SAC Code 998391
Specialty Design Services
Industrial, fashion, graphic and other specialty design.
What this SAC code covers
Catch-all for specialty design — industrial design, fashion design, jewellery design, packaging design, and graphic design where 998365 (web page design) does not apply.
Common services billed under SAC 998391
- Industrial design
- Packaging design
- Brand identity
- Graphic design
GST split: CGST, SGST, and IGST
The 18% GST on SAC 998391 splits depending on whether the supply is intra-state or inter-state:
| Scenario | Tax type | Rate |
|---|---|---|
| Same state as your GSTIN (intra-state) | CGST | 9% |
| SGST | 9% | |
| Different state from your GSTIN (inter-state) | IGST | 18% |
Statutory reference
Notification 11/2017-CT(R) dated 28 June 2017, Schedule II, Heading 9983 — taxable at 18%.
Place of supply
Section 12(2)(a) of the IGST Act — location of the registered recipient. For a brand-identity engagement with a multi-state retail client, raise the invoice to the head-office GSTIN unless the engagement letter specifies state-level scope.
Export-of-service treatment
Zero-rated under Section 16 of the IGST Act for foreign-client design engagements. File LUT for the FY, invoice in client currency at 0% GST, hold FIRC.
Reverse charge (RCM)
Not under reverse charge. Not under reverse charge — the supplier collects and remits GST in the normal forward-charge manner. Reverse charge under Section 9(3) of the CGST Act applies only to a notified list (GTA services, advocate services, sponsorship, director-fee payments by companies, and a handful of others).
Composition scheme for services
Freelancers and small service businesses with aggregate turnover under Rs. 50 lakh in the prior financial year may opt for the composition scheme for services and pay GST at a flat 6% instead of the standard 18%, in exchange for forgoing input tax credit. Useful when your input costs are minimal and your clients do not need ITC (i.e., B2C-heavy practices). Opt in via Form GST CMP-02 on the GST portal at the start of the FY.
Input Tax Credit for the client
Fully claimable when the design output is used for the business — brand identity for a SaaS product, packaging for a CPG SKU, etc. Not blocked under Section 17(5).
GSTR-1 reporting
GSTR-1 Table 12 + Table 4A (B2B). Distinct from 998314 (software UI/UX design) — 998391 is the right SAC when the deliverable is print/identity/industrial, not screen.
Worked example
A freelance brand-identity designer in Pune (MH state code 27) creates a logo + brand system for a Hyderabad-based D2C cosmetics startup (TS state code 36). Rs. 1,00,000 fixed-price. Inter-state → IGST 18%.
Invoice of Rs. 1,00,000 under SAC 998391:
- Intra-state client (same state):
- CGST @ 9%: Rs. 9,000
- SGST @ 9%: Rs. 9,000
- Invoice total: Rs. 1,18,000
- Inter-state client (different state):
- IGST @ 18%: Rs. 18,000
- Invoice total: Rs. 1,18,000
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Related SAC codes
If SAC 998391 does not exactly fit your service, consider these alternatives:
- SAC 998314 — Information Technology Design and Development Services — Custom software development and design — the most common freelance dev SAC.
- SAC 998361 — Advertising Services — Ad creation, campaign design and media placement.
- SAC 998392 — Photography Services — Commercial, editorial and event photography.
Related GST terms
Plain-English definitions for the GST concepts behind this SAC:
- GSTR-1 — Monthly or quarterly return of outward supplies (sales) filed by every registered taxpayer.
- GSTR-3B — Monthly summary return where you pay GST liability and claim Input Tax Credit.
- GSTR-2B — Auto-drafted, static monthly ITC statement showing which inward supplies you can claim.
- CGST, SGST, and IGST — Three GST components: Central GST, State GST, and Integrated GST.
- SAC (Services Accounting Code) — 6-digit code that classifies services for GST reporting (the services equivalent of HSN).
Key rules to remember
- SAC is mandatory on every B2B invoice when your aggregate turnover in the preceding financial year was Rs. 5 crore or more. For freelancers below that, SAC is optional but recommended.
- Use 6-digit SAC on invoices issued to GST-registered customers; 4-digit for unregistered customers in B2CS supplies.
- GSTIN-to-state mapping determines intra-state vs inter-state. The first two digits of your GSTIN and your client's GSTIN tell the system which split to apply.
- Place of supply may override location for some services (e.g., events, training). Verify under Section 12 of the IGST Act if your service has a defined place of supply rule.
Common mistakes (CA-flagged)
- Using 998391 for UI/UX design — that is 998314 (Information Technology Design and Development). 998391 is for non-screen design (print, packaging, industrial, identity for print/POS).
- Mixing photography or video deliverables on a 998391 invoice — photography is 998392; combined invoices need separate SAC lines.
Sources