HSN and SAC codes
HSN and SAC codes for manpower and staffing agencies
A staffing invoice is mostly wages passed through, with a margin on top, and GST applies to the whole of it. Here are the codes agencies usually bill under.
In short
Manpower and staffing agencies bill under SAC group 99851, such as 998513 for contract staffing and 998512 for placement, usually at 18%. SimpleERP prints the code on every line and builds the HSN summary for GSTR-1.
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
| Code | Goods or service | Usual GST rate | Notes |
|---|---|---|---|
| 998511 | Executive search services | 18% | Retained or contingent search for senior roles. |
| 998512 | Permanent placement services | 18% | Fee for a hire who joins the client's own payroll. |
| 998513 | Contract staffing services | 18% | Staff on your payroll working at the client. |
| 998514 | Temporary staffing services | 18% | Short assignments and seasonal cover. |
| 998515 | Long-term staffing (payrolling) services | 18% | Client picks the people, you carry them on your payroll. |
| 998516 | Temporary staffing to permanent placement | 18% | Temp-to-hire conversions. |
| 998517 | Co-employment staffing services | 18% | Shared employer arrangements. |
| 998519 | Other employment and labour supply services | 18% | Labour supply not covered above; check the fit. |
| 998533 | Cleaning services | 18% | Housekeeping staff billed as a cleaning service. |
| 998531 | Disinfecting and pest control services | 18% | Confirm the six digits for the work. |
| 3926 | PVC ID cards and holders | 18% | Plastic articles; check the heading for the card type. |
| 6307 | Lanyards and other made-up textile articles | 5% | Up to ₹2,500 per piece; check the rate. |
| 6203 | Uniform trousers and suits | 5% | Up to ₹2,500 per piece; 18% above. |
| 6205 | Uniform shirts | 5% | Same ₹2,500 per piece threshold. |
| 6403 | Safety and work shoes | 5% | Up to ₹2,500 per pair; 18% above. Check the heading for the material. |
Sources: CBIC: classification of services (SAC), CBIC: Customs tariff (HSN chapters), GST Council: rate changes effective 22 September 2025. Verified .
Which HSN and SAC codes does a manpower and staffing agency use?
A staffing agency sells people's time. Contract staffing, temporary staffing, payrolling, permanent placement and executive search each have their own six-digit code in SAC group 99851, and the client may also buy housekeeping or facility services from the same agency. The goods are few: ID cards, lanyards, uniforms and safety shoes, bought for the people you deploy. GST is charged on the full invoice value, including the wages you pass through, not only on your service charge.
How to check a rate before billing
Staffing services stayed at 18% through the 22 September 2025 changes, but the contract you sign decides the code and any exemption. Check before the first invoice of a new client. Rates change, so confirm the rate for your goods or services with your CA or the GST portal before you rely on it.
- Read the contract: is it supply of staff, a placement fee, payrolling or a housekeeping service? Each has its own code.
- Look up the six digits in the SAC list that CBIC publishes, and the rate in the current rate notification.
- Check whether the client is a government body; some services to government are exempt as notified.
- Ask your CA once, then set the code and rate on the service in SimpleERP so every later invoice repeats it.
HSN and SAC on invoices and the GSTR-1 summary in SimpleERP
Set up one service per role or contract type and every monthly invoice reuses the code and rate.
- One service per role, such as helper, operator or data entry, each with its SAC code and rate.
- Wages and service charge can sit on separate lines of the same invoice, both taxed at the service rate.
- CGST and SGST or IGST from the client's place of supply.
- HSN summary report by code, exported to CSV for your CA. SimpleERP does not file the return.
- Deployed staff run through payroll with PF, PT and TDS on the payslip.
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.
Reverse charge and exemptions that touch manpower agencies
Staffing is usually taxed under forward charge. The exceptions below are as notified; check each with your CA.
- Pure services to a government body linked to a function of a panchayat or municipality may be exempt.
- Security staff supplied by an agency that is not a company falls under reverse charge in the client's hands; see security services.
- Rent-a-cab and transport you buy for staff may fall under reverse charge depending on the supplier.
- SimpleERP has no reverse charge flag on invoices; put the wording in the invoice notes.
Honest limits
What SimpleERP does not do here
- A reverse charge flag. Use the invoice notes for the wording.
- An ESI preset on payslips. Confirm ESI treatment with your CA.
- Biometric attendance devices, e-invoice IRN and GST return filing.
FAQ
Questions, answered
What is the SAC code for manpower supply?
Manpower supply sits in SAC group 99851. Contract staffing is usually 998513, temporary staffing 998514, payrolling 998515 and other labour supply 998519. The usual rate is 18%. Choose the code that matches what the contract actually provides, and confirm it against the SAC list.
Is GST charged on the full invoice or only on our service charge?
On the full value. When you supply staff, the wages and statutory costs you recover are part of the value of your service, so GST applies to the total, not only to your margin. A pure agent arrangement is narrow and needs your CA's view.
Can I bill a client every month without retyping the invoice?
Set up each role as a service with its SAC code and rate, then raise the invoice with the headcount or days for the month. The code, rate and place of supply follow from the service and the client.
What is the SAC code for a placement fee?
A fee for placing a candidate on the client's own payroll is usually billed under 998512 for permanent placement, or 998511 for executive search. The usual rate is 18%. Confirm against the SAC list.
Related
Keep reading
GST billing for manpower agencies
Monthly manpower supply invoices from man-days, rate and service charge, with SAC codes and the right GST split.
Read moreManpower and staffing
Monthly client invoices with SAC codes, payroll for deployed workers with PF and advances, and client receivables.
Read moreSAC code
The code that classifies services for GST, as HSN codes do for goods.
Read more
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