HSN Requirments under Goods and Services Tax Law
Not all Suppliers need to mention HSN code on their invoices issued
- Taxpayers whose turnover is above Rs. 1.5 crores but below Rs. 5 crores shall mention 2 digit code on Invoice.
- Taxpayers whose turnover is Rs. 5 crores and above shall mention 4 digit code on Invoice
- Taxpayers whose turnover is below Rs. 1.5 crores are not required to mention HSN Code in their invoices.
1 How will the goods and services be classified under GST regime?
HSN (Harmonised System of Nomenclature) code shall be used for classifying the goods under the GST regime. Taxpayers whose turnover is above Rs. 1.5 crores but below Rs. 5 crores shall use 2-digit code and the taxpayers whose turnover is Rs. 5 crores and above shall use 4-digit code. Taxpayers whose turnover is below Rs. 1.5 crores are not required to mention HSN Code in their invoices. Services will be classified as per the Services Accounting Code (SAC)
HSN Sections
Below is the list of standard HSN Sections, these are standard across all countries and economies.
- Section I (Chapters 1 to 5) – live animals and animal products
- Section II (Chapters 6 to 14) – vegetable products
- Section III (Chapter 15) – animal or vegetable fats and oils
- Section IV (Chapters 16 to 24) – beverages, spirits, vinegar, and tobacco
- Section V (Chapters 25 to 27) – mineral products
- Section VI (Chapters 28 to 38) – chemical and para-chemical products
- Section VII (Chapters 39 to 40) – plastics and rubber, and articles thereof
- Section VIII (Chapters 41 to 43) – certain animal hides and skins
- Section IX (Chapters 44 to 46) -wood, cork, manufactures of straw, and articles thereof
- Section X (Chapters 47 to 49) – pulp of wood, paper, paperboard, and printed products
- Section XI (Chapters 50 to 63) – textiles and textile articles
- Section XII (Chapters 64 to 67) – footwear, headgear, umbrellas, walking sticks, prepared feathers, artificial flowers, and articles of human hair
- Section XIII (Chapters 68 to 70) – articles made of minerals, stone, plaster, cement, etc., and ceramic and glass products
- Section XIV (Chapter 71) – precious metals and stones
- Section XV (Chapters 72 to 83) – base metals and articles thereof (Note: Chapter 77 is reserved for future use)
- Section XVI (Chapters 84 to 85) – machinery and mechanical appliances, electrical equipment, sound recorders and reproducers, television image and sound recorders and reproducers, and parts and accessories of such articles
- Section XVII (Chapters 86 to 89) – vehicles, aircraft, vessels, and associated transport equipment
- Section XVIII (Chapters 90 to 92) – optical, photographic, cinematographic, and musical apparatus and equipment; measuring, medical, surgical, and other instruments; and clocks and watches
- Section XIX (Chapter 93) – arms and ammunitions
- Section XX (Chapters 94 to 96) – miscellaneous manufactured articles
- Section XXI (Chapters 97 to 99) – arts, collector’s pieces, and antiques (Note: Chapter 99 is reserved for national use)