Freight is a service, so it carries a SAC (services accounting code), not an HSN. Transport of goods sits under heading 9965, and road transport by a goods transport agency (GTA) is commonly invoiced under SAC 996791. After the 56th GST Council changes effective 22 September 2025, a GTA charges 5% without input tax credit, or opts for 18% with full credit.
Facts checked: 9 October 2026. The GST Council's published FAQ on the 56th Council decisions (hosted on gstcouncil.gov.in, a PIB release) confirms the rate and option. We could not open the CBIC notification schedule itself, and the SAC code lists below come from software and tax-portal tables. Confirm the entry in the Central Tax (Rate) notification before invoicing.
Codes and rates at a glance
| Service | SAC | GST position |
|---|---|---|
| Transport of goods (heading) | 9965 | GTA entry: 5% without ITC, or 18% with full ITC |
| Goods transport agency, road | 996791 (as listed by software vendors) | Same option as above |
| Clearing and forwarding | 996713 | 18% |
| Other supporting transport services | 9967 | 18%, as listed |
| Container transport by a Container Train Operator | Heading 9965 | 5% without ITC or 18% with ITC (Council FAQ) |
| Multimodal transport of goods | Heading 9965 | 5% with restricted ITC if no air leg; 18% with full ITC if air transport is involved (Council FAQ) |
The GST Council FAQ says transport of goods by a GTA continues at the 5% merit rate with no ITC, with the GTA having the option to charge 18% with full ITC. The earlier alternative was 12% with ITC, so the practical change for a GTA is the rise of the optional rate from 12% to 18% (as reported by vendor tables and a transporter's customer letter). Several carriers bill by invoice date, with invoices dated up to 21 September 2025 at the old rate. That is billing practice, not law, so check your own contracts for services booked before the cut-off.
Local delivery through e-commerce operators is excluded from GTA services, and the operator is treated as the supplier at 18%, per the same FAQ.
Reverse charge or forward charge
Under the reverse charge notification (13/2017-Central Tax (Rate)), GST on road transport by a GTA is paid by the recipient, where the recipient is one of the notified categories such as a factory, society, body corporate, partnership firm or registered person. Read the entry for the exact list. In that case the GTA does not charge GST on the invoice, and the recipient pays 5% and, being a business, usually claims the credit.
A GTA can opt to pay GST under the forward charge instead. Reports on the 2023 amendments say:
- the option is exercised for a financial year by 31 March of the preceding year (notification 06/2023-Central Tax (Rate));
- a fresh declaration is not needed every year, and the option stays until the GTA reverts (08/2023-Central Tax (Rate)).
Check both notifications before advising a client to switch. If a GTA opts for forward charge at 18% with ITC, its invoice must show tax, and the customer takes the credit on the invoice.
What to put on the invoice
- Description: "Goods transport agency service" with the route or consignment note number, not just "freight".
- SAC: the code the GTA uses consistently, such as 996791.
- A statement of whether tax is payable on reverse charge, as the invoice rules require.
- The rate and amount of tax only if the GTA has opted for forward charge.
The GST tax invoice format has the full set of mandatory fields.
Worked example (illustrative numbers)
A GTA bills a registered manufacturer ₹1,00,000 for a road consignment. Under reverse charge, the GTA invoices ₹1,00,000 with no GST, and the manufacturer pays 5%, which is ₹5,000, in cash and claims it as input credit. If the GTA had opted for forward charge at 18%, it would bill ₹1,00,000 plus ₹18,000 GST, and the manufacturer would take the ₹18,000 as credit. The GTA's own diesel and vehicle-related credits come into the choice only on that route. Use the GST calculator to compare the two for a given invoice.
Frequently asked questions
What is the HSN code for freight charges?
Freight has no HSN because it is a service. It takes a SAC. Goods transport is under heading 9965, and GTA invoices commonly use 996791.
What is the GST rate on GTA services now?
5% without ITC, or 18% with full ITC at the GTA's option, per the GST Council FAQ.
Is freight forwarding the same as GTA?
No. Clearing and forwarding is listed under 996713 at 18%, while a GTA issues a consignment note for road transport.
Who pays GST on a GTA invoice?
Under the reverse charge, the notified recipient pays. A GTA that opted for forward charge collects the tax itself.
International sea freight follows import-of-service and place-of-supply rules and is not covered here.
Statutory facts on this page are checked against their sources, and the page says where it relied on secondary reporting. How we verify · Report an error