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The SAC code 9971 plays a vital role in classifying and regulating financial services provided by institutions such as banks, non-banking financial companies (NBFCs), insurance companies, and other entities operating in the financial sector. This code covers an extensive array of services associated with banking, lending, insurance, investment, and various other financial activities.
Under SAC code 9971, financial services such as account management, loan processing, investment advisory, insurance coverage, and various other financial transactions and services fall within its purview. It serves as a standardized classification system to accurately identify and categorize the diverse range of financial services provided by these institutions.
By utilizing the SAC code 9971, tax authorities can effectively determine the applicable GST rate for each specific financial service. This helps ensure proper taxation and regulatory compliance within the financial sector, while also facilitating seamless reporting and transparency in financial transactions.
SAC Code 9971 under GST can be classified in the following ways:
| SAC Code | Description | Rates(%) |
|---|---|---|
| 9971 | Services by the Reserve Bank of India. | Nil |
| 9971 | Services by way of: (a) extending deposits, loans or advances in so far as the consideration is represented by way of interest or discount (other than interest involved in credit card services); (b) inter se sale or purchase of foreign currency amongst banks or authorised dealers of foreign exchange or amongst banks and such dealers. | Nil |
| 9971 | Services of life insurance business provided by way of annuity under the National Pension System regulated by the Pension Fund Regulatory and Development Authority of India under the Pension Fund Regulatory and Development Authority Act, 2013 (23 of 2013). | Nil |
| 9971 | Services of life insurance business provided or agreed to be provided by the Army, Naval and Air Force Group Insurance Funds to members of the Army, Navy and Air Force, respectively, under the Group Insurance Schemes of the Central Government. | Nil |
| 9971 | Services by the EmployeesÕ State Insurance Corporation to persons governed under the EmployeesÕ State Insurance Act, 1948 (34 of 1948). | Nil |
| 9971 | Services provided by the Employees Provident Fund Organisation to the persons governed under the Employees Provident Funds and the Miscellaneous Provisions Act, 1952 (19 of 1952). | Nil |
| 9971 | Services provided by the Insurance Regulatory and the Development Authority of India to insurers under the Insurance Regulatory and the Development Authority of India Act, 1999 (41 of 1999) | Nil |
| 9971 | Services provided by the Securities and Exchange Board of India set up under the Securities and Exchange Board of India Act, 1992 (15 of 1992) by way of protecting the interests of investors in securities and to promote the development of, and to regulate, the securities market. | Nil |
| 9971 | Services by an acquiring bank, to any person in relation to settlement of an amount upto two thousand rupees in a single transaction transacted through credit card, debit card, charge card or other payment card service. Explanation.Ñ For the purposes of this entry, Òacquiring bankÓ means any banking company, financial institution including non-banking financial company or any other person, who makes the payment to any person who accepts such card. | Nil |
| 9971 | Services of general insurance business provided under following schemes Ð (a) Hut Insurance Scheme; (b) Cattle Insurance under Swarnajayanti Gram Swarozgar Yojana (earlier known as Integrated Rural Development Programme); (c) Scheme for Insurance of Tribals; (d) Janata Personal Accident Policy and Gramin Accident Policy; (e) Group Personal Accident Policy for Self-Employed Women; (f) Agricultural Pumpset and Failed Well Insurance; (g) premia collected on export credit insurance; (h)( Weather Based Crop Insurance Scheme or the Modified National Agricultural Insurance Scheme) substituted by [“Restructured Weather Based Crop Insurance Scheme (RWCIS)] on 22/08/2017, approved by the Government of India and implemented by the Ministry of Agriculture; (i) Jan Arogya Bima Policy; (j) [National Agricultural Insurance Scheme (Rashtriya Krishi Bima Yojana);] substituted by [Pradhan Mantri Fasal Bima Yojana (PMFBY)] on 22/08/2017 (k) Pilot Scheme on Seed Crop Insurance; (l) Central Sector Scheme on Cattle Insurance; (m) Universal Health Insurance Scheme; (n) Rashtriya Swasthya Bima Yojana; (o) Coconut Palm Insurance Scheme; (p) Pradhan Mantri Suraksha Bima Yojana; (q) Niramaya Health Insurance Scheme implemented by the Trust constituted under the provisions of the National Trust for the Welfare of Persons with Autism, Cerebral Palsy, Mental Retardation and Multiple Disabilities Act, 1999 (44 of 1999). | Nil |
