Published on May 27, 2025Updated on Nov 10, 2025
Understanding SAC codes in GST is crucial for smooth tax compliance if you’re a service provider or run a service-based business in India. The full form of the SAC code is Services Accounting Code. It is a system introduced under the GST (Goods and Services Tax) regime to classify and identify different types of services.
Every service, from consulting to logistics, has a unique SAC code that helps streamline GST invoicing and returns. Not using the correct code can lead to compliance issues, penalties, or delays in Input Tax Credit (ITC) claims.
Whether you're a new entrepreneur or an established service provider, knowing how these codes work and how to find SAC codes can help you stay tax-compliant and avoid unnecessary hassle.
A SAC code is a six-digit number assigned to every service under the GST regime. It helps classify services clearly and assign appropriate tax rates.
While HSN codes are used for goods, SAC codes are specifically meant for services. These codes are based on the United Nations Central Product Classification (UNCPC) but modified to suit India’s requirements by the Central Board of Indirect Taxes and Customs (CBIC).
Under GST, services are taxed at five different rates: 0%, 5%, 12%, 18%, and 28%.
If a service isn’t specifically listed, an 18% GST rate generally applies by default.
Businesses must ensure that the correct GST SAC code is applied to avoid complications during tax filing or audits.
If you're offering any kind of service, knowing your exact service accounting code is key to accurate GST compliance in India.
Each SAC code uniquely identifies a service. It simplifies classification for businesses and tax authorities.
SAC codes help to identify which GST rate applies to a service.
During GST registration, businesses must specify the relevant SAC codes to indicate the nature of the services they offer.
All invoices must carry the SAC code for services provided. This keeps billing transparent and makes it easier for clients to understand tax implications.
When filing GST returns, using the correct SAC codes ensures accurate and compliant tax reporting.
Using the right SAC code in GST is not just about compliance; it also plays a key role in several areas of your business:
SAC codes bring structure to the GST classification of services, ensuring that businesses apply the correct tax rate and maintain compliance. They also help tax authorities track service-based transactions and improve overall transparency.
Here’s how a typical SAC code is structured:
|
Part of Code |
Meaning |
|
First 2 Digits |
Always "99" for services |
|
Next 2 Digits |
Major category (e.g., 54 = construction) |
|
Last 2 Digits |
Specific service (e.g., 11 = general construction) |
For instance, 995411 refers to general construction services for buildings.
Using the correct SAC code ensures that the right GST rate is applied, reducing the risk of mismatches or red flags during audits.
Services and goods are taxed differently under GST, with unique codes that determine their applicable tax rates. Here's how they compare:
|
Type |
Classification Code |
Used For |
Applicable GST Rates |
|
Services |
SAC (Services Accounting Code) |
Identifying and taxing services |
0%, 5%, 12%, 18%, or 28% |
|
Goods |
HSN (Harmonised System of Nomenclature) |
Classifying goods for trade and GST |
0%, 0.25%, 3%, 5%, 12%, 18%, or 28% |
While SAC is India-specific for services, HSN is globally recognised for goods classification. Correct use of these codes ensures accurate GST compliance in India.
Whether you're billing clients or filing returns, selecting the correct GST SAC code for your services is essential.
Some commonly used SAC codes for transport services include:
|
SAC Code |
Description |
|
996511 |
Transport services for goods by road |
|
996512 |
Transport services for goods by railway |
|
996513 |
Transport services for goods (such as petroleum and natural gas) by pipeline |
|
996521 |
Transport services for goods via water (coastal and transoceanic) |
Some commonly used SAC codes for vehicle rental services include:
|
SAC Code |
Description |
|
996601 |
Road vehicle rental services (with or without operator) |
|
996602 |
Water vessel rental services (with or without operator) |
|
996603 |
Aircraft rental services (with or without operator) |
Some commonly used SAC codes for real estate services involving owned or leased property include:
|
SAC Code |
Description |
|
997212 |
Rental or leasing of non-residential property |
|
997211 |
Rental or leasing of residential property |
|
997214 |
Time-share property-related services |
|
997213 |
Trade services for buildings |
|
997215 |
Trade services for vacant or sub-divided land |
Here’s how to find SAC codes for a property:
|
Annual Turnover |
SAC Requirement |
|
Over INR 5 crore |
Full 6-digit SAC required |
|
Under INR 5 crore (B2B) |
4-digit SAC required |
|
Under INR 5 crore (B2C) |
SAC optional, only 4 digits required when used |
|
Unregistered Dealers |
Not required |
Non-compliance can result in penalties of INR 25,000 each under the CGST & SGST acts or INR 50,000 under the IGST act.
|
Factor |
SAC Code |
HSN Code |
|
Applies To |
Services |
Goods |
|
Format |
6 digits or 4 digits |
8 digits |
|
Based On |
UNCPC; modified for India by CBIC |
WCO (World Customs Organisation) HSN |
|
Example |
998314 (IT design and development services) |
62011210 (cotton raincoats) |
Understanding the meaning of the SAC code in GST is essential for every service-based business in India. Whether you're in consultancy, transport, or real estate, using the correct SAC code helps ensure compliance, minimise errors, and streamline your GST filing process.
Maintaining accurate GST records with the right SAC codes not only fulfils legal obligations but also enhances your financial transparency – something especially valuable when you're seeking to grow or secure business funding.
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To find an HSN or SAC code on the GST Portal, log in and navigate to the portal’s search functionality. Here, you can enter a service description or relevant keywords to get the corresponding code.
SAC code 996111 pertains to services provided for a fee/commission or contract basis in wholesale trade.
SAC code 997221 refers to property management services provided on a fee/commission basis or contract basis.
In India, the SAC (Services Accounting Code) is a system for classifying services under GST. Each service is assigned a unique code to determine the applicable GST rate.
The SAC code should be mentioned on GST invoices, during GST registration, and in GST returns. Proper inclusion ensures accurate tax classification and compliance.
Yes, mentioning the SAC code on invoices is mandatory under GST regulations. It ensures correct tax classification and helps avoid penalties.
The SAC code for financial consultancy services is 997156.
SAC code 9983 covers various professional services, including business, IT, and management consulting.
To add a SAC code to your GST registration, log in to the GST portal, navigate to 'Amendment of Registration,' and update the relevant service details with the appropriate SAC codes.
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