HSN and SAC codes explained: structure, how many digits to print and how to find yours

HSN codes classify goods and SAC codes classify services, and every GST rate is tied to one of them. Indian HSN codes run to 8 digits: the first two are the chapter, four the heading, six the sub-heading, and eight the tariff item. If your turnover was up to ₹5 crore last year you must print at least 4 digits on B2B invoices; above ₹5 crore, 6 digits on every invoice; exports need all 8. Getting the code right fixes your rate, your invoice and your GSTR-1 HSN summary in one go.

What HSN and SAC are

The Harmonised System of Nomenclature is a product classification maintained by the World Customs Organisation and used by over 200 countries for customs tariffs. India adopted it for central excise and customs decades ago and carried it into GST in 2017. The Customs Tariff Act, 1975 extends the international 6-digit code to 8 digits for Indian tariff items.

The Services Accounting Code is India's own scheme for services, derived from the UN Central Product Classification. All SACs are 6 digits and begin with 99. Chapter 99 of the GST rate schedule lists them.

Under Rule 46(g) of the CGST Rules, a tax invoice must carry the HSN code of goods or the SAC of services. The rate schedules (Notification 1/2017-Central Tax (Rate) for goods and 11/2017 for services, as amended most recently in September 2025) are organised by these codes, which is why the code comes first and the rate follows.

The structure of the 8 digits

Take a cotton T-shirt: HSN 6109 10 00.

Chapters are grouped into 21 sections (Section XI covers textiles, chapters 50 to 63). The first six digits match the international code used everywhere; the last two are India-specific. This is why a Jaipur handicrafts exporter can quote the same 6 digits to a buyer in Germany and the customs officer there recognises it.

SAC codes work similarly. Take 998314 (IT design and development services):

A few SAC codes small businesses see often: 996331 restaurant and food services, 996511 road transport of goods, 995411 to 995419 construction services, 997212 rental of commercial property, 998311 management consulting, 998399 other professional services, 999293 commercial training and coaching, 997159 other financial services, 998597 landscape and grounds maintenance.

How many digits you must print

Notification 78/2020-Central Tax, effective 1 April 2021, sets the requirement by aggregate turnover in the preceding financial year.

Two related requirements:

• E-invoicing. If you are covered by e-invoicing (turnover above ₹5 crore in any year since 2017-18), the IRP requires a valid 6-digit HSN for each line. See our e-invoicing guide.
• E-way bills. The e-way bill portal validates HSN digits against the same turnover rule, and rejects invalid codes. See our e-way bill guide.

Printing more digits than required is always allowed. If you are close to ₹5 crore, switch to 6 digits in your item master now so the crossover year needs no change.

How to find the right code

1. Start with what the product is, not what you call it. "Kurti" is not a heading; "women's dresses of cotton, not knitted" (6204 42) is. Describe the material, the process (knitted or woven), the use and the form (raw, semi-finished, finished).
2. Search the GST portal. Services, User Services, Search HSN Code accepts a description or a code and returns the chapter, heading and rate. A HSN and SAC lookup does the same with a faster search.
3. Read the chapter and section notes. The Customs Tariff has notes that include or exclude items from a chapter. Plastic furniture is in 9403 (furniture), not chapter 39 (plastics), because of such a note.
4. Apply the General Rules for Interpretation. The specific description beats the general one (GRI 3(a)). Mixtures and sets are classified by the component that gives them their essential character (GRI 3(b)). If still tied, the heading that comes last in numerical order (GRI 3(c)).
5. Check your supplier's invoice. The same goods should carry the same code down the chain. If your supplier uses 8517 62 90 for a router and you use 8471, one of you is wrong.
6. Confirm the rate against the code. The rate schedule lists entries by HSN; some headings are split across rates by price or packaging conditions.
7. Record it once. Put the code in your item master so every invoice, label and return uses the same one.

When a product genuinely straddles two codes, or when the rate difference is large (5% versus 18%), ask your CA or seek an advance ruling under Section 97 rather than guess. Classification disputes are the most common reason for rate demands.

Everyday codes for small businesses

A quick reference for common trades. Verify each against the current tariff before use, because sub-headings change.

