Linen Rental Service Services Under SAC Code 997325
Household linen rental services cover the hire of bed sheets, pillow covers, towels, table linen and similar items for homes, hotels, hostels and guest houses. Instead of buying and washing large stocks, businesses use household linen rental to keep rooms ready and hygienic with fresh linen on demand. Under GST, these services fall under SAC 997325. This SAC code and its GST rate decide how tax is charged on household linen rental invoices and related service fees.
Linen Rental Service Services GST Rate for SAC Code 997325
Under GST, leasing, rental and licensing services are treated as supply of services even when the underlying item is a movable good or an intangible like software. The taxable value normally includes base rental or licence fees, recurring usage charges and any service components that form part of the agreement price.
After the September 2025 GST slab revision, most taxable rental and licensing services that do not enjoy any special exemption or concessional entry are placed in the 18% slab with input tax credit for eligible registered recipients. Service providers should still track the latest notifications to confirm if any specific relief applies to their sector.
The table below summarises the latest standard GST rate for SAC code 997325 for household linen rental services.
| Code | Description | Old GST Rate (till 21 Sep 2025) |
New GST Rate (from 22 Sep 2025) |
Notes on change / inclusions |
|---|---|---|---|---|
| 997325 | Leasing or rental services concerning household linen. | 18% with ITC | 18% with ITC | Household linen rental falls in the same “other leasing” cluster under 9973. SAC-wise tools show 18% as the operative rate; the move to a 5% / 18% / 40% structure leaves this at the standard 18% slab. |
In most practical cases these services are taxed at 18%, and eligible registered business customers can claim input tax credit when the service is used for making taxable outward supplies. Service providers should apply the correct GST rate in % on the invoice value, mention the SAC code clearly and follow the same treatment in their GST records so that compliance stays smooth for both sides.
Explore Other SAC Codes Under 9973
All these SAC codes sit under the broader leasing, rental and licensing services heading 9973, which covers temporary use of goods and intellectual property against periodic charges. Each six digit SAC within this heading focuses on a specific type of rental or licensing service so that GST classification remains clear and consistent.
The list below highlights key six-digit SAC codes under 9973.
Service providers should map their main offering to the closest SAC code, whether they rent household linen, clothing, tools, other goods or provide software and database access. Using the correct six digit SAC and GST rate in % makes billing transparent, supports proper input tax credit for customers and reduces the chance of classification disputes during GST checks.
Conclusion
SAC 997325 is used for household linen rental services where bed sheets, towels, napkins and similar linen are supplied on hire to homes, hotels and hostels. These services are generally taxed at 18% under GST with input tax credit for eligible registered recipients. Correct use of SAC 997325, along with the right GST rate in %, helps both service providers and clients keep linen rental contracts and GST records neat and easy to explain.
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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SAC Code 997325 – Linen Rental Services
SAC 997325 covers rental services for household, hotel and hospital linen. This includes bedsheets, towels, table linen, uniforms and similar washable items supplied on demand. A laundry or rental company owns the linen, manages washing and rotation, and charges clients a recurring rental or service fee.
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Does SAC 997325 include rental of household and hotel linen on demand?
Yes. When hotels, hostels, hospitals or caterers use an outsourced linen service that supplies cleaned linen regularly instead of owning it, that service usually comes under SAC 997325. The provider is responsible for supplying usable linen sets as per agreed frequency and quantity, for a fixed charge.
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What GST rate applies to linen rental services under SAC 997325?
Linen rental and related services under SAC 997325 are usually taxed at 18%. The GST applies on service charges, whether billed as per kilogram, per piece or monthly rental. Any separate logistics or service fees also typically attract GST at the same standard service rate.
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Should hotels and hospitals use SAC 997325 for outsourced linen services?
Yes. Hotels, hospitals and other institutions should ensure that invoices from their linen service providers mention SAC 997325. When they recharge or allocate such costs inside packages, proper accounting helps in GST classification and avoids confusion between purchase of linen and a recurring rental and cleaning service.
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Can registered users claim ITC on GST paid for SAC 997325 services?
Registered businesses can usually claim ITC on GST charged for SAC 997325 services, as linen is an essential input for rooms, treatments or catering. ITC may not be available where the main outward supply is exempt or where usage is purely personal. Proper invoices and records are important.