Pharma Research Services Under SAC Code 998141
Pharma Research services help organisations explore new ideas, test hypotheses and generate reliable data for better decisions. In day to day work, clients engage research teams to design studies, run experiments, collect evidence and present findings in a structured way.
SAC 998141 is used when the core assignment relates to development of pharmaceutical r&d originals for new drugs and formulations. and often covers specialised topics such as pharmaceutical innovation.
Classifying these assignments under the correct SAC code gives clarity on how GST is applied on research fees and helps both parties keep a clean trail of the services received and delivered.
Pharma Research Services GST Rate for SAC Code 998141
From a GST point of view, pharma research fees are treated as supply of services. The taxable value usually includes project based fees, milestone payments, retainers and any related support charges that form part of the same research or advisory mandate.
After the September 2025 GST revision, most research and development services that do not have any special exemption notification continue to fall under the standard 18% slab. Registered business recipients can generally claim input tax credit when these services are used for making taxable supplies or for business decision making, subject to normal ITC conditions.
The table below explains the current standard GST rate for SAC code 998141.
| Code | Description | Old GST Rate (till 21 Sep 2025) |
New GST Rate (from 22 Sep 2025) |
Notes on change / inclusions |
|---|---|---|---|---|
| 998141 | Research and development originals in pharmaceuticals | 18% with ITC | 18% with ITC | R&D “originals” (intangible outputs) in pharma are listed with other research services at 18% with ITC. No new concessional entry appears in the 56th Council documents, so the rate stays 18%. |
In practice, organisations that provide pharma research should apply 18% GST on the taxable value, quote SAC 998141 on tax invoices and keep the same classification in their GST records so that project billing and input tax credit tracking stay simple.
Explore Other SAC Codes Under 9981
SAC 998141 falls under the wider heading 9981, which groups different types of research and development services. Each six digit SAC in this family points to a particular subject focus so that contracts and GST classification follow the actual nature of the work.
The list below highlights key six-digit SAC codes under 9981.
When selecting a code from the 9981 group, service providers should choose the SAC that best describes the central research area, whether it is pharma research or some other branch of study. Correct use of the six digit SAC and GST rate in % keeps research contracts, billing and ITC planning clear for both the provider and the client.
Conclusion
SAC 998141 is meant for pharma research where structured research work is carried out for a client in return for professional fees. These services are generally taxed at 18% under GST, with ITC normally available to eligible registered recipients when the research supports their taxable business activities. By using SAC 998141 consistently and applying the correct GST rate in %, organisations can keep their research mandates, invoices and GST compliance neat and easy to explain during reviews.
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 998141 in GST for pharma research services?
SAC 998141 covers creation of pharmaceutical R&D originals, such as new molecules, formulations or drug delivery systems. It is used when research work moves beyond trials and generates original pharmaceutical inventions, know how or proprietary formulations that can be licensed, produced or further developed for commercial drug manufacturing.
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Does SAC 998141 cover development of new pharmaceutical R&D originals and formulations?
Yes. Services for designing new active molecules, novel combinations, modified release formulations or specialised dosage forms typically fall under SAC 998141. The work results in original scientific outcomes, like dossiers, patents or proprietary formulations, which can be used by pharma companies for regulatory approvals and scaled commercial production later.
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What GST rate applies to services under SAC 998141?
Services under SAC 998141 are usually taxed at 18%. GST applies on fees for developing R&D originals, licences or technology transfer related charges. Because such projects are high value, parties should define taxable consideration, royalty structures and place of supply clearly to avoid later disputes or classification issues.
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Should pharma companies use SAC 998141 when outsourcing molecule or formulation research?
Yes, when the main objective is to create original pharmaceutical products or formulations, outsourcing contracts are typically billed under SAC 998141. Routine testing or clinical trials may use other SAC codes. Agreements should clearly state that the outcome is original R&D with rights, data and know how being transferred.
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Can they claim ITC on GST paid for SAC 998141 services used for commercial drug development?
Pharma companies can generally claim ITC on GST paid for SAC 998141 services when these R&D outputs support commercial manufacture and sale of taxable medicines. If products are exempt or supplies are zero rated exports, different rules may apply. Maintaining strong linkage between R&D cost and product lines is essential.