SAC Code for Legal, Secretarial & Professional Consultancy Services in India

Navigating GST compliance can be challenging, but one of the most crucial yet overlooked details is correctly classifying your services. Are you using the right SAC code legal services for your invoices and returns? Getting this classification correct is a fundamental step towards seamless GST compliance. A Services Accounting Code (SAC) is a standardized system used under the GST regime in India to classify services for accurate taxation and record-keeping. For professionals in the legal, secretarial, and consulting fields, understanding SAC code for consultants is non-negotiable. Using the correct SAC code ensures you charge the right amount of GST, file accurate returns, and avoid potential penalties from tax authorities, making it an indispensable part of your business operations.

What is a SAC Code and Why is it Critical for Your Business?

Before diving into the specific codes for your profession, it’s essential to understand the basics of the SAC system and its profound impact on your financial compliance. It’s more than just a number on an invoice; it’s the foundation of your GST reporting structure.

A Simple Breakdown of the Services Accounting Code (SAC)

The Services Accounting Code (SAC) is a unique 6-digit number that classifies every service under the GST framework. This system is a part of the globally recognized Harmonized System of Nomenclature (HSN) framework, which has been adapted for services in India. The structure is logical and hierarchical, designed for easy identification:

The first two digits (99) are common for all services.
The next two digits represent the major nature of the service (the Heading). For example, 82 in 9982 represents “Legal and Accounting Services.”
The last two digits specify the detailed nature of the service (the Service). For instance, in the SAC 998213, the final 13 pinpoints “Legal documentation and certification services.”

This standardized system ensures uniformity in how services are identified and taxed across the country, simplifying the entire indirect tax process for both businesses and the government.

The Real Impact: Why the Correct SAC Code Matters

The SAC code importance for legal services and other professional fields cannot be overstated. Using the wrong code can trigger a domino effect of compliance issues. Here’s why getting it right is so critical:

Accurate GST Rates: The SAC code is directly linked to the applicable GST rate for a service. Most professional services fall under the 18% slab, but using an incorrect code could lead you to charge a wrong tax rate, resulting in either overpayment or underpayment of taxes.
Invoice Compliance: Under GST law, it is mandatory for registered taxpayers to mention the correct SAC code on their tax invoices. Failure to do so can render an invoice invalid, which can cause payment delays from clients and create problems during audits.
Seamless Input Tax Credit (ITC): Your clients rely on your correctly issued invoices to claim Input Tax Credit. An invoice with an incorrect or missing SAC code can lead to the rejection of their ITC claim, potentially damaging your business relationships.
Avoiding Penalties: Misclassification of services is a red flag for tax authorities. During scrutiny or audits, incorrect SAC codes can lead to queries, notices, and significant penalties for non-compliance. Ensuring accuracy from the start protects your business from unnecessary legal and financial trouble.

Finding the Correct SAC Code for Legal, Secretarial & Professional Services

Identifying the precise SAC code for your service is the next crucial step. Fortunately, the GST framework has categorized these services under specific headings, primarily Chapter 9982 (Legal and Accounting Services) and Chapter 9983 (Other Professional, Technical and Business Services). Below is a detailed breakdown to help you find the perfect match for your offerings.

The Definitive SAC Code for Legal Services India (Heading 9982)

For law firms, individual advocates, and legal consultants, nearly all services fall under the major Heading 9982. It’s vital to choose the sub-category that most accurately describes the service you are providing to ensure flawless compliance. Using the right SAC code for legal services is a cornerstone of your practice’s financial health. Here are the most common codes for the legal profession:

SAC 998211: Legal advisory and representation services concerning criminal law. This code is specifically for services related to defending or representing clients in criminal proceedings.
SAC 998212: Legal advisory and representation services concerning other fields of law. This is a broad and widely used category covering corporate law, civil litigation, tax law, family law, intellectual property, and general legal advice. This is the go-to SAC code for legal consultancy.
SAC 998213: Legal documentation and certification services. Use this code for services like drafting agreements, deeds, and contracts, as well as for notarization and certification of documents.
SAC 998214: Arbitration and conciliation services. This code is for alternative dispute resolution services provided to clients outside of traditional court proceedings.

Decoding the SAC Code for Secretarial Services India

The work of a Company Secretary (CS) often intersects with legal, accounting, and management functions. Therefore, the applicable SAC code depends on the specific nature of the service rendered. Selecting the correct SAC code secretarial services India requires a careful evaluation of the task performed.

SAC 998213: When a Company Secretary provides services related to legal documentation, statutory certifications under the Companies Act, or drafting of legal documents, this code is the most appropriate choice.
SAC 997154: This code is for “secretarial services on a fee or contract basis.” It can be used for routine secretarial activities and compliance management provided as a package.
SAC 998311 / 998319: If the service provided is primarily related to financial auditing, accounting work, or other similar business support functions, these codes under the “Other Professional Services” heading may be more suitable.

