If your aggregate turnover in the previous financial year was up to ₹5 crore, show at least 4 digits of HSN on tax invoices. Above ₹5 crore, show 6 digits. A business with turnover up to ₹5 crore may leave out the HSN digits on invoices to unregistered buyers (B2C). As of 21 October 2026, CBIC has not changed this table.
The rule in one table
| Aggregate turnover in preceding FY | HSN digits on tax invoice |
|---|---|
| Up to ₹5 crore | 4 (may be omitted on B2C invoices) |
| More than ₹5 crore | 6 |
Aggregate turnover is computed on an all-India PAN basis, so add the turnover of every GSTIN under the same PAN. The test year is the previous financial year: for invoices issued in FY 2026-27, look at FY 2025-26.
What 4 and 6 digits mean in practice
Four digits is the heading. A shop under ₹5 crore selling ghee writes 0405; a mobile shop writes 8517 for phones. Six digits is the international sub-heading, which narrows a heading. A business above ₹5 crore must therefore know the sub-heading of each item, which is usually printed on the manufacturer's purchase invoice.
Writing more digits than required is always allowed. Many small businesses copy the 8-digit code from their supplier's bill, which is fine and saves trouble if turnover later crosses ₹5 crore.
The B2C relaxation
The proviso added in 2020 lets a registered person with aggregate turnover up to ₹5 crore skip the HSN digits on tax invoices for supplies to unregistered persons. A retail counter selling to walk-in customers can therefore print bills without HSN. The relaxation does not apply to invoices issued to GST-registered buyers, and it is not available above ₹5 crore.
The HSN summary in GSTR-1 is a separate return requirement. Keep HSN on every item in your billing software even if your B2C bills do not print it, because the summary is built from item data.
Common mistakes to avoid
- Checking turnover of one GSTIN only. Aggregate turnover is PAN-wide, so a second branch registration can take you over ₹5 crore.
- Using the current year's turnover. The test is always the preceding financial year.
- Dropping HSN on B2B invoices because the business is small. The relaxation covers only supplies to unregistered persons.
- Writing a code that does not match the rate. If the bill says 0405 (ghee) the rate must be 5%; a mismatch invites a notice.
- Typing codes by hand on each bill. Set the code once per item so it is consistent across invoices and returns.
Worked example
A Pune hardware dealer had aggregate turnover of ₹3.8 crore in FY 2025-26. In FY 2026-27 its invoices to contractors with a GSTIN must show at least 4 digits, such as 2523 for cement and 7214 for TMT bars, while its counter bills to walk-in customers may omit HSN. In FY 2026-27 turnover reaches ₹5.6 crore. From 1 April 2027 every tax invoice must show 6 digits, including counter bills, so the dealer updates its item master before the new year.
Do it automatically in FundRaksha Book
Store the full HSN code once per item in FundRaksha Book and the invoice prints the digits you need, while the HSN-wise summary is ready for GSTR-1. Check a buyer's GSTIN status on FundRaksha Trust before you treat a sale as B2B.
Last reviewed: 2026-10-21. Information for Indian businesses; not legal advice.