This article will guide you to know about how does the courier companies charge the gst for the services they render and what are the exemptions available to them. These services are very much routine in day to day business, so we do not look at it whether they have charged any gst and at what rate it is calculated. You will find all the details of GST applicability on Courier Services same here.
GST rate for all services supplied in India is dependent on the GST Council. GST Council consists of members in the Central and State Government to regulate and implement all aspects of GST in India. GST rate for providers is tied to SAC code, whilst GST rate for merchandise is tied to the HSN code. SAC code is a services classification system developed by the Service Tax Department at India. HSN code employed for classifying goods is an internationally accepted system for classifying goods in the course of international trade. In this guide, we look at the SAC code and GST rate for courier services and goods transport services in India.
Definition of Courier Agency:
Courier agency means any agency which is engaged in door to door transportation of documents, articles, goods utilizing the services of a person may be either directly or indirectly to transport or carry or accompany with such documents, articles or goods. Section 65(33) gives the definition of the courier agency.
The analysis of the definition says that the courier services would definitely include only those services where there is door to door service and not drop out facility. It should be hand to hand delivery. It should contain any of the things – documents, articles, or goods. The definition of documents, articles, and goods is not given anywhere, but it would definitely not include money which is to be given from one person to other.
SAC Codes List for Courier Services
The SAC Code for courier services and postal service are as follows:
SAC Code 996811 – Postal services, including post office counter services, mailbox rental services.
SAC Code 996812 – Courier services
SAC Code 996813 – Local delivery services
SAC Code 996819 – Other Delivery Services
GST Rates for Courier Services
Courier services are classified under SAC Code 996812 will be taxable at a GST rate of 18%. Except for the above types of courier services, some services provided by a Courier business can also fall under Goods Transport. We Examine the SAC Code and GST rate for Goods Transport below.
SAC Codes for Packaging Service
The SAC code for packaging services are as follows:
SAC Code 998540 – Packaging services of goods for others
SAC Code 998541 – Parcel packing and gift wrapping
SAC Code 998542 – Coin and currency packing services
SAC Code 998549 – Other packaging services n.e.c
18% of GST is applicable to packaging services.
Goods Transport by Land
SAC Code 996511 – Road transport services of Goods including letters, parcels, live animals, household & office furniture, containers etc. by refrigerator vehicles, trucks, trailers, man or animal-drawn vehicles or any other vehicles.
SAC Code 996512 – Railway transport services of Goods including letters, parcels, live animals, household & office furniture, intermodal containers, bulk cargo etc
SAC Code 996513 – Transport services of petroleum & natural gas, water, sewerage and other goods via pipeline
SAC Code 996519 – Other land transport services for goods
Goods Transport by Water Transport
SAC Code 996521 – Coastal and transoceanic (overseas) water transport services of goods by refrigerator vessels, tankers, bulk cargo vessels, container ships etc
SAC Code 996522 – Inland water transport services of goods by refrigerator vessels, tankers and other vessels.
Goods Transport Service by Air Transport
SAC Code 996531 – Air transport services of letters & parcels and other goods
SAC Code 996532 – Space transport services of freight