HSN/SAC Classification Rules and Digit-Length Requirements
Every taxable supply of goods must be classified under the Harmonized System of Nomenclature (HSN) code, and every supply of services under the Services Accounting Code (SAC), both mandatorily declared on tax invoices and in GSTR-1 filings under Rule 46 of the CGST Rules. Incorrect classification is not a harmless labeling error — it can result in the wrong GST rate being charged, denial of ITC to the recipient, and penalty exposure under Section 122 for the supplier.
The number of digits required depends on annual aggregate turnover in the preceding financial year, per Notification No. 78/2020-Central Tax: taxpayers with turnover up to ₹5 crore must declare a minimum 4-digit HSN code (2-digit for B2C supplies is optional but 4-digit is now standard practice for GSTR-1 reporting), while taxpayers above ₹5 crore turnover must declare the full 6-digit HSN code on all tax invoices and returns.
GST rates are structured around a small number of standard slabs (nil, 5%, 12%, 18%, 28%, plus compensation cess on select items), but the correct slab for any given product depends entirely on its precise HSN classification — two visually similar products can sit in different HSN chapters and attract different rates, which is why relying on a competitor's invoice or informal industry practice for classification is risky.
This finder searches the current CBIC HSN/SAC master list and returns the matching code(s), applicable GST rate, and any relevant exemption notification, so you can classify correctly before invoicing rather than discovering a mismatch during a GSTR-1 vs e-invoice reconciliation or a departmental audit.
Example Lookups
Sample classification results for commonly searched items.
Frequently Asked Questions (FAQs)
How many digits of HSN code must I show on my invoice?
4 digits if your annual aggregate turnover in the preceding financial year was up to ₹5 crore, and 6 digits if it exceeded ₹5 crore, per Notification No. 78/2020-Central Tax. Full 8-digit HSN is required only for specific notified categories (e.g. certain chemicals, and on export/import documentation).
Is SAC the same numbering system as HSN?
No, they are parallel but distinct systems — HSN classifies goods (an international customs-based system), while SAC classifies services under a scheme maintained specifically for Indian GST purposes. Both are declared in the same invoice fields depending on whether the supply is goods or services.
What happens if I use the wrong HSN code on an invoice?
It can result in charging the wrong GST rate (under- or over-charging), mismatches between your GSTR-1 and the recipient's GSTR-2B that can delay or deny their ITC claim, and penalty exposure under Section 122 for incorrect invoicing, in addition to potential demand and interest if the correct rate was actually higher.
Does a mixed supply of goods and services use HSN or SAC?
It depends on how the supply is classified under Section 8 of the CGST Act (composite vs. mixed supply rules) — the dominant/principal supply typically determines whether HSN or SAC applies and at what rate; genuinely mixed supplies with no principal element are taxed at the highest rate among the constituent supplies.
Are GST rates the same across all states for a given HSN code?
Yes, GST rates are uniform nationally for a given HSN/SAC classification — CGST and SGST/UTGST are simply the two equal halves of the same total rate for intra-state supply, and IGST equals the same total rate for inter-state supply; there is no state-by-state rate variation for the same HSN code.