Last checked 2 November 2026
What the codes are
HSN (Harmonized System of Nomenclature) is the international system for classifying goods, maintained by the World Customs Organization. India uses it for customs and GST. The first two digits are the chapter, four digits the heading, six the sub-heading, and India adds two more for an eight-digit tariff item.
| Digits | Example | What it covers |
|---|---|---|
| 2 (chapter) | 09 | Coffee, tea, mate and spices |
| 4 (heading) | 0902 | Tea |
| 6 (sub-heading) | 0902 30 | Black tea in packets up to 3 kg |
| 8 (tariff item) | 0902 30 10 | A narrower line used in customs and some notifications |
SAC (Services Accounting Code) is India’s own list for services. Every SAC starts with 99, for example 9954 for construction services, 9963 for accommodation and food, 9983 for professional services and 998559 for other travel arrangement services.
How many digits you must show
| Your aggregate turnover in the previous year | B2B tax invoices | B2C invoices |
|---|---|---|
| Up to ₹5 crore | 4 digits | Optional |
| Above ₹5 crore | 6 digits | 6 digits |
This is Notification 78/2020-Central Tax, from 1 April 2021. The same digit rule applies to the HSN summary in GSTR-1. Showing more digits than required is fine and often clearer.
Finding the right code
- Start from what the product is, not what it is used for. A steel water bottle is an article of steel (chapter 73), not a “kitchen item”.
- Search the official HSN/SAC master published on the GST portal. Our HSN code finder searches that list by word or number.
- Check the rate notification for that code. Notification 9/2025-Central Tax (Rate) holds the goods rates from 22 September 2025; services rates are in Notification 11/2017-Central Tax (Rate) as amended.
- Look at your supplier’s bill. It is a useful hint, not proof: suppliers make mistakes too.
- When an item could fit two headings or the rate depends on a condition (packing, price, use), ask your CA and keep a note of why you chose the code.
Same item, different code, different rate
The code decides the rate, so small differences matter. A few examples from the GST 2.0 schedules:
| Item | HSN | GST |
|---|---|---|
| Gold jewellery | 7113 | 3% |
| Imitation jewellery | 7117 | 3% |
| Cut and polished diamonds | 7102 | 1.5% |
| Rough diamonds | 7102 | 0.25% |
| Bricks (specified) | 6901 / 6904 | 12% |
Rates change with notifications. Before you set a rate on an item, check it against the current schedule, not an old price list.
HSN in your returns
GSTR-1 has an HSN-wise summary (Table 12) of everything you sold: code, unit, quantity, taxable value and tax. Since 2025 the table is split into B2B and B2C tabs, and the portal checks codes against its master list. Errors here are a common reason for notices, so keep one code per item and use proper units (NOS, KGS, LTR, BOX and so on, called UQC).
Units (UQC) go with the code
The HSN summary in GSTR-1 asks for a Unique Quantity Code with every HSN line. Pick the unit you actually sell in and keep it the same for the item all year:
| Goods | Typical UQC |
|---|---|
| Rice, sugar, cement sold by weight | KGS (kilograms) or QTL (quintal) |
| Edible oil, paint, milk | LTR (litres) |
| Mobile phones, fans, bottles | NOS (numbers) or PCS (pieces) |
| Tiles, fabric | SQM (square metres) or MTR (metres) |
| Cartons and boxes sold whole | BOX or CTN |
Services have no quantity: report them with the SAC and the value, with the unit left as “NA”. If you buy in boxes and sell in pieces, report sales in pieces and keep the conversion on the item.
Common mistakes
- Putting one code on every item. The HSN summary then shows wrong rates against wrong codes.
- Using a SAC for goods or an HSN for services. A repair job is a service (SAC 9987), the spare part sold with it is goods.
- Copying a code from a different country’s list. Only the first six digits are international; India’s 8-digit lines are its own.
- Not updating codes after a rate change. GST 2.0 moved many items between slabs.
How billinginfo helps
Each item in billinginfo has its own HSN or SAC code and GST rate. The built-in list is the official GST portal master of about 22,000 HSN codes and 680 SAC codes, with suggested GST 2.0 rates where the schedule gives one clear rate. Where the rate depends on a condition, no rate is suggested and you pick. The GSTR-1 report adds up the HSN summary for you.
