BUSY is a simple, yet powerful GST / VAT compliant Business Accounting Software that has everything you need to grow your business.
The Information Technology (IT) sector is the backbone of modern India, covering everything from software development to cloud hosting and tech support. But how does GST (Goods and Services Tax) apply to these services? In this blog, we’ll explain the GST rate for IT services in India, what qualifies as an IT service, and how businesses in this space can manage their tax obligations.
Yes, most IT services are fully taxable under GST, and the standard rate is 18%.
IT services fall under SAC Code 9983 – Information Technology Services, which includes:
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| IT Service | SAC Code | GST Rate |
|---|---|---|
| Software development (customized) | 9983 | 18% |
| IT consulting services | 9983 | 18% |
| Cloud hosting (SaaS, IaaS) | 9983 | 18% |
| Tech support and maintenance | 9983 | 18% |
| Data storage or processing services | 9983 | 18% |
| Type of Software | GST Rate | Category |
|---|---|---|
| Off-the-shelf (boxed/downloadable) software | 18% | Treated as goods (HSN Code 8523) |
| Customized software development | 18% | Treated as service (SAC 9983) |
| Software as a Service (SaaS) | 18% | Treated as service |
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No! Export of services (to clients outside India) is zero-rated under GST.
This benefits freelancers, SaaS businesses, and IT firms serving overseas clients.
Yes, businesses offering IT services can claim Input Tax Credit on:
Proper billing and GST-compliant invoices are required to utilize this benefit.
BUSY is a simple, yet powerful GST / VAT compliant Business Accounting Software that has everything you need to grow your business.