What Is an HSN Code? Digits, Rules and How to Find Yours (2026)

Every line on a GST invoice in India carries a short number that most shop owners copy from a supplier's bill without a second look: the HSN code. It looks like paperwork, but it is the number that decides which GST rate applies to the item, and in your GSTR-1 it is the number the tax department uses to check that you charged the right one.

This guide explains what an HSN code is and how its digits are built, how many digits your invoice needs under the current rules, how HSN differs from SAC, where to find the right code for your items, and what changed when GST rates were reset in September 2025. It ends with the mistakes that cause trouble at return time and how to avoid them.

Quick answer

HSN stands for Harmonised System of Nomenclature, an international system for classifying goods developed by the World Customs Organization. Under GST in India:

• Every good you sell has an HSN code; every service has a SAC code, which begins with 99.
• If your turnover in the previous year was up to ₹5 crore, print at least 4 digits of the code on B2B invoices (optional on B2C).
• Above ₹5 crore, print at least 6 digits on all invoices.
• The code also appears in Table 12 of GSTR-1, in e-way bills and in e-invoices.
• Find yours on your supplier's bill, through the HSN/SAC search on the GST portal, or with your CA.

What is an HSN code?

The Harmonized Commodity Description and Coding System, usually just "the Harmonized System" or HS, was introduced by the World Customs Organization (WCO) in 1988. More than 200 countries and economies use it to classify goods in customs tariffs and trade statistics, and it covers most of world trade. It sorts goods into a tree: 21 sections, broken into chapters, broken into headings and subheadings. Every product in international trade sits at exactly one point in that tree.

India adopted the system for customs long before GST. When GST arrived in 2017, it reused the same codes to classify goods, so the "HSN code" on your GST invoice is the same number used by customs for that item. India calls it the Harmonised System of Nomenclature, which is why the acronym is HSN rather than HS.

Two things make HSN useful under GST:

1. It ties each item to one rate. GST rate notifications list goods by HSN heading. Find the code, and you find the rate.
2. It lets the system cross-check you. Your GSTR-1 reports sales by HSN code, so the department can compare the rate you charged with the rate the code carries.

How an HSN code is built

An HSN code reads from left to right, from broad to specific. The first six digits are international and the same in every country that uses the Harmonized System. India adds two more for its own tariff.

Digits	Level	Example: basmati rice
2	Chapter	10: Cereals
4	Heading	1006: Rice
6	Subheading (international)	1006 30: Semi-milled or wholly milled rice
8	Tariff item (India)	1006 30 20: Basmati rice

Another example, for a garment shop:

Digits	Level	Example: cotton T-shirt
2	Chapter	61: Apparel, knitted or crocheted
4	Heading	6109: T-shirts, singlets and other vests
6	Subheading	6109 10: Of cotton
8	Tariff item	6109 10 00

The international system uses chapters 01 to 97. India's tariff adds chapter 98 for special items and uses chapter 99 for services, which is where SAC codes come from.

HSN vs SAC

Goods use HSN codes; services use SAC (Services Accounting Code). Both serve the same purpose, but they are built differently.

	HSN	SAC
Used for	Goods	Services
Origin	World Customs Organization (international)	Developed in India for service tax, carried into GST
Starts with	Any chapter from 01 to 97	Always 99
Typical length on invoices	4, 6 or 8 digits	6 digits
Example	3401: Soap	9963: Accommodation, food and beverage services

Common SAC groups you will meet:

• 9954: construction services
• 9963: accommodation, food and beverage services
• 9965: goods transport services
• 9983: other professional, technical and business services
• 9988: manufacturing services on inputs owned by others (job work)
• 9997: other services

A business that sells both, such as an electronics shop that also repairs, uses HSN codes on its product lines and SAC codes on its service lines, on the same invoice.

How many HSN digits must you use?

The rule comes from Notification No. 78/2020 – Central Tax, dated 15 October 2020 and in force since 1 April 2021. It ties the number of digits to your aggregate turnover in the previous financial year:

Previous-year turnover	B2B invoices	B2C invoices
Up to ₹5 crore	At least 4 digits	Optional
Above ₹5 crore	At least 6 digits	At least 6 digits

Three points people miss:

• These are minimums. Printing all 8 digits is always allowed, and it often removes doubt about which rate applies.
• The turnover test looks at the previous year. If you crossed ₹5 crore this year, the 6-digit rule applies from the next year.
• The same digit counts apply in GSTR-1 Table 12, the HSN-wise summary of your sales.

