Glossary
What is a SAC code?
The service world's version of the HSN code, printed on every service invoice line.
Updated
In short
A SAC code, Services Accounting Code, classifies services for GST and links each to its rate. In SimpleERP a service product carries its SAC code, which prints on every invoice line and appears in the HSN summary.
A SAC code, Services Accounting Code, classifies services for GST in the way HSN codes classify goods. Every SAC code starts with 99, followed by digits for the service group and type, such as 9987 for maintenance, repair and installation services. The code links to the service's GST rate, prints on every service invoice line and is reported in the HSN summary of GSTR-1.
SAC code: a worked example
Lakshmi Steel Furnitures also services the racks it sells. It bills Sri Murugan Traders ₹5,000 for an annual maintenance visit under SAC 9987. Assuming 18% GST, the invoice shows CGST ₹450 and SGST ₹450, a total of ₹5,900, with the rack sale lines carrying HSN 9403 on the same invoice. Rates change, so confirm the rate for your goods with your CA or the GST portal before you rely on it.
FAQ
Questions, answered
How many digits of the SAC code do I need to show?
The same rule as HSN codes: four digits for aggregate turnover up to ₹5 crore on B2B invoices and six digits above it. Many service businesses print the full six digits anyway because it removes doubt about the exact service.
Can one invoice have both HSN and SAC codes?
One invoice can carry both HSN and SAC codes. When a business sells goods and services together, such as racks with an installation charge, each line carries its own code. If the goods and service form one composite supply, the principal supply decides the rate, so check with your CA.
Where do I find the SAC code for my service?
The SAC list is published by CBIC and searchable on the GST portal. Look for the heading that describes the service you provide, not the industry you are in, and confirm with your CA when a service could fit two headings.
Is the GST rate the same for all services under one SAC heading?
The GST rate is not always the same across one SAC heading. Some headings carry different rates or exemptions depending on who receives the service or how it is provided. Check the rate notification for the exact entry, and confirm the rate with your CA before you bill.
Related
Keep reading
HSN code
The number that classifies goods for GST and customs, and so decides their GST rate.
Read moreProfessional services
SAC-coded invoices with place of supply, quotations, a CRM pipeline, expense claims and payroll.
Read moreTax invoice
The document a GST-registered business issues for a taxable sale, with the mandatory GST fields.
Read more
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