HSN summary in GSTR-1 (Table 12)

Table 12 of GSTR-1 reports outward supplies grouped by HSN or SAC, with description, unit (UQC), quantity, taxable value and tax by type. Since the May 2025 tax period the table has two tabs, B2B and B2C, and the code must be selected from the portal's dropdown rather than typed. For turnover up to ₹5 crore the B2C tab is optional; for above ₹5 crore both are mandatory and validated against the invoice-level data.

Practically this means:

• Every sales line needs an HSN or SAC at the time of invoicing. Adding codes at month-end for hundreds of lines is where errors creep in.
• Quantities need a valid unit from the UQC list (NOS, KGS, MTR, PCS and so on). Services use NA or OTH.
• The taxable value in Table 12 must equal the sum of the invoice-level tables; the portal warns on mismatch and, for larger taxpayers, blocks filing.
• The HSN summary is a favourite audit tool because it shows the department your product mix and rate mix in one table.

The GSTR-1 tables around it are explained in our GSTR-1 and GSTR-3B filing guide.

A worked example: setting up an item master at a Kochi electronics shop

Anil's shop had a turnover of ₹3.2 crore in FY 2025-26, so he must print 4-digit HSN on B2B invoices. He sells mostly B2C and prints 4 digits on those too, so the item master is consistent. His top items after the September 2025 rate changes:

In August 2026 he sells 12 TVs, 40 fans, 25 phones, 30 mixers and 10 warranties. His Table 12 B2C tab shows five lines:

• 8528: qty 12, taxable ₹2,88,000, CGST ₹25,920, SGST ₹25,920
• 8414: qty 40, taxable ₹88,000, CGST ₹2,200, SGST ₹2,200
• 8517: qty 25, taxable ₹3,75,000, CGST ₹33,750, SGST ₹33,750
• 8509: qty 30, taxable ₹1,05,000, CGST ₹9,450, SGST ₹9,450
• 998719: qty 10, taxable ₹20,000, CGST ₹1,800, SGST ₹1,800

Total taxable ₹8,76,000 and total tax ₹1,46,240, which must equal his Table 7 B2C total for the month. Because the codes were fixed in the item master, the summary took two minutes; the risk of a typed "8258" for a TV never arose. He also prints the HSN on the shelf and product labels so staff pick the right item at billing.

Common errors

• Mixing up HSN and SAC. Putting 9983 on a goods line or 8517 on a service line. Services always start with 99.
• Printing too few digits. A 2-digit chapter code on a B2B invoice for a business above ₹1.5 crore was acceptable before April 2021; it is not now.
• Using the supplier's code blindly when the product changes. Fabric bought under 5208 and sold as a stitched kurta is 6204 or 6211; job work changes the code.
• Classifying by use instead of form. A steel rack used in a kitchen is still furniture (9403), not kitchenware.
• Ignoring price and packaging conditions. The same 6403 footwear heading is 5% or 18% depending on the sale price per pair; the code does not change but the rate does.
• Wrong UQC in Table 12. Reporting fabric in NOS instead of MTR, or leaving quantity blank for goods.
• Different codes on the invoice, the e-way bill and the return. The portals cross-check; keep one item master.
• Not updating after a rate change. When an entry moved from 12% to 5% in September 2025, the HSN stayed the same but the item master rate needed a change.
• Composite supplies. A laptop with a bag is classified as a laptop (8471); do not invent a separate code for the free bag.

How VyaparKit helps

The HSN and SAC lookup is free and needs no login; search by description or code and read the heading before you commit. In the GST invoice tool each saved item carries its HSN or SAC and rate, so every invoice line and the GST report's HSN grouping come from one master. Product labels and the barcode generator let you print the code and a scannable barcode on shelf labels so billing staff pick the right item. VyaparKit does not validate classification for you; the code you choose is your responsibility, so check it once, carefully.

Next steps

• Find last year's aggregate turnover and note whether you need 4 or 6 digits (8 if you export).
• Build an item master with description, HSN or SAC, unit, and rate for every item you sell.
• Cross-check the top 20 items against your supplier invoices and the current rate schedule.
• Make the code a mandatory field at invoicing so Table 12 fills itself.
• Review the master after every GST Council rate change.