9971 Financial and related services
Heading 9971 of the SAC classification covers financial and related services. The schedule writes 3 entries against it, ranging from 5% to 18%, with 18% as the residual rate when no specific entry matches.
- Residual rate18%
- Service codes37
- Schedule entries3
Banking, lending, insurance, pensions, reinsurance and the auxiliary services around them, including broking, portfolio management and custody. Interest on deposits and loans is outside the tax net, and from 22 September 2025 individual life and health insurance became exempt.
Is this the right heading for your service?Confirm the code and the rate with an advisor, freeGST rate for SAC 9971
The rate schedule is written against the heading, so these entries govern every service code under 9971. The entry that applies is the one whose description actually matches the supply.
- Nil
- 1.5%
- 5% applies here
- 7.5%
- 12%
- 18% applies here
- 40%
| Entry | What it covers | GST rate | CGST + SGST | Input tax credit |
|---|---|---|---|---|
| (i) | Services of third party insurance of goods carriage. | 5% | 2.5% + 2.5% | Credit available |
| (ii) | Transfer of the right to use goods, or transfer of a right in goods or of an undivided share in goods without transfer of title, where the like goods attract their own rate. The rate is the same as the rate of GST on a supply of the like goods involving transfer of title. | Rate of the goods | As on the goods | Follows the goods |
| (iii) Residual | Financial and related services other than the above. | 18% | 9% + 9% | Credit available |
More than one entry can apply here. The one that governs is the entry whose description actually matches the supply; where none does, the residual entry sets the rate.
Rates shown here are as published in GST rates on services, Notification 11/2017-Central Tax (Rate) as amended up to Notification 15/2025-Central Tax (Rate) and are reproduced for reference. The GST Council revises rates through notifications, including the rate rationalisation effective 22.09.2025 that withdrew the 12% and 28% slabs for most services and introduced a 40% rate for a short list of them. Always verify the current rate and the conditions attached to it on the CBIC GST rates page or the CBIC tax information portal before invoicing or filing. Rates exclude any applicable cess. IncorpX provides assistance for GST registration and return filing if you need help.
Exempt supplies under 9971
Where an exemption applies it beats the rate schedule, so check these before reading a rate off the table above.
Some supplies under this heading carry no GST at all. An exemption removes the charge rather than setting a rate, so it overrides the schedule where it applies.
- Services by way of extending deposits, loans or advances where the consideration is represented by interest or discount, other than interest involved in credit card services. Notification 12/2017-CT(R), entry 27
- Individual life insurance and individual health insurance policies, including reinsurance of those policies, exempt with effect from 22 September 2025. Notification 16/2025-CT(R)
- Services by the Reserve Bank of India, and services by way of collection of contributions under specified pension and social security schemes. Notification 12/2017-CT(R), entries 26 and 36
- Services by way of the sale or purchase of foreign currency among banks or authorised dealers of foreign exchange. Notification 12/2017-CT(R), entry 39
Source: Exempt services, Notification 12/2017-Central Tax (Rate) as amended up to Notification 16/2025-Central Tax (Rate). Exemptions carry conditions and definitions of their own, so read the notification entry before relying on one.
Reverse charge under 9971
On these supplies the recipient pays the GST. The supplier's invoice carries no tax, which is exactly why the mistake is so easy to make in both directions.
On these supplies the recipient pays the GST, not the supplier. The supplier issues an invoice without charging tax and notes that tax is payable under reverse charge; the recipient pays it in cash and claims credit separately if eligible.
Services supplied by a recovery agent.
- Supplier
- A recovery agent
- Pays the tax
- A banking company, financial institution or non-banking financial company
Services supplied by an insurance agent.
- Supplier
- An insurance agent
- Pays the tax
- A person carrying on insurance business
Services supplied by a direct selling agent other than a body corporate, partnership or limited liability partnership firm.
- Supplier
- An individual direct selling agent
- Pays the tax
- A banking company or non-banking financial company
Source: Services taxable under reverse charge, Notification 13/2017-Central Tax (Rate) as amended. Separately from the entries above, any service bought from a supplier outside India is taxable under reverse charge in the recipient's hands, whatever code it carries. Reverse charge entries are amended often, so confirm the current position before you raise or accept an invoice.
37 service codes under 9971
Grouped the way the classification groups them. Open the group that matches your kind of service, then pick the code whose official description covers what you supply.
9971 1Financial services (except investment banking, insurance services and pension services)5
9971 2Investment banking services1
9971 3Insurance and pension services (excluding reinsurance services)8
9971 4Reinsurance services7
9971 5Services auxiliary to financial services (other than to insurance and pensions)9
9971 6Services auxillary to insurance and pensions5
Where SAC 9971 is used
The same code, at different digit lengths, runs through your invoices, returns and registration.
Rule 46 requires the SAC code on the invoice for every service line, next to its description and value.
Get assistanceThe HSN/SAC summary table of GSTR-1 reports each code with its taxable value and tax: 4 digits up to Rs. 5 crore aggregate turnover, 6 digits above it.
Get assistanceThe services you supply are described with SAC codes when the registration application is prepared for the GST portal.
Get assistanceThe e-invoice schema validates the SAC field before the IRP returns an IRN, so a wrong code fails at generation rather than at assessment.
Get assistance- Classification: Scheme of Classification of Services, Annexure to Notification 11/2017-Central Tax (Rate), Central Board of Indirect Taxes and Customs (cbic-gst.gov.in).
- Rates: GST rates on services, Notification 11/2017-Central Tax (Rate) as amended up to Notification 15/2025-Central Tax (Rate) (CBIC rate finder).
- Exemptions: Exempt services, Notification 12/2017-Central Tax (Rate) as amended up to Notification 16/2025-Central Tax (Rate).
- Reverse charge: Services taxable under reverse charge, Notification 13/2017-Central Tax (Rate) as amended.
- Current position: GST Council notifications published on the CBIC tax information portal.
This directory reproduces government classifications and rate entries for reference. The official gazette and CBIC notifications remain the authoritative sources. IncorpX provides assistance for registrations and filings that use these codes and does not issue the classification or the rates itself.
Get the SAC code and GST rate right the first time
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The invoicing and return rules that decide how this code is actually used.
SAC 9971 questions
What does SAC heading 9971 cover?
Heading 9971 of the SAC classification covers financial and related services. The schedule writes 3 entries against it, ranging from 5% to 18%, with 18% as the residual rate when no specific entry matches.
What is the GST rate for heading 9971?
It depends on which entry of the schedule matches the supply. Heading 9971 carries 3 entries at rates from 5% to 18%. Where no entry specifically matches, the residual entry applies and the rate is 18%. Several concessional entries are conditional on not taking input tax credit, so read the credit column before choosing.
Are any services under heading 9971 exempt from GST?
Yes. 4 exempt entries touch this heading, including services by way of extending deposits, loans or advances where the consideration is represented by interest or discount, other than interest involved in credit card services. An exemption removes the charge rather than setting a rate, so where it applies it overrides the rate schedule.
Does reverse charge apply to services under heading 9971?
Yes, for 3 notified categories. Where reverse charge applies the supplier issues an invoice without charging GST and the recipient pays the tax directly and claims credit separately if eligible. The exact categories are listed on this page.
How many digits of SAC 9971 do I report?
Report all 4 digits of 9971 on invoices and in the GSTR-1 summary if your aggregate turnover is up to Rs. 5 crore, and the full 6-digit code above that. Pick the 6-digit code from the list on this page.
Nebin Binoy 
