SAC codes
SAC code for rental of machinery: 997319
Hiring out a machine is a leasing service whose rate follows the machine itself, and supplying an operator who does the job can turn it into a different service.
In short
Renting out machinery and equipment uses SAC 997319, or 997313 for construction machinery, usually taxed at the rate that applies to selling the same machine. SimpleERP prints the SAC and hire period on each rental line.
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 997319 at a glance
| Item | Value |
|---|---|
| 6-digit SAC | 997319 (997313 for construction machinery) |
| 4-digit group | 9973: leasing or rental services with or without operator |
| Chapter 99 heading | Leasing or rental services concerning other machinery and equipment with or without operator |
| Usual GST rate | The rate on a sale of the same machine, 18% for most industrial machinery (as notified; check the GST portal) |
| Reverse charge | Forward charge for most suppliers: the hire company charges GST |
| Exemption | No general exemption; hire of some agricultural machinery for farming operations can be exempt as notified |
| Who typically bills it | Equipment hire firms, crane and forklift owners, generator and compressor rental companies |
Sources: CBIC: classification of services (SAC), CBIC: GST rates and notifications. Verified .
Which SAC code goes on a machinery rental invoice?
Use 997319, leasing or rental services concerning other machinery and equipment with or without operator. It sits in group 9973, leasing or rental services with or without operator, under chapter 99 (services), in the 99731 family. Cranes, excavators and concrete mixers for building sites are 997313, construction machinery and equipment; office equipment and computers have their own siblings.
Lakshmi Steel Furnitures hires a 5-tonne forklift for two months during a plant expansion from Kovai Equipment Hire in Coimbatore, Tamil Nadu, which bills the monthly hire under 997319.
What GST rate applies to rental of machinery?
As notified, leasing or rental with or without operator, outside the specific entries, carries the same rate as a sale of the same goods. For most industrial machinery that is 18%, so ₹90,000 of monthly forklift hire in your state carries ₹8,100 CGST and ₹8,100 SGST. Machines whose goods rate changed on 22 September 2025 change the hire rate too. Rates change, so confirm the rate for your goods or services with your CA or the GST portal before you rely on it.
- Without operator: a pure hire at the machine's rate
- With operator who only runs the machine: usually still a hire under 9973
- With operator who does the job, such as excavation: can be the job's own service
- Diesel and transport billed in the hire are part of the value
A machinery rental invoice line in SimpleERP
Save Forklift hire as a service with SAC 997319, the unit Month, Day or Hours and the machine's rate. Put the machine number and hire period in the line description.
- SAC 997319 prints on the hire line
- Place of supply picks CGST plus SGST or IGST from the customer's state
- Hire lines sit under 997319 in the HSN/SAC summary for GSTR-1
- Operator charges billed separately get their own line
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?
Machinery hire is under forward charge. The exemption that comes up is agriculture: renting or leasing agro machinery for agricultural operations directly related to production of agricultural produce can be exempt as notified. Hire with an operator who carries out construction work can be classified as that construction service instead, so check the contract with your CA.
- Forward charge on machinery hire
- Agro machinery for farming operations: can be exempt
- Operator doing the work: classification can shift to the work
- Rent of buildings and sheds is a different code, see commercial rent
FAQ
Questions, answered
I rent out a JCB with an operator for site work. Is it 997313?
If the client directs the work and you supply the machine with someone to run it, it is commonly a hire under 997313. If you take responsibility for the excavation itself, priced by the job, it can be a construction service. Read the contract and confirm the code with your CA.
Why does the GST on hire depend on the machine?
As notified, rental with or without operator outside the specific entries takes the same rate as a sale of like goods. So hiring a machine taxed at 18% when sold is usually 18%, and a machine with a lower goods rate rents at that lower rate.
Do I charge GST on the diesel the client asked me to supply?
If the diesel is part of your hire charge, it is part of the value of the rental and takes the same rate. If the client buys fuel directly, it stays off your invoice. Avoid billing fuel as a separate reimbursement unless your CA agrees.
Do I need to issue an invoice every month for a long hire?
For continuous supply of services, an invoice is due on or before each payment due date in the contract. Monthly hire is usually billed monthly. SimpleERP numbers each invoice in your April to March series.
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