Payroll Outsourcing Under SAC Code 998515

Payroll outsourcing services under this SAC code cover long term support where a service provider manages salary processing, statutory deductions and related compliances for an employer. Monthly payroll runs, payslip generation, PF and ESI calculations, TDS on salaries and basic reporting are normally covered in these payroll outsourcing and employee payroll services. Using this SAC code keeps payroll outsourcing fees clearly separate from staffing or recruitment spend in the books.

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998515 SAC Code GST Rate

Review old and new GST rates for Payroll Outsourcing under 998515 SAC Code.

Under GST, payroll outsourcing is treated as a business support and HR service. The taxable value generally covers fixed monthly fees, per employee processing charges, set up fees, year end processing and additional charges for statutory filings handled by the service provider.

Even before September 2025, such payroll services were typically taxed at the standard rate. After the GST slab changes, payroll outsourcing services under this code normally fall under the 18% slab in regular taxable situations, as they are professional and administrative support services.

The table below shows the latest standard GST rate for this SAC code.

SAC Code

998515

Description

Long-term staffing (pay rolling) services

New Rate

18% with ITC

Old Rate

18% with ITC

Notes

Payroll and long-term staffing services are ordinary support services taxed at 18% with input tax credit. The 5% options for transport and tour operators do not apply to them. Source: Notification 11/2017-Central Tax (Rate), S. No. 23(iii).

When issuing invoices, payroll service providers should describe the payroll outsourcing service, mention SAC 998515 and apply 18% GST wherever the fees are taxable, so that employers can easily reconcile HR costs and claim input tax credit if eligible.

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Explore More SAC Codes Under 9985

Practical Classification Guidance

This payroll focused code should normally be used when the service provider is primarily processing salaries and related statutory deductions, with or without advisory support. If the core service is providing manpower on site, running temp staffing, handling permanent recruitment or offering full co employment, a different SAC from the 9985 group should be selected.

Conclusion

This SAC code is intended for payroll outsourcing and employee payroll processing where an external partner manages salary calculations and compliance on behalf of an employer. Such services are ordinarily taxed at 18% under GST. Proper use of this code and rate helps both the payroll provider and the client keep HR compliance costs transparent and claim input tax credit in a clean manner. For complex structures involving international assignees or multiple group companies, it is helpful to review the GST position with a qualified adviser.

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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.