Home Goods & Service Tax Know all about HSN Code bifurcation

Know all about HSN Code bifurcation

3 min read
0
0
174
hsn code

HSN CODE

 Abbreviations We Need To Know

HSN Code Complete Bifurcation

The Harmonized Commodity Description and Coding System generally referred to as “Harmonized System of Nomenclature” or simply “HSN” is a multipurpose international product nomenclature developed by the World Customs Organization (WCO). 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. The system is used by more than 200 countries and economies as a basis for their Customs tariffs and for the collection of international trade statistics. Over 98 % of the merchandise in international trade is classified in terms of the HS. The HS contributes to the harmonization of Customs and trade procedures, and the non-documentary trade data interchange in connection with such procedures, thus reducing the costs related to
international trade.

HSN Code Full Form Harmonized System of Nomenclature

HSN in Indian context

In the Indian Context, a taxpayer having a turnover exceeding INR 5 crore is required to follow the HSN code of 4 digits. In the return form, rate of tax shall be auto populated based on the HSN codes used in furnishing invoice level purchase or sale information. After completing first year under GST, the turnover for previous year will be considered as baseline for using HSN codes of 4 digits. The use of HSN codes will make GST systematic and globally accepted. For taxpayers with turnover between INR 1.5 Crores and INR 5 Crores in the preceding financial year, HSN codes may be specified only at 2 digit chapter level as an optional exercise to start with. From the second year of GST operations, mentioning 2 digit chapter level HSN Code will be mandatory for all taxpayers whose turnover in previous financial year between INR 1.5 Crores and INR 5.0 Crores. Indian authorities have further categorized the six digit HSN into two digit sub-chapters, thus increasing the total number of digits to
be eight. This eight-digit code will be mandatory in case of export and imports under the GST regime.

Load More Related Articles
Load More By amitgupta
Load More In Goods & Service Tax

Leave a Reply

Check Also

How to Check BUSY Updates

How to Check BUSY Updates Company > Check BUSY Updates Check BUSY Updates option provid…