Garments and made-up textiles are 5% GST if the sale value is up to ₹2,500 per piece and 18% above. A garment shop's billing software should hold the right rate per item, track stock by size and colour, print barcode tags with MRP, and handle discounts. FundRaksha Book prints batch barcode labels with MRP and bills by scan, but it has no size or colour variant feature: each size or colour is set up as its own item.
GST on clothing and textiles
| Item | HSN | GST |
|---|---|---|
| Shirts | 6205 | 5% up to ₹2,500 per piece; 18% above |
| Jeans and trousers | 6203 | 5% up to ₹2,500 per piece; 18% above |
| T-shirts | 6109 | 5% up to ₹2,500 per piece; 18% above |
| Kurti | 6204 | 5% up to ₹2,500 per piece; 18% above |
| Bed sheets, towels | 6302 | 5% up to ₹2,500 per piece; 18% above |
| Cotton fabric, silk fabric | 5208, 5007 | 5% |
The ₹2,500 is the sale value of one piece, not the bill total. Three shirts at ₹1,200 each on one bill are all 5%, even though the bill is ₹3,600.
What a garment shop needs from billing software
- One rate per piece, set from the selling price. An item priced at ₹2,999 must be 18%; at ₹1,999, 5%.
- Size and colour. Stock by size (S, M, L, XL; 28 to 40) and colour so you know that the blue 32 is sold out.
- Tags. Barcode tags with the price and MRP for every piece received.
- Discounts. Line and bill discounts for sales and season-end offers, with the GST recomputed on the discounted value.
- Exchange and returns. Clothing shops see many size exchanges; decide how you will record them.
How FundRaksha Book handles it
Enter the supplier bill in Book with cost, profit % and the GST rate for each line; Book works out the selling price, and you can type a round price such as ₹1,499 and the margin updates. Each purchase line becomes a batch with its own barcode. On the labels screen, add the batch, pick a layout and print one tag per piece; on a part-used A4 sheet you tap the first empty label so no sticker is wasted.
Two honest limits. First, Book has no size or colour variants: create "Shirt slim blue 40" and "Shirt slim blue 42" as separate items, which also gives each its own barcode and stock. Second, the GST rate comes from the batch and does not switch automatically if a discount takes a piece across ₹2,500. Book also has no returns or credit note screen; record an exchange as a new bill and edit the earlier one, or follow the credit note format with your CA.
FundRaksha Book is free for the first 300 invoices, with every feature switched on and no card needed. Sales and purchase invoices both count. After that, Pro is ₹999 a year for unlimited invoices, paid by UPI, card or net banking; the site says prices include applicable taxes as charged at checkout. See book.fundraksha.com.
Worked example: a discount that changes the rate
A showroom in Ludhiana sells a jacket priced at ₹2,800 before tax. The rate is 18%: GST ₹504, total ₹3,304.
In an end-of-season sale the same jacket is sold at ₹2,400. Now the sale value per piece is below ₹2,500 and the rate is 5%: GST ₹120, total ₹2,520.
In Book, the simplest way to stay correct is to put sale stock in as its own item at 5% (or adjust the batch rate before the sale) rather than discounting the 18% item at the counter. Check doubtful cases on the GST calculator.
Sources
Last reviewed: 2026-10-21. Information for Indian businesses; not legal advice.