Deposit Under SAC Code 997112

Deposit services cover banking and financial services linked to savings accounts, current accounts and term deposits. Banks and financial institutions accept deposits, keep balances, provide statements and offer related value added services to customers. Under GST, such banking deposit services are classified under SAC 997112. This SAC code and its GST treatment decide how GST is charged on deposit related fees and charges, not on the deposit principal itself.

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997112 SAC Code GST Rate

Review old and new GST rates for Deposit under 997112 SAC Code.

Central banking, deposit and credit granting services under these codes are treated as financial services under GST. The main taxable portion is usually service fees, processing charges and other explicit charges, while interest on loans and advances can be exempt under separate provisions.

After the September 2025 rationalisation, fee based financial services that remain taxable are generally kept in the 18 % slab with input tax credit for registered recipients. Pure interest income without an explicit service fee usually continues to enjoy exemption where notified, so banks must split taxable charges from exempt interest carefully.

The table below explains the prevailing GST treatment for SAC code 997112, highlighting the standard 18 % rate on taxable financial service charges.

SAC Code

997112

Description

Deposit services

New Rate

0% without ITC

Old Rate

0% without ITC

Notes

Nil where the consideration is interest or discount; account fees, penalties and other charges are taxed at 18%, and services to Jan Dhan basic savings account holders are Nil. Source: Notification 12/2017-Central Tax (Rate), S. No. 27(a) and 27A.

Banks and financial institutions should map each charge such as processing fees, annual fees, locker rent or guarantee commission to the correct SAC, apply the proper GST rate in % and show the tax amount clearly on statements. The same SAC and rate should be used in GSTR 1 and GSTR 3B so that customers can claim input tax credit correctly and GST audits remain smooth.

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Explore More SAC Codes Under 9971

Practical Classification Guidance

Banks, NBFCs and other financial institutions should map each product to the correct SAC, distinguishing between taxable fee based services and exempt interest income. Correct SAC selection and GST rate application in % reduce disputes, help customers claim input tax credit on eligible charges and keep GST returns easier to justify during audits.

Conclusion

Deposit services under SAC 997112 cover banking activities linked to managing public deposits. While interest on deposits generally remains exempt, fee based services like account maintenance fees, cheque book charges and SMS alerts are commonly taxed at 18 % with input tax credit for registered customers. Banks should clearly separate exempt interest from taxable charges, apply SAC 997112 on relevant fees and use the same treatment consistently in GST returns.

Frequently Asked Questions

Clear answers to common queries about SAC Code 997112 and GST compliance.

What does SAC code 997112 cover in GST?

SAC 997112 covers services related to deposit accounts such as savings, current and fixed deposits. This includes opening accounts, account maintenance, cheque book issue and similar services offered by banks. Interest on deposits is treated differently from service charges for GST purposes.

Does SAC 997112 include savings, current and fixed deposit account services?

Yes. Bank services connected to maintaining savings, current, recurring and fixed deposit accounts fall under SAC 997112. While the interest earned by customers is not subject to GST, certain charges like account maintenance fees or cheque book charges can attract GST at standard service rates.

Which deposit related charges under SAC 997112 are taxable under GST?

Service charges such as account maintenance fees, cheque book charges, SMS alerts, locker rent and some penalty charges are generally taxable at 18%. The interest paid on deposits is not subject to GST. Banks need to clearly separate taxable service charges from exempt interest incomes.

Are interest earned on deposits covered by GST under SAC 997112?

No. Interest earned on deposits is generally treated as an exempt supply for GST purposes. Customers do not pay GST on the interest they receive from savings or fixed deposits. Only specified service fees charged by banks for account services fall under GST as taxable financial services.

Can banks claim ITC on input services related to taxable SAC 997112 charges?

Banks can claim ITC on inputs used for taxable services, but they also make a lot of exempt supplies like interest. So they usually follow special rules for banking and financial services, including reversal or proportionate credit, rather than claiming full ITC on all input taxes.

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Important Disclaimer

The above does not constitute professional advice or a formal recommendation. We recommend consulting a professional tax consultant before acting on the information contained in this piece of content.