Structural Demolition Services Under SAC Code 995431
Demolition services cover safe pulling down of old buildings, structures and facilities before new construction or redevelopment. Contractors handle planning, dismantling, debris removal and basic site clearing so that the land is ready for the next project. Under GST, this work is classified under SAC 995431. The SAC code and its GST rate decide how much GST is charged and how the value is written in GST returns.
Structural Demolition Services GST Rate for SAC Code 995431
Demolition services are treated as works contract or specialised construction related services under GST. In the earlier phase, different contract styles and composite billing with site clearance or scrap sale sometimes produced different effective tax results for similar demolition jobs, creating uncertainty for contractors and clients.
After the September 2025 rationalisation, demolition services covered under SAC 995431 generally fall in the 18 percent slab with input tax credit. This standard rate applies to most demolition projects unless a specific notification provides a different treatment for a particular type of redevelopment or public scheme.
The table below gives the latest applicable GST rate for SAC code 995431
| Code | Description | Old GST Rate (till 21 Sep 2025) |
New GST Rate (from 22 Sep 2025) |
Notes on change / inclusions |
|---|---|---|---|---|
| 995431 | Demolition services | 18% with ITC | 18% with ITC | Demolition services, when taxable, are classified under 99543 and are listed with the general construction service rate of 18 percent in SAC wise compilations. |
When raising invoices for services under SAC 995431, contractors should clearly show the taxable value and 18 percent GST so that eligible clients 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 when reporting the tax liability on demolition 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.
Below is a list of 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
Demolition services under SAC 995431 cover safe pulling down of old buildings and structures before new construction or redevelopment. These services are now generally taxed at 18 percent with input tax credit after the September 2025 changes. Contractors and clients should confirm that demolition contracts are properly classified under this SAC code, apply the appropriate GST rate on every invoice and report the same classification in GST returns. For projects with complex redevelopment terms or scrap sale arrangements, it is sensible to review the latest GST notifications and seek advice from a 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 is SAC code 995431 used for in GST?
This code is used for demolition of buildings and civil structures. It covers controlled and uncontrolled demolition, dismantling and removal of structures, often as a first step before redevelopment or new construction on the same site.
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Does SAC 995431 cover structural and building demolition services?
Yes. Demolishing residential, commercial or industrial buildings, chimneys, towers or tanks is generally classified under 995431. It includes mechanical demolition using excavators, manual breaking, controlled blasting where permitted and other methods used to safely bring down structures.
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What GST rate applies to services under SAC 995431?
Demolition services under this code normally attract 18% GST. There are no broad zero or reduced rates simply for demolition. Contractors should charge 18% on the service value, including debris handling if it is part of the same demolition contract.
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Are partial demolition and dismantling works also under SAC 995431?
Yes. Partial demolition, stripping of certain structural elements, dismantling walls or roofs and similar works usually fall under this code when the main purpose is removing or breaking the structure. If work mainly involves installing new components, another SAC may be more suitable.
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Can demolition contractors claim ITC for expenses under SAC 995431?
Demolition contractors can generally claim ITC on GST paid for machinery rentals, equipment repairs, safety gear and other taxable inputs used in their contracts. The client’s ITC depends on how they use the cleared site and whether the resulting project is for taxable business or not.