What it means
Goods use HSN codes; services use SAC codes from the same chapter scheme, all inside chapter 99. A SAC code has six digits: 99, then a two-digit heading, then a group and a service. For example, heading 9983 covers other professional, technical and business services, and 9965 covers goods transport services. The same digit rules that apply to HSN apply on invoices for services.
Example
A Bengaluru consulting firm bills Kaveri Agencies ₹50,000 for a stock-control review.
| Line | Value |
|---|---|
| SAC | a six-digit code under heading 9983 |
| Taxable value | ₹50,000 |
| CGST 9% + SGST 9% | ₹9,000 |
| Invoice total | ₹59,000 |
If the firm also billed freight, that line would sit under heading 9965, which has its own rate and may fall under reverse charge.
Common mistakes
- Putting an HSN code on a service line, or the other way round.
- Using one SAC for every service you sell when the rates differ, for example consulting and transport.
- Missing that some services under certain SAC headings are taxed on the buyer under reverse charge.
In MyRecords
Service items carry a SAC code in the same field as goods carry HSN, and the GST tax invoice prints it on each line. The GSTR-1 file includes services in the HSN-wise summary, and the free HSN/SAC finder looks up codes by description.