Explore the HSN code list in India with complete confidence by gaining detailed knowledge about all the available sections and their services at the GST rate.
HSN Code Full Form
HSN code stands for Harmonized System Nomenclature which has the main vision to facilitate the classification of Goods systematically all over the world.
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What is HSN Code
HSN Code is a six-digit code that classifies over 5 thousand products worldwide accepted it. The World Customs Organization has developed HSN as a multipurpose international product nomenclature which firstly came into effect in 1988.
In view of transportation of goods, the code has played an important role by determining their quantity and rate. These are defined values that the industry and Government use for Tax and other official purposes. This code describes giving detailed information about Goods. It is applied and make the values similar all over the nations including the import and export facilities.
|Help Desk Number
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HSN is a six-digit code that classifies thousands of products and is arranged in a Legal and logical structure. This code uses for taxation purposes. It easily helps to define the rate of tax applicable to each product. This differentiates the product taxation in every country which is under review.
HSN helps in a calculation to easily find the taxation benefits and as well as it is applied on all goods that transport. The code considers the entire quantity of import or export items from a nation. Having this algorithm in the picture does help to look at the products in an easy manner by having their quantity and rate described.
HSN Code Importance
The Code used and accepted worldwide by over 200 countries with an impressive rate of adoption. Here are some benefits that the code provides.
- International Trade Statistics collection
- Rational Basic for customs tariffs
- Give uniform classification of Goods
- 98% percent of trade is classified in terms of HSN
- Give an international classification to which it is attached
- The code remains same all over the world for Goods
HSN Code Understanding
It might be difficult to just tell the description of HSN Code in one go, so we have got some detailed information based on which it might be clear about the code value. Code contains over 21 sections, 99 chapters, 1244 heading and over 5224 subheadings.
- The structure defines as having 21 groups and classifies into 99 chapters. Each chapter divides into headings which have 1244 in number. These headings are further classified and divided into 5244 subheadings. The combination of this entire section makes an HSN Code.
- The first two digits of an HSN are from each chapter and the next two digits are sub-classified into another four-digit HSN. The last 4 digits into the HSN are further classified into other 6-digit HSN.
- In easy words, the first two goats are chapters and the next two digits are heading and the last four digits of an HSN Code are subheadings.
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GST and HSN Code
- The combination of Code with the Global Service Tax has an important role to bring a normalisation in the form of taxation. These codes have a major implication for GST, as it makes the GST systematic and as well make it acceptable globally.
- If a goods has got the Code, then it won’t require to describe the Goods details by any form as the code speaks everything. This brings easy GST value and describes the exact money for tax authority.
HSN Code in India
India is a developing country and it has been a member of World customs Organization since 1971. The country has used the 6-digit HSN Code to apply on the central excise duties and for customs merchandise. To make the HSN clearer for India, the country has added two more digits in code. It make the HSN for India with 8 digits.
- Majority of Goods in India are classified with HSN.
- It makes the GST implication much easier for the customs official. Every GST invoice prepared. It’s very important to print the HSN Classification of that Goods to bring a clear picture.
- The Government gives tax relief to the small taxpayer in India, through which they are not required to mention HSN code.
- Taxpayer with an turnover of 1.5 crore to 5 crores must mention the HSN with only two digit on invoice
- Any taxpayer with a turnover of 5 crore and above must have the given digit code printed on their invoice as mandatory.
Some of the Sections available and their services in GST Rates
|Distributive Trade Services; Accommodation, Food and Beverage Service; Transport Services; Gas and Electricity Distribution Services
|Financial and related services, real estate services; and rental and leasing services.
|Community, Social and Personal Services and other miscellaneous services
|Business and Production Services
What is HSN Code in a Bill Invoice?
Every product is given an unique harmonised system of nomenclature which defines its details and helps in defining the systematic classification of Goods across Globe. HSN Code apply on GST and Custom which is printed on Invoice for reference.
Is the HSN Code mandatory for every Goods?
As the new GST law, the GST taxpayers are asked to add the HSN Code for their Goods in the invoices. The 6-digit code will classify the details of Goods and thus help the customs to apply taxation without any difficulties.
How can I get HSN Code?
If you’re a small business holder, getting the HSN Code for your Goods will be mandatory. To get an HSN Code you need to go to Account information and then move to Groups and click on create the Sales Group. Here you need to set up the HSN Code and then alter the GST details to create the code. Code will be created as applicable form this page for your respective Goods.
Where does HSN Code print on Invoice?
If your business is holding up the turnover of Rs 5 crores then it is a must to print the HSN Code on your invoice. It is only required to print the 4-digit HSN Code on the invoice as per Indian standards. The custom official or the GST official does verify the code printed on the Invoice to calculate the Tax and thus help them to determine the value without fully going into the description of the Goods.
Explain HSN Code for Job Work?
Job work is an essential service activity that manufacturers rely on to produce their goods efficiently. It involves using inputs that are owned by the supplier, and the Service Accounting code plays a crucial role in this process by serving as the HSN code for job work. It’s worth noting that the code differs depending on whether the job work is carried out by the manufacturer or for the goods being supplied.