Where the HSN code shows up

On the invoice. Rule 46 of the CGST Rules lists the HSN code among the mandatory particulars of a tax invoice. Our guide to the GST invoice format shows where it goes on a sample bill.

In GSTR-1 (Table 12). Your monthly or quarterly return includes an HSN-wise summary: for each code, the quantity, taxable value and the IGST, CGST and SGST amounts. Since 2025, the GST portal has tightened this table. HSN codes are picked from a dropdown rather than typed freely, and B2B and B2C supplies are reported in separate tabs. A wrong or missing code now shows up as a validation problem, not just a note in an audit.

In e-way bills and e-invoices. Both carry HSN codes, so an error on the invoice travels into those documents too.

How to find the right HSN code for your products

Work through these in order:

1. Your supplier's invoice. If you resell goods, your supplier has already classified them. Their bill is the quickest starting point, though suppliers do make mistakes, so sanity-check unusual items.
2. The GST portal's HSN/SAC search. On the GST services website, search by product name or by code. It shows the description against each code, so you can confirm you are in the right heading.
3. The customs tariff and CBIC rate notifications. For a definitive answer, the Customs Tariff gives the full 8-digit structure, and CBIC's rate notifications give the GST rate against each heading.
4. Your chartered accountant. Use one for anything that could fall under two headings, such as a gift hamper, a product sold with a service, or a part that could count as either a component or an accessory. Classification disputes are where real tax money is at stake.

Once you have the code, record it against the item in your billing software, so it is chosen once and repeated correctly on every bill afterwards.

HSN headings for common shop items

A quick reference to the 4-digit headings that cover the goods most small shops sell. Use these as a starting point, then confirm the full code and rate for your exact product, because many headings split further by material, packing or use.

Shop type	Item	HSN heading
Kirana	Rice	1006
Kirana	Wheat flour (atta)	1101
Kirana	Sugar	1701
Kirana	Tea	0902
Kirana	Coffee	0901
Kirana	Biscuits, bread, cakes	1905
Kirana	Toilet soap	3401
Pharmacy	Packaged medicines	3004
Electronics	Mobile phones	8517
Electronics	Computers and laptops	8471
Electrical / hardware	Lamps, including LED lamps	8539
Hardware	Plastic pipes and tubes	3917
Packaging	Plastic boxes, bags and containers	3923
Stationery	Printed books	4901
Jewellery	Articles of jewellery	7113
Footwear	Footwear with leather uppers	6403

Two items under the same heading can carry different rates. Garments and footwear, for example, have historically been taxed at different rates depending on their sale value. The heading gets you to the right part of the tariff; the full code and the rate notification get you to the right rate.

What GSTR-1 asks for in the HSN summary

Table 12 of GSTR-1 is where HSN codes stop being a line on an invoice and become something the system checks. For each HSN code, it asks for:

• The HSN code (chosen from the portal's list) and its description
• The UQC, or unit quantity code, such as NOS for numbers, KGS for kilograms or MTR for metres
• The total quantity sold
• The total taxable value
• The IGST, CGST, SGST/UTGST and cess amounts

The totals in Table 12 should agree with the invoices reported elsewhere in the same return. If one item was billed under two different codes, or with a unit of "pieces" on some bills and "boxes" on others, this is where the mismatch shows. The fix is upstream: one code, one unit and one rate per item, saved once in your billing software.

HSN codes and the September 2025 GST rate changes

On 22 September 2025, GST moved to a simpler structure. Most goods are now at 5% or 18%, luxury and sin goods are at 40%, and essentials are at nil. The old 12% and 28% slabs were removed for most items. HSN codes did not change; the rates attached to many of them did.

Some everyday examples (always confirm the exact entry for your item):

HSN heading	Item	Before	From 22 Sep 2025
3401	Toilet soap	18%	5%
3306	Toothpaste	18%	5%
3305	Shampoo, hair oil	18%	5%
0405	Butter, ghee	12%	5%
0406	Cheese	12%	5%
1806	Chocolates	18%	5%
2106	Paratha and other Indian breads	18%	Nil
8712	Bicycles	12%	5%
2523	Cement	28%	18%
8415	Air conditioners	28%	18%
2202	Aerated drinks with added sugar	28%	40%

If your item list was set up before September 2025, review every item at 12% or 28%. An outdated rate on a correct HSN code is still a wrong bill, and Table 12 makes the mismatch easy to spot.