Navigating the SAC Code for Professional Consultancy Services India

“Professional consultancy” is an umbrella term that covers a vast range of services, from management advice to technical expertise. These services are primarily classified under Heading 9983. If you are a consultant, you need to find the specific code that aligns with your area of specialization. Here are the key codes for SAC code professional services India:

SAC 998313: Management consulting services. This includes strategic planning, organizational design, and operational improvement advisory services.
SAC 998314: Business consulting services. This is a broad category for general business advice, marketing strategies, human resource consulting, and other similar services.
SAC 998315: Financial management consulting services. Use this for advisory on corporate finance, investment strategies, and financial planning, excluding accounting and auditing.
SAC 99834: Technical consulting services. This is for consultants in engineering, science, and other technical fields providing specialized expert advice.
SAC 99839: Other professional, technical and business services n.e.c. (not elsewhere classified). This is a residual category for unique or niche consulting services that do not fit into any of the specific codes mentioned above. The SAC code for professional consultancy India often falls into one of these specific categories.

How to Use SAC Codes in Your GST Invoicing and Filing

Knowing your SAC code is only half the battle; correctly implementing it in your day-to-day compliance activities is what truly matters. From invoicing to filing your returns, the SAC code plays a central role.

Mentioning SAC Codes on Your GST Invoices

It is mandatory to include the SAC code on any tax invoice you issue to a client. The code should be clearly mentioned in the column describing the service provided. This not only ensures your invoice is compliant but also provides clarity to your client for their own accounting and ITC claims.

Here is a simplified example of how it should look on an invoice:

Description of Service	SAC Code	Taxable Value	GST Rate	CGST	SGST/IGST	Total
Legal Consultancy	998212	₹10,000	18%	₹900	₹900	₹11,800

Reporting SAC Codes in Your GSTR-1 Return

When you file your monthly or quarterly GSTR-1 return, you are required to provide a summary of the services you have supplied. This summary must be categorized by SAC codes. This information is reported in Table 12 of the GSTR-1 form. The level of detail required depends on your annual turnover:

Turnover above ₹5 crores: Mandatory to report 6-digit SAC codes.
Turnover up to ₹5 crores: Mandatory to report 4-digit SAC codes for B2B supplies. While optional for B2C supplies, it is a best practice to report them for accuracy.

Where to Verify Your SAC Code

While this guide provides the most common codes, it’s always wise to verify them, as regulations can be updated. The most reliable source for this information is the official government portal. You can easily check any SAC code on the CBIC GST portal.

For official verification, please visit the CBIC GST Portal’s HSN/SAC Search Tool and navigate to the services section.

Conclusion

Mastering the classification of your services through the correct SAC code is a fundamental step toward robust and stress-free GST compliance. For professionals, the primary codes fall under Heading 9982 for legal services and Heading 9983 for a wide range of other professional and consultancy services. By ensuring every invoice and GST return features the correct code, you not only comply with the law but also build trust with your clients and protect your business from potential penalties. Getting the SAC code legal services right from the outset is not just about rules; it’s about running a professional and transparent practice.

Struggling with GST compliance or unsure about the right SAC code for your services? The experts at TaxRobo are here to help. From accurate invoicing to timely GST filing, we’ve got you covered. Contact us today for a consultation!

Frequently Asked Questions (FAQs)

Q1: Is GST applicable to all legal services in India?

A: While most legal services are subject to GST, services provided by an individual advocate or a firm of advocates to a business entity with a turnover exceeding the registration threshold are subject to tax under the Reverse Charge Mechanism (RCM). This means the recipient of the service pays the GST directly to the government, not the service provider.

Q2: What is the GST rate for most professional and legal consultancy services?

A: The standard GST rate for the majority of services falling under SAC codes 9982 and 9983 (legal, professional, secretarial, consultancy) is 18%. However, it’s always best to verify the latest rate on the official GST portal, as rates can be subject to change.

Q3: What happens if I use the wrong SAC code for my consultancy services?

A: Using an incorrect SAC code can lead to several issues, including charging the wrong GST rate, rejection of invoices by clients (impacting payments), problems for your client in claiming Input Tax Credit, and potential notices or penalties from the GST department during an audit.

Q4: Do I need to mention the SAC code on my invoice if my annual turnover is less than ₹5 crores?

A: Yes. It is mandatory for all taxpayers to mention HSN/SAC codes on their B2B (Business to Business) invoices. For B2C (Business to Customer) invoices, it is optional for businesses with an aggregate annual turnover up to ₹5 crores. However, it is a best practice to always include the SAC code on all invoices for clarity and complete compliance.