Service Accounting Code, also known as SAC, is the code issued by the Central Board of Indirect Tax & Customs (Service Tax Department) to classify and identify the services offered. Each Service provided has a unique SAC code precisely like a unique HSN for different categories of products.
People involved in providing services can and should use the SAC code to understand the tax imposed on the services offered and received clearly.
SAC (Services and Accounting Code) codes are based on the Harmonized System of Nomenclature, an internationally recognized system for classifying and codifying all the products in the world. This system enables the compliance of GST based on international standards.
- The HSN/SAC codes will help businesses identify the correct GST applicable rates to the specific goods and services.
- For registration, it is mandatory to insert these details.
- Among the vast number of goods and services available, these codes help identify specific goods and services.
The main difference between HSN and SAC codes is that HSN codes are meant only specifically for goods and services, and SAC codes specify for services only. Other, difference is in the number of digits in their code and their relevance. Example – HSN Code is an 8-digit code, and SAC code is a 6-digit code.