What is HSN Full Form?
Do you know what is the HSN Code Full Form? Harmonized System of Nomenclature (HSN) code is a standardized system of names and numbers that are used to classify goods for tax purposes. This system was developed by the World Customs Organization (WCO) and is used by over 200 countries globally, including India, to classify and identify goods for customs and tax purposes.
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What is the HSN code & HSN Full Form?
The HSN code is a widely recognized and standardized system for classifying goods in international trade. Developed by the World Customs Organization (WCO), the code assigns a unique number to each traded product, based on its economic activity or component materials. The HSN code is used by over 200 member countries of the WCO to maintain a global database of goods and to facilitate the flow of trade. The WCO regularly updates the HSN codes to reflect changes in global trade and new products. The latest edition, HSN 2022, went into effect on January 1, 2022, and includes new fields of trade.
What is the HSN code structure consist of?
The HSN code structure is hierarchical, with each digit representing a different level of classification. The first two digits represent the chapter, the next two digits represent the heading, the next two digits represent the subheading, and the last two digits represent the tariff item.
What are the Digits’ roles in the HSN code?
The HSN code is a system of digits that is used to classify goods for international trade. The code is divided into two parts, with the first six digits being universally accepted and the last six digits being added based on the specific requirements of the source country. The last six digits of the HSN code typically include information about the chapter, heading, and subheading of the goods being classified. However, it should be noted that different countries have different HSN code structures.
Some countries, such as India, have 8-digit codes, while others, such as many developed countries, have 10-digit codes. Additionally, some countries use the HSN code to classify goods for tariff and statistical purposes while other use it just for tariff purposes.
The first two digits represent the chapter, the next two digits represent the heading, the next two digits represent the subheading, and the last two digits represent the tariff item.
Explaining the different sections under the HSN code system
The HSN code structure is a hierarchical system and it is divided into four levels. The first level is the Section, which contains 21 sections. The second level is the Chapter, which contains 99 chapters. The third level is the Heading, which contains 1244 headings, and the last level is the Subheading, which contains 5224 subheadings. Each level is represented by a specific number of digits in the HSN code, with the Section represented by the first digit, the Chapter represented by the first two digits, the Heading represented by the first four digits, and the Subheading represented by the complete six-digit code.
HSN code structure example-
To help you understand the HSN code structure better, consider the following example –
An example is HSN-18.06.20, which refers to Chocolate and other food preparations containing cocoa.
- 18 – As you can see, the first two digits of the HSN code, 18, represent the chapter number that covers Sugar, sugar confectionery, and other articles.
- 06 – The next two digits of the HSN code represent the heading number that covers Sugar confectionery and other edible preparations not elsewhere specified or included.
- 20 – The last two digits of the code represent the product code for Chocolate and other food preparations containing cocoa.
What is the GST HSN code in India?
In India, HSN codes are used to classify goods under the Services and Accounting Code (SAC). GST HSN codes are used to determine the GST rate that should be applied to a particular product. The GST rate can vary depending on the type of product and its HSN code.
As a business owner, it is important to be aware of your obligations under the Goods and Services Tax (GST) laws in India. One of the requirements for compliance is to file regular returns with the government, including the GSTR-1 form.
The GSTR-1 form is a return that must be filed by businesses on a monthly or quarterly basis, depending on their turnover. It is used to report details of all outward supplies (sales) made during the relevant tax period. You can find more details on HSN declaration under GST by March 31, 2021, here:
As of March 31, 2021, businesses with a turnover of up to Rs 1.5 crore (15 million rupees) are not required to declare any HSN code in their GST returns. Businesses with a turnover ranging from Rs 1.5 crore to Rs 5 crore, on the other hand, must declare the first two digits of the relevant HSN code in their returns. Finally, businesses with a turnover above Rs 5 crore must declare the first four digits of the HSN code.
It is important for business owners to be aware of their turnover and the HSN declaration rules to be able to file their GST returns correctly and avoid penalties.
How to find the HSN code?
HSN code search in India can be done through the GST portal, where a list of HSN codes and GST rates can be found. Businesses can use these codes to correctly classify their goods and services for GST purposes.
Here are the steps to search for an HSN code in India:
- Go to the official GST website such as (https://www.gst.gov.in/).
- Click on the “Services” tab on the top menu bar and select the User Service option.
- Search for the “HSN Code” tab on the menu bar under the User Service option.
- Enter the name of the item you are searching for in the search bar and click on the “Search” button.
- The corresponding HSN code for the item will be displayed on the page.
HSN code list
The HSN code list is a comprehensive list of codes that are used to classify goods for tax purposes. The list is divided into chapters, headings, subheadings, and tariff items, and each code is unique. The list can be found on the GST portal and is updated regularly to reflect changes in goods and services. It is important for businesses to use the correct HSN code to ensure compliance with tax laws and regulations.
Other HSN Full Forms List
Harmonized System of Nomenclature is not the only full form of HSN. There are many more full forms in different categories which are related to the HSN word-
|Harmonized System of Nomenclature
|GST & Taxes
|Hopping Sequence Number
|Hardware Serial Number
|Hehre, Shusterman, and Nelson
FAQs- What is the HSN Code Full Form?
Q.1 What is the full form of the HSN code?
Ans. The HSN code full form stands for Harmonized System of Nomenclature.
Q.2. How many digits are in the HSN code of India?
In India, the HSN code consists of 8 digits.
Q.3. What is the HSN code used for?
These codes are used to classify and identify goods for tax purposes, making it easier for the government to track and collect taxes.
Q.4. Whose turnover is up to 1.5 crores, is it necessary to take the HSN code in the GST return?
Businesses whose turnover is up to or equal to Rs 1.5 crore (Rs 15 million) are not required to declare any HSN code in their GST returns.
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