What Is HSN Code
5paisa Research Team
Last Updated: 22 May, 2025 03:43 PM IST

Content
- What is HSN Code?
- Why is HSN Code Important in India?
- How Does HSN Code Work in India?
- HSN Code Applicability Under GST
- How to Find the HSN Code for Your Product?
- HSN Code vs SAC Code
- Examples of HSN Codes in Different Industries
- Mistakes to Avoid While Using HSN Code
- How HSN Codes Benefit Businesses?
- Conclusion
The HSN (Harmonized System of Nomenclature) code is a globally accepted classification system used for the systematic identification of goods. It is essential for businesses in India, especially those registered under GST (Goods and Services Tax), as it helps in standardizing taxation and trade across different countries.
If you are a business owner, trader, or manufacturer in India, understanding HSN codes can help you avoid tax complications, ensure smooth compliance, and streamline your invoicing process. This guide will explain what the HSN code is, how it works in India, how to find your HSN code, and why it is important for businesses under GST.
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Frequently Asked Questions
HSN (Harmonized System of Nomenclature) is a globally recognized classification system for goods, ensuring accurate GST rates and smooth trade.
You can check the GST portal, trade directories, industry handbooks, or consult a tax professional for the correct HSN code
Yes, HSN codes are required, but small businesses with turnover below ₹5 crore are exempt from using them in B2C transactions.
Incorrect HSN codes can lead to GST mismatches, penalties, and issues with input tax credit claims.
HSN codes should be included on GST invoices, E-way bills, and GST returns (GSTR-1, GSTR-3B, etc.) for compliance.