Common HSN mistakes, and what they cost

• No HSN code on a B2B invoice. It is a missing mandatory particular. Your buyer may question the bill, and it weakens your records in any later scrutiny.
• Too few digits. A 4-digit code is not enough if your turnover was above ₹5 crore.
• The wrong heading. This is the expensive one. A wrong code usually means a wrong rate, and short-paid tax has to be paid with interest.
• Different codes for the same item. If two branches or two staff classify the same product differently, your Table 12 contradicts itself.
• HSN codes on services. Services use SAC codes beginning with 99, not HSN.
• Copying codes without checking. Suppliers are not always right, especially for mixed or unusual products.

On penalties: apart from tax and interest on any short payment, contraventions that have no specific penalty fall under the general penalty in Section 125 of the CGST Act, up to ₹25,000 under the CGST Act and the same again under the state Act. A missing or wrong code is rarely worth risking that, or the questions that come with it.

If you import or export

Importers and exporters meet HSN codes twice: on the GST invoice, and on the shipping bill or bill of entry at customs. Because GST borrowed its classification from the customs tariff, the two should match. A product cleared at customs under one 8-digit code and sold under a different GST heading is the kind of inconsistency that draws questions from both departments.

Exporters have one more reason to use the full 8 digits. Export incentives, duty drawback rates and some foreign-trade policy conditions are tied to the exact tariff item, so a shortened code is not enough on export paperwork. If you trade across the border, keep one master list of your products with their 8-digit codes, and use it for customs and GST alike.

How BillZap handles HSN codes

BillZap, our free GST billing app for Android, treats the HSN code as part of the item, not part of the bill:

• You save the HSN or SAC code and GST rate once against each item in your catalogue.
• BillZap suggests the GST rate from the item name, which you confirm, so a new item starts from a sensible default.
• Every bill that includes the item prints its code automatically. The code never has to be typed at the counter, so it cannot be mistyped there.
• The monthly GST summary is laid out for GSTR-1, with taxable value and CGST, SGST and IGST, so your accountant has what they need for the return.

It works fully offline, needs no account, and has no paid tier. If you are comparing tools, our review of GST billing apps covers how each one handles HSN codes and returns.

FAQ: HSN codes

What is an HSN code in GST?

An HSN code is the number that classifies a product under the Harmonised System of Nomenclature, the international goods classification used for customs and adopted for GST in India. It identifies the product and the GST rate that applies to it, and it must appear on tax invoices and in GSTR-1.

Is HSN code mandatory on every invoice?

On B2B invoices, yes, with at least 4 digits if your previous-year turnover was up to ₹5 crore, and at least 6 digits above that. On B2C invoices it is optional below ₹5 crore and mandatory, with 6 digits, above it.

What is the difference between HSN and SAC codes?

HSN codes classify goods and come from the international Harmonized System. SAC codes classify services, were developed in India, and always begin with 99. A tax invoice uses HSN for goods lines and SAC for service lines.

How do I find the HSN code for my product?

Check your supplier's purchase invoice, search by product name in the HSN/SAC search on the GST portal, or refer to the customs tariff and CBIC rate notifications. For products that could fit more than one heading, confirm with your chartered accountant.

How many digits does an HSN code have?

The international Harmonized System goes to 6 digits. India's customs tariff extends it to 8 digits. Under GST you must print at least 4 or 6 digits depending on your turnover, and you may print all 8.

Did HSN codes change with the 2025 GST reform?

No. The codes stayed the same; the GST rates attached to many of them changed from 22 September 2025. Most goods are now at 5% or 18%, with 40% for luxury and sin goods. Review the rate saved against each item in your billing software.

The bottom line

An HSN code is the link between what you sell and what GST you charge. Get it right once, saved against each item with enough digits for your turnover, and it quietly does its job on every bill and in every return. Get it wrong, and the error repeats on every invoice until GSTR-1 brings it to light.

The simplest protection is to stop typing codes at the counter. If you want a free app that stores the code with each item and prints it on every bill, BillZap is on Google Play. It works offline with no sign-up.

This guide explains GST classification in plain language and is not tax advice. Classification and rates depend on the exact product; confirm with your chartered accountant before relying on a code for a filing.