In Tally ERP 9, You can set GST rates & HSN /SAC Codes at various levels of operation in order to apply gst rates & HSN SAC codes to goods and services during voucher entry to get printed in Invoice and other reports.
Before we go; let’s understand some basics about HSN Code/SAC code
What is HSN Code ?
HSN is the abbreviation of harmonised system of nomenclature , It is a system of naming ( coding ) Products for quick identification during international trading. This system is developed by World Customs Organisation. This codes are already in use in India for Import & Export of goods and service.Now implementing HSN code with GST tax system in India.
GST Act makes it mandatory to print HSN/SAC Code in the Invoice to the following categories of business based on Turnover.
|Business with Turnover
| Below 1.5 crore
| 1.5 crore to 5 crore
||2 Digit HSN Code
| Above 5 crore
||4 Digit HSN Code
|Business deals with Import and export
||8 Digit HSN Code
|Business deals with service
||5 Digit SAC Code
The turnover of the previous year is considered for implementing HSN code with Invoice.
How can we find the HSN Code of the Products?
There are more than 5000 commodity groups under HSN Code system.It is very difficult to find out a particular product’s HSN code from the GST Portal. The HSN Code provided in the GST Rate booklet provided by GST council contains only Four digits. As per GST Act business may require 2 digit codes, 4 Digit HSN Codes and 8 Digit HSN Codes. Let’s understand this.
Example : Findout the 2 digit, 4 digit & 8 Digit HSN code of PLYWOOD
There are some other websites apart from gst official sites provide you HSN Code.
Lets use http://cybex.in which is found more user friendly for me. Access the website in your browser.
Go to Menu Indian Trade Laws > HS Classification
Here you will find 21 sections & 98 chapters of HSN Code.
Find out the appropriate section of your commodity. Section 9 is found suitable for PLYWOOD, If you found difficult in identifying right section, you can use the search provided at the top of the page.
In Section 09, You will Find Chapter 44 Which states “Harmonised System Codes of Chapter 44: Wood and Articles of wood; wood charcoal“.
As PLYWOOD is the articles of wood. Click on Chapter 44 . In this page you will find Section, Chapter & Heading codes.
Under Heading Code You will find HS CodeS of PLYWOOD ,VENEERED PANEL AND SIMILAR LAMINATED WOOD.
Now click on Heading code, You will get the more precise classification of plywood & veneer with 8 Digit HSN Code. Choose the right Product HSN Code.
So from this example of PLYWOOD The codes can be Identified as
2 Digit HSN Code of PLYWOOD is the Chapter code : 44
4 Digit HSN Code of PLYWOOD is the Chapter Code (44) + Heading Code (12) : 4412
6 Digit HSN Code of PLYWOOD is the Chapter Code (44) + Heading Code(12) + Product Code : (31) : 441231
8 Digit HSN Code of PLYWOOD is the Chapter Code (44) + Heading Code(12) + Product Code : (31) + Product Sub Division Code (10) = 44123110.
Hope this helps to findout the HSN Code of the products.
What is SAC Code & How to find out right SAC Code ?
SAC is the service accounting codes for accounting services in India.This coding system is developed by Central Board Of Excise and Customs ( CBEC) Which was in use with service tax regime. Now service tax is subsumed by GST but the code is retained and used in GST for accounting Services.
Download a List of Services Accounting Code With Heading Number, Group Number & Service tarrif code from below link.
DOWNLOAD SAC CODE FOR GST in PDF FORMAT
DOWNLOAD SAC CODE FOR GST in EXCEL FORMAT.
Open the sheet you will Find the code as explained below.
4 Digit SAC = Heading Code : 9954
5 Digit SAC = Heading Code (9954) + Group Code (1) : 99541
6 Digit SAC = Heading Code (9954) + Group Code (1) + Service Code (1) : 995411
How to find out GST rate for your product ?
Now we know how to find-out the HSN/SAC code, Now we want the tax rate of every products we are dealing with. You can get GST rates at various websites, Please find below the best options selected.
GST Rate Finder Provided By CBEC
GST rate and HSN Look up by cleartax.
GST rate ,HSN/SAC Finder at Indiafiling
Configure GST rate HSN/SAC
GST rates and HSN Codes can be configured at various levels of tally erp 9.
- Company Level
- Stock group level
- Stock Item Level
- Ledger Group Level
- Ledger Level
- Transaction level.
If you set GST rate & hsn/sac more than one level ,then tally will consider the rate and code in the following order
|GST RATE & HSN,SAC CONFIGURED AT
||TALLY WILL CONSIDER
|Company Level, Stock Group, stock item, ledger group, ledger level & transaction level
||Transaction Level rate & HSN/SAC
|Company Level, Stock Group, stock item, ledger group &ledger level
||Ledger level rate & HSN SAC
|Company Level, Stock Group, stock item & ledger group
||Ledger group level gst rate HSN & SAC
|Company Level, Stock Group& stock item levels
||Stock item level gst rate & HSN & SAC
|Company Level & Stock Group
||Stock group level rate & HSN SAC
||company level rate & hsn/sac
GST rate, HSN/SAC setup at Company level
We can configure gst rates &hsn/sac at company features screen or we can say company level. This rate setup is useful when all the goods and service have the same tax rate.