| 9971 | Services of life insurance business provided under following schemes- (a) Janashree Bima Yojana; (b) Aam Aadmi Bima Yojana; (c) Life micro-insurance product as approved by the Insurance Regulatory and Development Authority, having maximum amount of cover of 50000 rupee(2 lakh substituted from 25/01/2018); (d) Varishtha Pension BimaYojana; (e) Pradhan Mantri Jeevan JyotiBimaYojana; (f) Pradhan Mantri Jan DhanYogana; (g) Pradhan Mantri Vaya Vandan Yojana. | Nil |
| 9971 | Services by way of reinsurance of the insurance schemes specified in exemption list(Sl no 35 or 36 or 40 of Notification no 12/2017) | Nil |
| 9971 | Services by an intermediary of financial services located in a multi services SEZ with International Financial Services Centre (IFSC) status to a customer located outside India for international financial services in currencies other than Indian rupees (INR). Explanation.- For the purposes of this entry, the intermediary of financial services in IFSC is a person,- (i) who is permitted or recognised as such by the Government of India or any Regulator appointed for regulation of IFSC; or (ii) who is treated as a person resident outside India under the Foreign Exchange Management (International Financial Services Centre) Regulations, 2015; or (iii) who is registered under the Insurance Regulatory and Development Authority of India (International Financial Service Centre) Guidelines, 2015 as IFSC Insurance Office; or (iv) who is permitted as such by Securities and Exchange Board of India (SEBI) under the Securities and Exchange Board of India (International Financial Services Centres) Guidelines, 2015. | Nil |
| 9971 | Services by Coal Mines Provident Fund Organisation to persons governed by the Coal Mines Provident Fund and Miscellaneous Provisions Act, 1948 (46 of 1948). | Nil |
| 9971 | Services by National Pension System (NPS) Trust to its members against consideration in the form of administrative fee. | Nil |
| 9971 | Services supplied by Central Government, State Government, Union territory to their undertakings or Public Sector Undertakings(PSUs) by way of guaranteeing the loans taken by such undertakings or PSUs from the financial institutions. | Nil |
| 9971 | Other Financial and related services | 18% |
| 9971 | Services by way of collection of contribution under the Atal Pension Yojana. | Nil |
| 9971 | Services by way of collection of contributions under any pension scheme of the State Governments. | Nil |
| 9971 | Services by the following persons in respective capacities Ð (a) business facilitator or a business correspondent to a banking company with respect to accounts in its rural area branch; (b) any person as an intermediary to a business facilitator or a business correspondent with respect to services mentioned in entry (a); or (c) business facilitator or a business correspondent to an insurance company in a rural area. | Nil |
| 9971 | Services provided to the Central Government, State Government, Union territory under any insurance scheme for which total premium is paid by the Central Government, State Government, Union territory. | Nil |
| 9971 | Services of life insurance provided or agreed to be provided by the Naval Group Insurance Fund to the personnel of Coast Guard under the Group Insurance Schemes of the Central Government. | Nil |
| 9971 | (iv) Leasing of aircrafts by an operator for operating scheduled air transport service or scheduled air cargo service by way of transaction covered by clause (f) paragraph 5 of Schedule II of the Central Goods and Services Act, 2017. Explanation.- (a) ÒoperatorÓ means a person, organisation or enterprise engaged in or offering to engage in aircraft operations; (b) Òscheduled air transport serviceÓ means an air transport service undertaken between the same two or more places operated according to a published time table or with flights so regular or frequent that they constitute a recognisable systematic series, each flight being open to use by members of the public; (c) Òscheduled air cargo serviceÓ means air transportation of cargo or mail on a scheduled basis according to a published time table or with flights so regular or frequent that they constitute a recognisably systematic series, not open to use by passengers. | 5% with No ITC taken |
