Power Plant Construction Services Under SAC Code 995426
Power plant construction services cover the main civil and structural work for thermal, hydro, solar and other power generation units. Contractors handle foundations, structures, equipment bases, control rooms and related buildings so that the site is ready for installation and commissioning. Under GST, this work is classified under SAC 995426. The SAC code and its GST rate decide how much GST is charged and how the value is recorded in GST returns.
Power Plant Construction Services GST Rate for SAC Code 995426
Power plant construction services are treated as works contracts or civil engineering services under GST. Earlier, different contract structures, milestone billing and supply splits sometimes led to different effective tax outcomes for similar power projects, which made costing and tax planning difficult for both contractors and project owners.
After the September 2025 rationalisation, construction of power plants and related generation facilities under SAC 995426 generally falls in the 18 percent slab with input tax credit. This standard rate applies to most power projects unless a specific notification grants concessional treatment for a particular strategic or government supported scheme.
The table below gives the latest GST rate for services under SAC code 995426.
| Code | Description | Old GST Rate (till 21 Sep 2025) |
New GST Rate (from 22 Sep 2025) |
Notes on change / inclusions |
|---|---|---|---|---|
| 995426 | General Construction services of Power Plants and its related infrastructure | 18% with ITC | 18% with ITC | Power plant and associated infrastructure construction is also treated as a standard works contract at 18 percent in current rate compilations, with the 56th Council focusing specific 12 to 18 percent changes on offshore and high earthwork contracts rather than this general power-plant SAC. |
When issuing invoices for services under SAC 995426, contractors should clearly show the taxable value and 18 percent GST so that project owners can claim input tax credit correctly. The same SAC code and rate should also be followed in GSTR 1 for outward supplies and in GSTR 3B while reporting the tax liability on power plant construction services.
Explore Other SAC Codes Under 9954
This SAC code forms part of the broader construction services group 9954, which covers construction of residential and commercial buildings, industrial plants, roads, bridges, dams, pipelines and other civil engineering works, along with site preparation and building completion services. Each six digit SAC within this group helps match contracts to the main type of structure or facility being created, repaired or removed.
These are the main related six-digit SAC codes under 9954
In day to day use, businesses should pick the SAC code that best reflects the dominant nature of the contract. If the work is more focused on buildings, local site development or routine maintenance, another SAC within 9954 may be more suitable than this one. Correct SAC selection and GST rate application help reduce future disputes, support a clean input tax credit trail and make GST records easier to explain during audits or departmental checks.
Conclusion
Power plant construction services under SAC 995426 cover the core civil and structural work for power generation facilities such as thermal, hydro and solar plants. These services are now generally taxed at 18 percent with input tax credit after the September 2025 changes. Contractors and project owners should ensure that their contracts are properly classified under this SAC code, apply the correct GST rate on each invoice and follow the same treatment in GST returns. For complex or multi stage power projects, it is wise to review the latest GST notifications and seek guidance from a qualified tax professional.
Important Disclaimer
The entire content on this page has been arranged to the best of the author's understanding and is subject to periodic updates as per the law for the time being in force. The above does not constitute professional advice or a formal recommendation. While due care has been taken in preparing this content, the existence of mistakes and omissions cannot be ruled out. BUSY Infotech Private Ltd. and its associates will not be held responsible for any loss or damage arising from any inaccurate or incomplete information in this document. We recommend consulting a professional tax consultant before acting on the information contained in this piece of content.
Frequently Asked Questions
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What services fall under SAC code 995426?
This code covers construction of power generating plants. It includes main civil and structural works for thermal, hydro, nuclear and renewable power plants, such as turbine halls, boiler foundations, chimneys, cooling towers, intake structures and related plant buildings.
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Is SAC 995426 used for thermal, hydro and renewable power plants?
Yes. Civil construction for thermal stations, hydropower plants, solar plants and wind farms is usually classified under 995426. Electrical erection, mechanical erection and instrumentation activities may use separate installation codes, but core civil works for generation facilities come here.
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What is the GST rate on power plant construction under SAC 995426?
Services under 995426 generally attract 18% GST. There are no broad exemptions just because it is a power project. Any special GST treatment must be clearly mentioned in a notification, so contractors should default to 18% unless they have a strong legal basis for another rate.
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Are transmission and sub station works also covered in SAC 995426?
Not always. Transmission lines and substations typically fall under other power transmission construction codes. However, civil structures inside the generation plant boundary that support equipment may still be covered by 995426 if they are integral parts of the generating station.
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Can project developers claim ITC for services under SAC 995426?
Developers selling power as a taxable business can usually claim ITC on GST paid to contractors. If electricity is treated as a non taxable output for some reason, ITC may not be allowed. Businesses must check how their output is treated before deciding on credit.