Tax

HSN and SAC codes on invoices: what they are and how many digits

What HSN and SAC codes are, how many digits your invoices need for your turnover, how to find the right code, and where the codes end up in GSTR-1.

14 Nov 2026 · 6 min read

One code, two digits at a time. Small businesses show the first four on B2B invoices, larger ones six.

A garment maker in Tiruppur sells cotton T-shirts to a retailer in Kochi. The retailer's accountant asks for the HSN code on the invoice. The maker writes “61”, because that is what an old invoice from a supplier showed. It is not enough. Two digits say “knitted clothing”. The rule asks for at least four.

What HSN and SAC codes are

HSN (Harmonized System of Nomenclature) is a worldwide list of goods, kept by the World Customs Organization. Every product has a number, and the longer the number, the more exact it is. India uses up to eight digits. SAC (Services Accounting Code) is India's list for services. SAC codes are six digits and all start with 99.

The code matters for two reasons. It tells the tax office what you sold, and it decides the GST rate. Two products that sound alike can sit under different codes at different rates, so the code is the first thing to get right, and the rate follows from it.

How a code is built

2 digits, chapter: 61 is knitted clothing, 85 is electrical machinery, 99 is services.
4 digits, heading: 6109 is T-shirts and vests. 8517 is telephones, including mobile phones.
6 digits, subheading: 610910 is T-shirts of cotton. These six are the same in every country that uses HSN.
8 digits, tariff item: India's own last two digits, as in 61091000.

Services work the same way: 9983 is other professional, technical and business services, and the six-digit codes under it split that into consulting, IT design and development, design work and so on.

How many digits your invoices need

Turnover in the last financial year	B2B invoices	B2C invoices
Up to ₹5 crore	4 digits	Optional
Above ₹5 crore	6 digits	6 digits

This has been the rule since 1 April 2021, under Notification 78/2020-Central Tax. “Turnover” here is your aggregate turnover across India on one PAN. More digits are always allowed. Many businesses show six or eight anyway, because the same code then works on every invoice and in every return. For services, the SAC is six digits in any case, so just use it in full.

How to find yours

Search the GST portal. The portal has a public HSN and SAC search that needs no login. Type a word like “T-shirt” or “consulting” and read the descriptions it returns.
Look at your purchase invoices. If you resell goods, your supplier's invoice already carries a code. Check it against the description, not just copy it.
Check the rate schedule. Once you have a code, the GST rate notifications list the rate for it. Since September 2025 most goods and services are at 5% or 18%.
Ask your CA when a product could fit two headings. A wrong code can mean the wrong rate on every invoice until someone notices.

Do this once per product or service and save it with the item. You should not be choosing a code each time you write an invoice.

Where the codes go next: GSTR-1

Every month or quarter, GSTR-1 asks for an HSN-wise summary in Table 12: for each code and rate, the total quantity, its unit (UQC, such as NOS or KGS), the taxable value and the tax. Since 2025 the portal asks for B2B and B2C sales in separate tabs of that table, and you pick codes from a list rather than typing them. If your invoices carry the code, this table is a sum. If they do not, someone rebuilds it from descriptions at the end of the month. How the rest of GSTR-1 fills in is in GSTR-1 from your invoices.

Common mistakes

Two digits, or a chapter heading, where four or six are needed.
An HSN code on a service, or a SAC on goods.
One code for everything you sell, when the items are different.
A code typed with spaces or dots that does not match anything on the portal.
The right code but the old rate, after a rate change.

The code is one of several fields a tax invoice needs. The full list is in what a GST tax invoice needs.

In Openn InvoiceOn Items and services, set the HSN/SAC code and GST rate for each item once, and every invoice that uses the item carries them. On an invoice line the HSN/SAC field takes digits only, up to eight. The app uses the turnover you give in Settings for e-invoicing: above ₹5 crore it asks for 6 digits, and up to ₹5 crore it lets a B2C invoice go without a code. Before you issue, it warns you if a line that needs a code has none, has too few digits, or has a code that is not on GSTN's HSN/SAC list, the one the GSTR-1 dropdown uses. The Reports page has the HSN / SAC summary for GSTR-1 Table 12 in its B2B and B2C tabs, with the unit, quantity, rate and tax for each code, and a CSV download for each. The app does not choose codes for you: the code comes from you or your CA.

The short version

HSN codes are for goods, SAC codes for services. The code decides the GST rate.
Turnover up to ₹5 crore: 4 digits on B2B invoices, optional on B2C. Above ₹5 crore: 6 digits on all.
Find the code on the GST portal's HSN search, check it against the rate schedule, and ask your CA when in doubt.
Save it with each item so every invoice carries it.
GSTR-1 Table 12 sums your sales by code, now with B2B and B2C apart.