| 9971 | Services provided by foreman of chit fund in relation to chit Explanation.- (a) ‘chit’ means a transaction whether called chit, chit fund, chitty, kuri, or by whatever name by or under which a person enters into an agreement with a specified number of persons that every one of them shall subscribe a certain sum of money (or a certain quantity of grain instead) by way of periodical instalments over a definite period and that each subscriber shall, in his turn, as determined by lot or by auction or by tender or in such other manner as may be specified in the chit agreement, be entitled to a prize amount; (b) Òforeman of a chit fundÓ shall have the same meaning as is assigned to the expression ÒforemanÓ in clause (j) of section 2 of the Chit Funds Act, 1982 (40 of 1982). | 12 – with ITC of input services |
| 9971 | Transfer of the right to use any goods for any purpose (whether or not for a specified period) | Same rate of GST and compensation cess as on supply of similar goods |
| 9971 | Any transfer of right in goods or of undivided share in goods without the transfer of title thereof | Same rate of GST and compensation cess as on supply of similar goods |
| 9971 | Leasing of motor vehicles purchased and leased prior to 1st July 2017; | 65 per cent. of the rate of integrated tax as applicable on supply of like goods involving transfer of title in goods. Note:- Nothing contained in this entry shall apply on or after 1st July, 2020. |
| 997111 | Central banking services | 18% |
| 997112 | Deposit services | 18% |
| 997113 | Credit-granting services including stand-by commitment, guarantees & securities | 18% |
| 997114 | Financial leasing services | 18% |
| 997119 | Other financial services (except investment banking, insurance services and pension services) | 18% |
| 997120 | Investment banking services | 18% |
| 997131 | pension services | 18% |
| 997132 | Life insurance services (excluding reinsurance services) | 18% |
| 997133 | Accident and health insurance services | 18% |
| 997134 | Motor vehicle insurance services | 18% |
| 997135 | Marine, aviation, and other transport insurance services | 18% |
| 997136 | Freight insurance services & Travel insurance services | 18% |
| 997137 | Other property insurance services | 18% |
| 997139 | Other non-life insurance services (excluding reinsurance services) | 18% |
| 997141 | Life reinsurance services | 18% |
| 997142 | Accident and health reinsurance services | 18% |
| 997143 | Motor vehicle reinsurance services | 18% |
| 997144 | Marine, aviation and other transport reinsurance services | 18% |
| 997145 | Freight reinsurance services | 18% |
| 997146 | Other property reinsurance services | 18% |
| 997149 | Other non-life reinsurance services | 18% |
| 997151 | Services related to investment banking such as mergers & acquisition services, corporate finance & venture capital services | 18% |
| 997152 | Brokerage and related securities and commodities services including commodity exchange services | 18% |
| 997153 | Portfolio management services except pension funds | 18% |
| 997154 | Trust and custody services | 18% |
| 997155 | Services related to the administration of financial markets | 18% |
| 997156 | Financial consultancy services | 18% |
| 997157 | Foreign exchange services | 18% |
| 997158 | Financial transactions processing and clearing house services | 18% |
| 997159 | Other services auxiliary to financial services | 18% |
| 997161 | Insurance brokerage and agency services | 18% |
| 997162 | Insurance claims adjustment services | 18% |
| 997163 | Actuarial services | 18% |
| 997164 | Pension fund management services | 18% |
| 997169 | Other services auxiliary to insurance and pensions | 18% |
| 997171 | Services of holding equity of subsidiary companies | 18% |
| 997172 | Services of holding securities and other assets of trusts and funds and similar financial entities | 18% |
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.
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