HSN Number

HSN number stands for Harmonized System Nomenclature. It is multipurpose international product nomenclature developed by the World Customer Organization (WCO) with the objective of classifying goods from all over the world in a systematic and logical manner.

It comprises about 5,000 commodity groups each identified by a six digit code, arranged in a legal and logical structure and is supported by well-defined rules to achieve uniform classification.

HSN code number is widely used in many countries to classify goods for taxation purpose, claiming benefits etc. Harmonized System of Nomenclature number for each commodity is accepted by most of the countries and the said HSN number remains same for almost all goods. However, HSN number used in some of the countries varies little, based on the nature of goods classified.

HSN Number Under GST

When implementing GST, all goods are classified based on HSN number for GST purpose. HSN number is mainly used for classifying goods to compute Value Added Tax in India. The same classification code (HSN) is adopted for classifying Goods and Service Tax, GST. From 1986 HSN system has already been using in the Central Excise and Customs Regime. It is a much more detailed classification that added another two digits to the 6-digit structure.

GST shall be required to follow a 3-tiered structure of HSN.

• Those with a turnover of less than INR 1.5 Crores need not follow HSN.
• Those with a turnover exceeding INR 1.5 Crores but less than INR 5 Crores shall be using the 2 digit HSN codes.
• Those with a turnover exceeding INR 5 Crores shall be using the 4 digit HSN codes.
• Those dealers who are into imports or exports shall mandatorily follow the 8 digit HSN codes.