HSN Code (Harmonised System of Nomenclature) is a six-digit code that classifies more than 5000 products according to well-established rules that is accepted worldwide. This code has been developed by the World Customs Organisation (WCO) to enable efficient international trade. Similarly, SAC (Services Accounting Code) is a six-digit code used to classify the different services that are rendered.
The Central Board of Indirect Taxes and Customs (CBIC) has mandated HSN Code or SAC for goods effective from 1 April 2021. That means when you create transactions and add items to them, the items must have the HSN Code or SAC associated to them.
According to CBIC, if your previous year’s annual turnover is less than ₹5 crores, you will have to use a 4-digit HSN Code or SAC and if it is more than ₹5 crores, you will have to use a 6-digit HSN Code or SAC.
In Zoho Books, we have built a bulk-update wizard to configure and update the items in your organisation with the HSN Codes or SACs. Once the HSN Codes or SACs are added to the items in Zoho Books, they will be auto-populated when you create transactions.
To configure HSN Codes or SACs:
If there are certain transactions that could not be updated with the HSN Codes or SACs, you will receive an email with the list of transactions that could not be updated. You can edit those transactions manually and update them.
Once the HSN Codes or SACs have been updated, they will be auto-populated when you create transactions with items.
and GST filing.