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SAC codes

SAC code for commercial rent: 997212

Rent on a shop, office or shed carries GST, and who pays it depends on whether the landlord is registered. Here is the code, the rate and the rules.

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In short

Commercial rent is billed under SAC 997212, usually at 18% GST. A registered landlord charges it; a registered tenant of an unregistered landlord pays it under reverse charge. SimpleERP prints the code on each monthly rent invoice.

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

SAC 997212 at a glance

ItemValue
6-digit SAC997212: Rental or leasing services involving own or leased non-residential property
4-digit group9972
Chapter 99 headingReal estate services
Usual GST rate18% under forward charge for a registered landlord
Reverse chargeReverse charge when an unregistered landlord rents commercial property to a registered tenant, as notified; forward charge for a registered landlord.
ExemptionRenting a residential dwelling for use as a residence is exempt, but rent to a registered person is under reverse charge, as notified.
Who typically bills itOwners of shops, offices, godowns and factory sheds
SAC 997212 as classified by CBIC, checked on the verified date below. Rates change, so confirm the rate for your goods or services with your CA or the GST portal before you rely on it.

Sources: CBIC: classification of services (SAC), CBIC: GST rates and notifications. Verified .

Which SAC code goes on a commercial rent invoice?

The usual SAC code for commercial rent is 997212: rental or leasing services involving own or leased non-residential property. It sits in group 9972, real estate services, under chapter 99, the chapter that holds every service code in the GST classification. Renting out a shop, office, godown or factory space you own or lease takes this code. Residential rent has its own code, 997211, and different rules.

What GST rate applies to commercial rent?

Commercial rent is usually charged at 18% GST by a registered landlord, on the monthly rent and any maintenance charged with it. Rates change, so confirm the rate for your goods or services with your CA or the GST portal before you rely on it.

  • Residential rent goes under 997211 and is exempt for use as a residence, with a reverse charge exception
  • Maintenance charges billed with the rent are usually taxed with it
  • Renting of machinery is a different supply under heading 9973

A commercial rent invoice line in SimpleERP

Lakshmi Steel Furnitures lets a spare bay in its Peelamedu shed to a parts dealer for ₹40,000 a month. The rent line carries SAC 997212 at 18%, so the invoice shows CGST ₹3,600 and SGST ₹3,600, a total of ₹47,200.

  • SAC 997212 sits on the line from the saved service, so nobody types it per invoice
  • Place of supply picks CGST and SGST for a client in your state, or IGST for one in another
  • The HSN/SAC summary groups every line by code, ready for the GSTR-1 HSN table

Illustration of the keyboard-first invoice editor with a focused line, live tax totals and shortcut hints.

When is reverse charge or an exemption involved?

As notified, when a landlord who is not registered rents commercial property to a registered tenant, the tenant pays the GST under [reverse charge](/glossary/reverse-charge-mechanism). Residential rent is exempt for use as a residence, but rent of a residential dwelling to a registered person is under reverse charge, with notified exceptions. Check the GST portal for the current entries.

  • A tenant under the composition scheme has been excluded from the commercial rent reverse charge, as notified; check
  • A registered landlord charges GST on the invoice as usual
  • When reverse charge applies, SimpleERP has no reverse charge switch, so leave GST off the line and write the reverse charge wording in the invoice notes

Sources

FAQ

Questions, answered

Is SAC mandatory on my commercial rent invoice?

Yes, on B2B invoices: four digits (9972) up to ₹5 crore turnover and six digits above it. Printing 997212 shows the tenant at once that this is non-residential rent, which decides their credit and reverse charge position.

Can I use 9972 instead of 997212?

Up to ₹5 crore turnover, 9972 meets the four-digit rule on B2B invoices. Above it, use 997212. Since 9972 also holds residential rent, which is exempt or under reverse charge, the six digits avoid a wrong reading.

Does reverse charge apply to commercial rent?

Sometimes. When an unregistered landlord rents commercial property to a registered tenant, the tenant pays the GST under reverse charge, as notified, and residential rent to a registered person works the same way. A registered landlord charges GST on its own rent invoice under forward charge; check the GST portal for the current entries.

What if my client is in another state?

For rent, the place of supply is where the property is. A Bengaluru tenant renting your Coimbatore shed pays CGST and SGST, not IGST. In SimpleERP a ship-to address for the property sets the place of supply on the invoice.

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