HSN Code Finder

What Is HSN Code?

The full form of HSN stands for “Harmonized System of Nomenclature”. HS Code which is known as HSN Code in India was developed by World Customs Organization (WCO) as a standardised system that classifies goods all over the world in a systematic manner. In India, HSN Code has 4, 6 & 8-digit uniform codes that classify more than 5000 products and are accepted worldwide.

Why is the HSN code important?

Being an internationally recognized standard, the first 6 digits of the HSN Code are the same for all the countries. But for further classification countries have added more digits to their respective HS Code systems. For example, In India, we have an 4, 6 & 8 digit classification whereas the US uses HTS Codes known as Harmonised Tariff Schedule, which has a 10 digit classification.

Why is the HSN code used/required?

Since HSN Code is an internationally accepted standard for classifying products, that makes it a logical way of identifying goods for both domestic and foreign trade. It can be used to gather data and understand foreign and domestic trade happening internally as well as outside the country in a much more efficient manner. This will further help the government in deciding macroeconomic policies related to the trade of these commodities.

Who provides HSN Code?

Any changes or formulation or addition of new codes in HSN Codes are carried out by DGFT (Directorate General of Foreign Trade). Changes in product descriptions, removing defunct codes, the addition of new codes etc., are done periodically as a part of the ongoing process towards perfecting HSN Codes.

How To Find HSN Code Using HSN Code Finder?

How does the search for HSN Code work?
Search By Product Name: Type the name of your product, you will get recommendations of the most relevant 4 digit HSN Codes. Hit search for all results if the recommendations do not contain the right HS code. Click on the 4 digit code to get 6 and 8 digit HS code details for export-import purposes, as well as the GST Rates.
Search by HSN Code: Type the first 2 or first 4 digits of the HSN Code. Click on the desired result to get more information about the HSN code.
How to use HSN code using Category List? We have categorised the list of HSN Codes into 23 broad sections under All Categories. Navigate from this menu to the 2 digit, 4 digit, 6 & 8 digit HSN Codes respectively. Find GST rates of HSN Codes by clicking on 4 digit code.

Is HSN Code Mandatory?

In exports, the ITC-HS Codes are mandatory. It is compulsory to mention the 8 digit HSN Code on the shipping bill, failing which the export benefits shall not accrue. In GST however, HSN Codes are not mandatory for businesses with a turnover of less than Rs 1.5 cr or if the dealer is registered under the Composition Scheme of GST.

Understanding the Structure & Bifurcation Of HSN Code

The Structure of HSN Code

• There are 21 sections in HSN Codes
• Divided in 99 Chapters wherein each chapter defines a specific category of a product

The Bifurcation of HSN Code The chapters are further divided into headings, sub-headings and tariff items. In the 8 digit structure of an HSN Code, the first 2 digits define the Chapter, at 4 digit level are the headings, at 6 digit are the subheadings and finally at 8 digit are the tariff items.

HSN Code and GST

HSN Codes were earlier applicable only for Central Excise and Customs, but with the implementation of GST now there is a requirement for businesses to mention HSN Codes in their tax invoice and also report them in their GST returns. Further, CBIC has reported GST rates on the basis of HSN classification of goods. Hence, in order to determine the GST Rate of your product, again its required that the business must first identify the correct HSN Code. Earlier the provisions related to HSN Code under GST issued by the Central Board of Indirect Taxes (“CBIC”) were as follows:-

• Annual Turnover less than and up to Rs 1.5 cr – Not required to mention HSN Codes
• Annual Turnover more than 1.5 cr up to 5 cr – Required to mention HSN Code up to 2 digits
• Annual Turnover exceeding 5 cr – Required to mention HSN Code up to 4 digits

The above notification was remodeled to mandate 4/6- digit HSN Codes on supply of goods on the tax invoices making it applicable from April 1, 2021

• Aggregate turnover in the preceding year upto 5 cr - Required to mention HSN Code upto 4 digits
• Aggregate turnover in the preceding year more than 5 cr - Required to mention HSN Code upto 6 digits

One should also note the following points in addition to this:-

• For B to C businesses with turnover upto 5 cr, the requirement to report 4 digit HSN Codes is not compulsory while it is mandatory for B2B businesses
• Any business engaged in import-export transations which are goverened by Foreign Trade Policy & customs regulations, it is mandatory to mention 8 digit HSN Codes or HS Codes as notified by DGFT on all invoices and customs paperwork.

