is not a minor clerical error — GST officers treat it as a misdeclaration that can lead to tax evasion. Section 125 of the CGST Act prescribes a general penalty of ₹25,000 for any contravention of the Act or rules for which no specific penalty elsewhere. In practice, for wrong HSN codes on invoices, cumulative penalties can reach ₹50,000 (₹25,000 CGST + ₹25,000 SGST).

Beyond the penalty, wrong codes cause practical problems: your e-Invoice IRN may be rejected by the IRP if the HSN is invalid, your GSTR-1 HSN summary (Tile 12) will not reconcile, and your buyer may face ITC issues if the GST rate derived from the wrong code does not match your actual supply.

HSN/SAC in the e-Invoice and GSTR-1 Workflow

The HSN/SAC code is central to the e-Invoice system. When you generate an IRN, the IRP validates the HSN code against a master list. If the code is invalid or missing, the IRN is rejected. Once the IRN is generated, the HSN code flows automatically into:

• GSTR-1 Tile 4 (B2B): Item-level rates include the HSN/SAC code.
• GSTR-1 Tile 12 (HSN Summary): Auto-populated from e-Invoice data for businesses above the threshold.
• e-Way Bill: The HSN code is part of the EWB generation input.
• GSTR-2B: Your buyer sees your HSN code in their inward supply statement.

How to Find the Right HSN/SAC Code

Here are six reliable methods to determine the correct classification code for your product or service:

1. GST Portal HSN Search: The official GST portal provides a search tool under Services → Search → HSN/SAC. Enter a keyword (e.g., "cotton shirt") and it suggests matching codes.
2. CBIC HSN Master: The CBIC publishes an HSN master list on the GST portal. Download the Excel file and search by description.
3. Your ERP or Billing Software: Most GST-compliant invoicing software (Tally, Zoho, Busy) includes HSN code libraries built into the product master. Verify the code matches the actual product.
4. Industry Association: Many trade associations publish HSN code lists for their sector. For example, the Gem & Jewellery Federation publishes codes for diamond and gold categories.
5. Customs Tariff Act: For imported or exported goods, your customs clearance documents carry the correct HSN code — use the same code for GST.
6. IndIaTaxSim HSN Autocomplete: Our platform includes an HSN search tool that shows HSN codes, descriptions, and GST rates as you type — ideal for learning and practice.

Free HSN/SAC Excel Reference

We have compiled a downloadable Excel file containing the most commonly used HSN and SAC codes for GST compliance. It includes over 500 HSN codes with descriptions and applicable GST rates, plus all major SAC codes for services. Download the HSN/SAC Excel Reference →

Top 20 HSN Codes at a Glance

HSN	Product	GST Rate
090210	Tea (green/black) in packages ≤ 3 kg	5%
170114	Gur / Jaggery	Nil
190531	Biscuits, sweet	18%
220110	Mineral water / aerated drinks	18% / 28%
252329	Portland cement	28%
271012	Petrol / Motor spirit	Outside GST
300490	Medicaments (other than ayurvedic)	12%
392690	Plastic articles (miscellaneous)	18%
401120	Bus / lorry tyres	28%
480100	Newsprint	5%
500790	Silk fabrics	5%
520812	Cotton fabrics	5%
610910	T-shirts (cotton, knitted)	12%
620462	Jeans (cotton, not knitted)	12%
640399	Footwear (leather, retail > ₹1000)	18%
731210	Iron / steel wire strand	18%
841510	Air conditioning machines	28%
847130	Laptops / portable computers	18%
851712	Mobile phones	18%
940350	Wooden bedroom furniture	18%

Common Mistakes with HSN/SAC Codes

• Using the wrong chapter: A common error is classifying a processed product under the chapter for raw materials (e.g., using Chapter 04 for cheese instead of Chapter 19 for dairy preparations).
• Confusing goods and services: Some mixed supplies — like a restaurant serving food (service) — still use a SAC code (996411 for restaurant services), not an HSN code for the food ingredients.
• Using 4 digits when 6 are required: If your turnover is above ₹5 crore and you report only 4-digit HSN codes, your GSTR-1 may be treated as non-compliant.
• Not updating codes: The HSN tariff is updated periodically. A code valid in 2023 may have been reclassified in 2025. Always verify from the latest CBIC master.
• Reusing a buyer's wrong code: If a buyer gives you a purchase order with a wrong HSN code, do not copy it blindly — use the correct code for your goods.

Practice HSN/SAC Codes on IndIaTaxSim

IndIaTaxSim's Invoice Manager includes real-time HSN code search and autocomplete, so you can practice selecting the right code for any product. The study notes also include detailed HSN/SAC reference tables for all major industries. Start practising free →

Disclaimer

The HSN and SAC codes listed here are for educational reference. Always verify the current HSN/SAC master list on the official GST portal or the CBIC website before using codes on live invoices. IndIaTaxSim is not a substitute for official tariff schedules.