BooksIQNumber of HSN digits on a tax invoice depends on turnover: aggregate turnover UP TO ₹5 crore must quote 4-digit HSN for B2B supplies (optional for B2C); turnover ABOVE ₹5 crore must quote 6-digit HSN on ALL invoices. Services use SAC codes on the same basis.
Key points
- Under Rule 46 read with Notification 78/2020-CT, the number of digits of the HARMONISED SYSTEM OF NOMENCLATURE (HSN) code (or SAC for services) to be declared on a tax invoice is based on AGGREGATE TURNOVER in the preceding financial year: (a) turnover UP TO ₹5 CRORE — 4-DIGIT HSN mandatory for B2B (registered-to-registered) supplies;
- it is OPTIONAL for B2C supplies;
- (b) turnover MORE THAN ₹5 CRORE — 6-DIGIT HSN mandatory on ALL invoices (B2B and B2C).
- Certain chemicals and notified goods require 8 digits.
- HSN summary must also be reported in Table 12 of GSTR-1.
- Incorrect or missing HSN attracts a penalty under §125 (general penalty).
Reference: Rule 46 CGST Rules read with Notification 78/2020-CT
This page is general information for Indian businesses, current as of the
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