SAC codes
SAC codes and GST rates for IT companies and digital agencies
A web app built, a server looked after, a month of ads run, a licence resold. Each sits under its own SAC code, nearly all of them in group 9983.
In short
IT companies bill software development under SAC 998314, IT support under 998313 and hosting under 998315, usually at 18%. SimpleERP keeps the SAC code on each service, prints it on the invoice and groups it in the HSN summary.
Illustration of GST tax invoice INV-2026-27-0213 to Ravi Stores with CGST 9% and SGST 9%, round off, a UPI QR code and the amount in words.
The data
The codes and usual rates
| SAC | Service | Usual GST rate | Notes |
|---|---|---|---|
| 998311 | Management and IT strategy consulting | 18% | Check against 998313 for pure IT advice |
| 998313 | IT consulting and support | 18% | Helpdesk, AMC support, IT advice |
| 998314 | IT design and development | 18% | Custom software, websites, mobile apps |
| 998315 | Hosting and IT infrastructure provisioning | 18% | Servers, cloud hosting, storage |
| 998316 | IT infrastructure and network management | 18% | Managed services and network upkeep |
| 998319 | Other IT services not elsewhere classified | 18% | Check whether a closer code fits |
| 997331 | Licensing the right to use software | 18% | Software licences and subscriptions you resell |
| 998713 | Maintenance and repair of computers | 18% | Hardware repair and servicing |
| 998361 | Advertising services | 18% | Campaign planning and creative |
| 998371 | Market research | 18% | Surveys, user research |
| 998391 | Specialty design services | 18% | UI, graphic and brand design |
| 998392 | Design originals | 18% | Original artwork and design files |
| 999293 | Commercial training and coaching | 18% | Corporate tech training; check exemptions |
| 998512 | Permanent placement | 18% | Recruitment fees |
| 997212 | Rental of commercial property | 18% | Rent on your office; reverse charge in some cases |
Sources: CBIC: Customs tariff (HSN chapters), GST Council: rate changes effective 22 September 2025, CBIC: GST rates and notifications. Verified .
Which SAC codes does an IT company use most?
IT work sits in SAC group 99831, under heading 9983 for other professional, technical and business services. Consulting and support is 998313, design and development of software, websites and apps is 998314, hosting is 998315 and managed infrastructure is 998316. Software sold as a licence moves to 997331, the licensing of rights to use software.
Digital agencies reach into 99836 for advertising and 99839 for design. See software development, website development and digital marketing for single-code detail.
How to check a rate before billing
IT services were not moved by the 22 September 2025 changes and mostly stay at 18%. What still changes the tax on an invoice is who the client is and where they are.
- Match the code to the deliverable: a support retainer is 998313, a build project 998314, a resold licence 997331.
- Export of services: work for a client outside India, paid in foreign exchange, can be zero-rated under a LUT; check the conditions with your CA.
- Place of supply from the client's GSTIN decides CGST and SGST or IGST.
- Mixed contracts: if a project bundles hardware and services, ask your CA how to split it. Rates change, so confirm the rate for your goods or services with your CA or the GST portal before you rely on it.
HSN on invoices and the GSTR-1 HSN summary in SimpleERP
Each service an agency sells, from a design sprint to a hosting plan, becomes a product with its SAC code and rate. The code prints on the invoice and the month's billing groups by code in the HSN summary.
- Service products for each line of business, each with its SAC.
- Retainers raised by hand each month by picking the client and the saved service.
- The HSN summary totals development, support and hosting by SAC for GSTR-1, with a CSV export.
- Sales register for the monthly check before your CA files.
Illustration of a profit and loss statement for April to September 2026 with net profit of ₹4,12,800, a GST summary and the lock date.
Inputs and input tax credit for IT companies
An IT firm's inputs are cloud bills, software subscriptions, laptops, rent and freelancers. Indian vendors charge GST that you claim back; foreign cloud and software vendors are a reverse charge question for your CA.
- Laptops and servers are claimed as credit and can sit in the fixed asset register with depreciation.
- Cloud and software from abroad is usually an import of services, often under reverse charge.
- Freelancers registered for GST bill you with tax; unregistered ones do not.
- The purchase register lists cloud, software and rent bills with their tax for the monthly credit check.
Honest limits
Not included yet
- Invoices in foreign currency
- Recurring invoices that raise themselves
FAQ
Questions, answered
What is the SAC code for IT services?
IT services usually fall under SAC group 99831: 998313 for IT consulting and support, 998314 for software and website development, 998315 for hosting and 998316 for infrastructure management. All four are commonly billed at 18%. Match each invoice line to the service actually delivered.
What is the SAC code for software development?
Design and development of software, websites and apps usually falls under SAC 998314, IT design and development services, commonly at 18%. A licence to ready-made software sits under 997331 instead. Confirm the code with your CA if a contract mixes both.
Is GST charged on IT services exported abroad?
Services to a client outside India, paid in convertible foreign exchange, can qualify as an export and be zero-rated, usually under a letter of undertaking. SimpleERP bills in rupees only, so record the rupee value on the invoice. Check the export conditions with your CA.
What is the SAC code for digital marketing?
Campaign planning and creative work usually falls under SAC 998361, advertising services, commonly at 18%. Selling ad space or time sits in nearby codes under 99836, and design work under 998391. Pick the code that matches each line of the agency's invoice.
Related
Keep reading
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Milestone, retainer, AMC and hosting invoices with SAC 9983 codes, IGST for clients outside Kerala and part-billing against a signed order.
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Pipeline to SAC-coded retainer invoices, payroll for a salaried team and a laptop register.
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The code that classifies services for GST, as HSN codes do for goods.
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