HSN Code for Hotel Room Rent: Essential Guide: 1 Minute to Understand Your Hotel Room Rent HSN Code

Understanding the HSN (Harmonized System of Nomenclature) code for hotel room rent is crucial, especially for businesses operating under India’s Goods and Services Tax (GST). The HSN system is used to classify goods and services, ensuring clear tax rates and streamlined invoicing processes. For hotel room rent, the HSN code falls under the services section rather than goods, and is more specifically classified through the SAC (Services Accounting Code). The relevant SAC code for renting hotel rooms or accommodation services is 9963, which covers accommodation services provided by hotels, inns, guest houses, clubs, and campsites. This code is used in all GST-related documents for the purpose of charging and collecting tax on accommodation services. Room tariff and GST liability: - Rooms with a tariff below ₹1000/day: No GST applicable - ₹1000–₹2500/day: 12% GST - ₹2501–₹7500/day: 18% GST - Above ₹7500/day: 28% GST From a design perspective, accurate classification and use of codes like SAC 9963 don’t just help with tax compliance; they also assist in segmenting service offerings. For example, hotels and resorts can use this categorization to tailor accommodation packages, streamline payment processes, and enhance the guest experience by clearly communicating the service breakdown. Speaking of breaking down the guest experience, when we design accommodation layouts for hospitality projects, digital planning tools like a room planner become vital in maximizing space utility, guest comfort, and operational efficiency.

Tips 1:

Always make sure your invoices clearly mention the SAC code (9963) for room rent, as this ensures transparency in taxation and smoothens compliance during audits.

FAQ

Q: What is the HSN/SAC code for hotel room rent?

A: The SAC code for hotel room rent under GST is 9963, used for accommodation services. Q: Is GST applicable on all hotel room rentals?

A: No, GST applies only to rooms with tariffs above ₹1000 per day, with slab rates increasing at higher tariffs. Q: Should hotels mention the SAC code on invoices?

A: Yes, mentioning SAC 9963 on invoices is mandatory for GST compliance. Q: Does the HSN code change for homestays or guest houses?

A: No, homestays and guest houses providing accommodation use the same SAC code, 9963. Q: Can a hotel use digital tools to plan their rooms and operations?

A: Yes, digital tools like room planners help hotels optimize layouts, maximize guest satisfaction, and ensure smooth back-end operations.