Software Download Services Under SAC Code 998434
Software download services under SAC 998434 cover electronic supply of software programs, applications and updates through the internet instead of physical CDs or DVDs. Customers usually pay to download licensed copies, activation keys or subscription based software directly from a portal or app store. The main supply here is the right to use software in digital form, and charges for such downloads are treated as taxable online software delivery services for GST purposes. This applies to both business tools and consumer apps delivered through online platforms.
Software Download Services GST Rate for SAC Code 998434
For GST treatment, software download services are considered supply of information technology and electronic services delivered online. The taxable value can include one time licence fees, subscription charges, upgrade packs and any bundled support fees that are inseparably linked to the digital software supply. This is different from physical media, where the goods and service split may need separate consideration.
After the September 2025 GST changes, most paid online software download services that are not explicitly exempt remain covered under the standard 18% slab. Business users who download software for accounting, ERP, design, security or other workplace needs can usually claim input tax credit when they are registered, use the software for taxable business activities and hold a valid invoice showing SAC 998434 and the GST charged.
The table below gives the prevailing standard GST rate for SAC code 998434.
| Code | Description | Old GST Rate (till 21 Sep 2025) |
New GST Rate (from 22 Sep 2025) |
Notes on change / inclusions |
|---|---|---|---|---|
| 998434 | Software downloads | 18% with ITC | 18% with ITC | Download of software and related electronic products is covered by heading 9984 and OIDAR guidance confirms an 18% GST rate, with the ebook specific 5% entry kept separate. |
When raising invoices, suppliers of software download services should charge 18% GST on eligible fees, mention SAC 998434 and keep their GST records aligned so that the software income and tax are easy to reconcile.
Explore Other SAC Codes Under 9984
SAC 998434 is part of heading 9984, which groups telecommunication, broadcasting and information supply services including broadband, streaming and digital content delivery. Within this heading, software download services are treated as a specific type of digital content and IT service supplied over networks.
Some cover online information services, some focus on audio or video streaming, and others deal with broader digital content services, each intended for a clearly defined type of internet based supply.
These are the main related six-digit SAC codes under 9984.
For the 9984 group, this code will usually be chosen when the main supply is online software purchase and download, rather than general content or connectivity. Other SAC codes in the heading should be used when the service is broadband access, online information, digital audio, digital video or mixed content where software delivery is not the primary element.
Conclusion
This code is meant for software download services where software is supplied in digital form over the internet, including licences, upgrades and subscription based apps. The code is normally taxed at 18% under GST, and applying it with the correct rate in % helps both software vendors and customers keep invoicing, ITC claims and GST returns straightforward. It is wise to review the latest GST circulars and discuss edge cases like bundled training, hardware or foreign currency billing with a tax consultant.
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.