Graphic Design HSN Code

Understanding the Graphic Design HSN Code

Graphic design is a dynamic field, blending creativity with technical skill to create visual communications. For graphic designers and businesses offering design services in India, understanding the appropriate HSN (Harmonized System of Nomenclature) code for GST (Goods and Services Tax) purposes can seem a bit intricate. It’s crucial to differentiate between the service of graphic design itself and the tangible outputs or tools associated with it.

Graphic Design Services: The SAC Code Perspective

When we talk about the “Graphic Design HSN Code” in the context of services, we are actually referring to the Service Accounting Code (SAC), which is used for classifying services under GST. Graphic design services typically fall under a broad category of professional, technical, and business services.

The most relevant SAC code for graphic design services is:

• SAC 998391: “Specialty design services including interior design, fashion design, industrial design and other specialty design services.” Graphic design fits well within “other specialty design services.”

Services classified under SAC 998391 generally attract an 18% GST rate, effective from July 1, 2017. There might be specific exemptions, as noted in the data for services related to the FIFA U-17 Women’s World Cup 2020, where the GST rate was Nil if certified by the Director (Sports), Ministry of Youth Affairs and Sports. However, this is a very specific, time-bound exemption.

It’s important to note that the GST is applied to the service provided by the graphic designer, regardless of whether the final output is a digital file or a printed item.

Tangible Outputs: Printed Materials and Graphic Paper

While the core of graphic design is a service, the output often manifests as tangible goods. These printed materials or the paper used for graphic purposes have their own distinct HSN codes.

• Printed Pictures and Designs:
  • Chapter 49 covers “Printed books, newspapers, pictures and other products of the printing industry; manuscripts, typescripts and plans.”
  • HSN 49119100: “Other printed matter, including printed pictures and photographs – Other: Pictures, designs and photographs.”
  • HSN 49111090: “Trade advertising material, commercial catalogues and the like: Other” (which could include printed graphic designs for promotional use).

These printed materials typically attract an 18% GST rate, effective from July 1, 2017.

• Paper for Graphic Purposes:
  • Chapter 48 deals with “Paper and paperboard; articles of paper pulp of paper or of paperboard.”
  • HSN 4802: “Uncoated paper and paperboard, of a kind used for writing, printing or other graphic purposes, and non-perforated punch card and punch tape paper, in rolls or rectangular (including square) sheets of any size…”

Various sub-headings under HSN 4802 exist based on weight, size, and composition (e.g., 48026230 for “Printing paper dyed/marbled in mass”). These papers generally carry a 12% GST rate, effective from July 1, 2017.

Hardware and Software for Graphic Design

The data also mentions HSN codes for components related to graphic functionality in machinery:

• HSN 84733092: “Parts and accessories… for machines of heading 8471 (Automatic data-processing machines and units thereof): Graphic and intelligence based script technology.” This is for components like graphics cards. These attract an 18% GST rate.

This HSN code is for the physical hardware component, not the graphic design service or the software used for design.

The Importance of Correct Classification

Accurate HSN (or SAC) code classification is paramount for graphic designers and related businesses for:

• GST Compliance: Ensures the correct GST rate application, avoiding penalties and legal issues.
• Input Tax Credit (ITC): Allows eligible businesses to claim ITC on GST paid for business expenses like software subscriptions, computers, or printing services.
• Business Operations: Streamlines invoicing, accounting, and overall financial management.

For clarity and compliance, always determine whether you are providing a design service, selling a printed product, or dealing with specific hardware/materials.