How to setup gst rate at company level ?
To setup GST rate ,HSN/SAC at company level. go to
F11 Features > F3: Statutory & Taxation
In the statutory & taxation screen enable the following options.
Enable Goods & service tax ( GST) : Yes
set/alter GST Details : Yes
GST Details screen will appear, In the screen enter state, GSTIN, Applicable date as shown in the image also enable.
set/alter GST rate details : Yes.
This will bring rate setup screen ,
Click on F12: Configure
Allow HSN/SAC details : Yes
Show All GST tax type : YesThis will Bring GST details with HSN /SAC details.
HSN/SAC : 4412
Taxability : Taxable
Integrated Tax : enter the integrated tax, Tally will automatically split state tax & central tax. see the image below.
Press enter to save all the screens.Company level gst rate setup is useful for users whose tax rate & HSN/SAC is same for all commodities.
Setup GST rate hsn/sac at stock group level
You can specify GST tax rate, HSN/SAC at stock group level also. This is helpful for those sellers who is having a group of items having same tax rate, HSN/SAC. If we set gst rate hsn/sac at this level all stock item under this group will be used the same rate during invoicing.
How to setup GST rates hsn/sac at stock Group Level ?
To set GST Rates & HSN/SAC at stock group level, Either you have to create or edit an existing stock group . Let’s create a stock group . Before we start make sure that you have activated GST in F11 Features, but do not set rate there.
Go to Gateway of Tally> Inventory Info> Stock Groups> Create
Set/alter GST Details : Yes
Press enter, you will get access to a new screen called gst details where tax rate is set.
Press enter key to save both the screens. Now we have set tax rate for stock group.The rate hsn/sac set at stock group will override the rate ,hsn/sac set at Company Level.
Setup GST Rates & HSN /SAC at stock item level
GST rate & hsn/sac at stock item level is useful when few items in a stock group or all of the products in a company have different GST rate and code. If few items in a stock group have different rate than the rate set at the stock group level, then you can specify GST rate and code for individual stock items which will override rate set at stock group level and company level used while invoicing.
How to set GST Rate at stock item level ?
To set the rate at individual stock item level you have to edit existing stock group. Let’s create a GST rate at stock item as mentioned in the above table.
Go to Gateway of Tally> Inventory Info>Stock item >Create
Enter the name, Under group ,Units and in the statutory information
GST Applicable ? : Applicable
Set/alter GST Details : Yes ( Refer below image)
Press enter to get the tax rate definition screen. Then enter Calculation type, and taxability as applicable to you. Enter integrated tax in the given field, refer below image.
Press enter to accept and save both the screens. Now you have set the gst rate, hsn/sac code details at stock item level which will override the rate at company level and stock group level.
Setup GST Rate at Ledger Group level
Specifying gst rate &hsn/sac at ledger group level will help you to apply same tax rate for different transactions type like, sales ,purchase, sales return & purchase return.
How to set GST Rate at ledger group level?
For example we can set the gst rate to a sales group called local sales under which all local sales ledger are placed.
Gateway of Tally>Accounts Info>Group> Create /Alter
Set/alter GST Details : Yes
Press enter to get gst tax rate details.
Enter Nature of transaction & tax type as shown below.
Press enter to accept and save both the screen.
The rate set at ledger group level will override the rate set at stock item level,stock group level & company level.Tally will consider the rate set at ledger group level even if you have set rate at other levels.
Setup GST rate at ledger level
You can set up GST rate & hsn/sac at ledger level if you want to segregate sales or purchase of item with same tax rate. We can define rate at Sales/Purchase ledgers.
How to set up tax rate at ledger level?
To setup tax rate & hsn at ledger level, you have to go to ledger creation/alteration screen.
Gateway of Tally> Accounts Info>Ledger >Create
Is GST applicable ? : Applicable
Set/alter GST Details : Yes .
Press enter KEY, GST details screen will appear. enter the tax rate as shown in the below screen.
Press enter and accept the screen. The rate & hsn /sac defined at Ledger level will override the rate set at ledger group, stock item level, stock group level & company level.
How to set GST rate at Transaction Level ?
Some times you may want to change the tax rate even after you have set GST rate at some levels of Tally ERP 9.
Example : We have set GST rate at company level and want to create an invoice for exempt sale.That is the tax rate should be NIL in invoice. To do this.
From sales Invoice Press F12 Configure button.
Save configuration screen.
Select The sales ledger ,Tax classification details will appear.
Select Sales Excempt,
Enter sales details, tax ledger cgst & sgst, You will find the tax amount is calculated as zero. This is because of calculation of gst at transaction level.
HSN/SAC Cannot set at transaction level
The best practice is that SET tax rate and HSN/SAC in the same level.