SAC Code

The Services Accounting Code (SAC) is a uniform six-digit classification the GST system uses to identify a service, fix the rate applicable to it, and standardise how it is described on invoices and in returns. Every SAC begins with "99" to mark it as a service; the next two digits denote the broad service group and the last two the specific service. SAC is the services counterpart of the HSN code used for goods, and both are derived from the United Nations Central Product Classification.

Structure

• First two digits (99): constant prefix identifying the entry as a service.
• Middle two digits: the major service category (for example 54 for construction, 71 for financial services).
• Last two digits: the exact nature of the service supplied.

Legal basis

SAC-wise service descriptions and their GST rates are set out in the annexure to Notification No. 11/2017-Central Tax (Rate) issued by the CBIC. Rates are applied through the standard GST 2.0 slabs of 0, 5, 18 and 40 percent, depending on the service.

Reporting requirement

Under Notification No. 78/2020-Central Tax, the number of SAC digits a taxpayer must quote on invoices and in Table 12 of GSTR-1 depends on aggregate turnover in the preceding financial year.

Aggregate turnover (previous FY)	SAC digits required
Up to Rs 5 crore	4 digits (mandatory on B2B invoices; optional for B2C)
Above Rs 5 crore	6 digits on all invoices

Quoting the correct SAC ensures the right rate is charged and helps the recipient claim accurate input tax credit; a wrong or missing code can trigger mismatches and scrutiny.