Construction Equipment Rental Services Under SAC Code 997313
Construction equipment rental services cover the hire of cranes, excavators, concrete mixers, loaders and similar heavy machinery required at building and infrastructure sites. Contractors and builders use heavy machinery leasing to complete projects on time without investing in every machine permanently. Reliable construction equipment rental with or without operators allows companies to manage peak demand and specialised jobs. Under GST, these construction equipment rental services come under SAC 997313. This SAC code and its GST rate decide how GST is applied on machinery hire charges and related support services.
Construction Equipment Rental Services GST Rate for SAC Code 997313
Leasing and rental services under group 9973 are treated as supply of services under GST, even when the underlying item is a movable good. The taxable value usually includes the base rental charge, operator or driver fees where machines are supplied with manpower and any maintenance or handling fees that form part of the contract. Refundable security deposits and pure reimbursements of government levies can be kept outside the taxable value only when the conditions given in GST law are fully met.
After the September 2025 GST rate changes, most taxable leasing and rental services that are not covered by a special concessional entry are generally placed in the 18% slab with input tax credit for eligible registered business customers. Service providers should still check the latest notifications and circulars, as certain government schemes or specified sectors may enjoy different treatment for particular types of rental contracts.
The table below sets out the latest standard GST rate for SAC code 997313 applicable to construction equipment rental services.
| Code | Description | Old GST Rate (till 21 Sep 2025) |
New GST Rate (from 22 Sep 2025) |
Notes on change / inclusions |
|---|---|---|---|---|
| 997313 | Leasing or rental services concerning construction machinery and equipment with or without operator | 18% with ITC | 18% with ITC | Construction machinery leasing is generally a business to business capital service and is placed at 18% in GST rate finders and explanatory notes on lease services. No new concessional slab or exemption for this code appears in the September 2025 decisions. |
Once the correct GST rate is identified, rental providers should apply that rate in % on the taxable rental value, mention the SAC code clearly on invoices and keep their GST positions consistent across contracts and returns so that customers can plan cash flow and input tax credit smoothly.
Explore Other SAC Codes Under 9973
All these SAC codes fall under the broader leasing and rental services group 9973, which covers rental of machinery, equipment and other goods with or without operator. Each six-digit SAC within this group points to a specific type of rental service so that GST classification and reporting remain clear and structured.
Below is a list of related six-digit SAC codes under 9973.
Service providers should select the SAC that matches the main equipment being rented, whether it is agricultural machinery, construction equipment, office machines, computers or telecom and network gear. Using the correct six digit SAC and GST rate in % makes billing more transparent, supports proper input tax credit for customers and reduces the risk of disputes during GST reviews.
Conclusion
SAC 997313 is used for construction equipment rental services such as crane hire, excavator rental and other heavy machinery used at project sites. Rental charges under this SAC code generally attract 18% GST with input tax credit for registered builders and contractors. Consistent use of SAC 997313 and the appropriate GST rate in % helps in clear project costing, client billing and smooth GST reporting.
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 997313 in GST for construction equipment rental?
SAC 997313 covers rental of heavy construction machinery such as cranes, excavators, concrete pumps, loaders and similar equipment. It applies when contractors or equipment owners hire out these machines to builders or other contractors, with or without operator, without transferring ownership of the machinery.
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Does SAC 997313 cover rental of construction machinery like cranes and excavators?
Yes. Short term or project based hiring of cranes, excavators, boom placers, piling rigs and other construction machines is generally classified under SAC 997313. Whether the machine comes with an operator or only on hire, the underlying supply is treated as a rental or leasing service.
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What GST rate applies to construction equipment rentals under SAC 997313?
Construction equipment rentals under SAC 997313 are normally taxed at 18%. The tax is charged on the rental value plus any related service charges. Service providers should check current notifications in case any specific concessional rate or reverse charge provision applies to particular types of contracts.
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Should contractors use SAC 997313 when hiring machinery with or without operator?
Yes. Contractors who rent equipment from other suppliers should expect invoices mentioning SAC 997313. Where they themselves sub rent machinery as a separate service, they should also use this code. If the equipment hire is part of a composite works contract, overall classification rules for works contracts will apply.
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Can builders claim ITC on GST paid for SAC 997313 rentals used in projects?
Builders and contractors can often claim ITC on GST paid for SAC 997313 rentals when machinery is used for taxable works contracts, such as construction of commercial property. However, credit may be blocked for certain own use immovable property construction, so each project’s nature must be examined carefully.