Example of HSN Code

In India, almost all goods are classified under the HSN system. On the basis of their turnover and nature of transactions, a business has to determine the 4, 6 or 8 digit code for their product. Taking this into consideration, here's an example with 3 different scenarios:-
Scenario 1 Mr. A, a domestic trader supplying cement needs to identify HSN Code for raising his Tax Invoices. His annual aggregate turnover is INR 4.5 cr. Since Mr. A's turnover is below 5 cr, he will need the 4 digit HSN Code for his product. After doing his research he determines that the HSN Code 2521 - Cement, including cement clinkers, whether or not coloured, is the most appropriate HSN Code for his product and accordingly mentions it in his invoices and GST returns.
Scenario 2 If Mr. A's turnover were to exceed 5 cr, he will have to report 6 digit HSN Code. In that case, he would further identify the correct 6 digit HSN Code according to the specifications of his product. Let's say his cement is aluminous cement, he will determine HSN Code 252330 as the most accurate.
Scenario 3 Mr A also exports his cement to the USA. For filing his customs paperwork and also to raise his invoices he needs to report the correct HSN Code. Since the nature of this transaction is now export of goods, it becomes mandatory for Mr. A to report 8 digit code for his product. he determines that the corresponding 8 digit code for aluminous cement is HSN Code 25233000, accordingly, he prepares his export documents.

What Is The Meaning Of 8 Digit HSN Code Or What Is The Structure Of HSN Code?

There are 21 sections in HSN Codes, divided into 99 Chapters wherein each chapter defines a specific category of a product. The chapters are further divided into headings, sub-headings and tariff items. In the 8 digit structure of an HSN Code, the first 2 digits define the Chapter, at 4 digit level are the headings, at 6 digit are the subheadings and finally at 8 digit are the tariff items. All 8 digits HSN codes are mandatory in the case of export and imports under GST. (HSN codes to be declared from 1st April 2021)

Difference between HSN Code and SAC Code

Harmonized System of Nomenclature code (HSN Code) is used for classifying goods under GST. The codes have been issued by World’s Customs Organization (WCO). They are used for the classification of commodities under various sections, chapters, headings, and sub-headings that belong to alike nature. Services Accounting Code (SAC Code) is used for Classifying services under GST. The codes have been issued by the Central Board of Excise and Customs (CBEC). They are used for the classification of all the services as each service has been assigned a unique SAC. In both scenarios, it makes the GST return filing process much systematic & simpler.

What Is The Difference Between ITC-HS Code And HSN Code?

ITC stands for Indian Trade Classification or Indian Tariff Code. ITC-HS was adopted in India for Import-Export operations. ITC HS Codes are divided into two parts or schedules, the first schedule has the 8 digit nomenclature and the second schedule includes the description of goods. The main difference between ITC-HS Code and HSN Code is that ITC has added further 2 digits in the 6 digit HSN structure to classify “Tariff Items”. This addition has been done within the regulations of the HS system setup by WCO without any changes in the existing structure.

What If The HSN Code You Have Used Is Wrong?

As an exporter, if you have used incorrect HS Code then it can lead to problems with your shipment during customs inspection. There can be issues like denial of import privileges, heavy custom duty charges, non-compliance penalties etc. In GST, if you have used an incorrect HSN Code then the buyer will not be able to MrMrclaim his input tax credit. As per Section 31, an invoice is supposed to be complete in all aspects including correct HSN classification for claiming the input tax credit.