New

Published on:

August 28, 2024

Viraaj Vashishth

Blog |

Explore GST

Basics of GST

Wooden Furniture: 9403 HSN Code and GST Rate

Household and company furniture has always been equated with wooden materials. The appeal of wood furniture is timeless, durable, and comes in different forms that enhance the aesthetic aspect of various spaces. Wooden furniture consists of chairs, tables, cupboards, or beds, the demand of which cuts through generations as well as boundaries. But if wooden furniture means so much to our lives then we should also know how the Indian Goods and Services Tax (GST) system taxes it; this is important for the manufacturers, sellers and buyers as well. This article will focus on furniture HSN code 9403 and its associated GST rate for Wooden furniture.

Understanding HSN Code

Harmonized System of Nomenclature (HSN), is a universally recognized system used for organizing goods by classifying them systematically. The World Customs Organization (WCO) created the HSN codes to standardize goods classification procedures worldwide. In India, HSN codes are a vital part of the tax system more so under the GST regime. They are critical in ensuring correct tax calculations hence making tax returns easier for businesses

Wooden Furniture HSN Overview

The HSN Code 9403 is on "Other furniture and parts thereof". This entails a wide category of furniture, such as home and office wooden furniture. Such products under HSN Code 9403 range from readymade ones to custom-made pieces. The code encompasses wooden furniture which includes among others:

1. Wooden chairs and tables

2. Beds and wardrobes

3. Wooden cabinets and shelves

4. Office desks and workstations

9403 HSN Code GST Rate

Goods and Services Tax (GST) in India is a complete indirect tax on the manufacturing, sale, and consumption of goods or services. GST came into effect in July 2017 to replace several indirect taxes thereby simplifying the tax regime while ensuring that it becomes uniform across the country. Businesses should know what GST rate they are liable for so that they comply with it to avoid any penalties.

GST Rate Levied

HSN Code 9403 divides wooden furniture into classes each having a different GST rate. The GST rate for wood furniture is mostly set at 18%, which applies to the majority of normal furniture pieces. Some products within this HSN code, however, have been assigned a unique tax rate depending on their exact classification or customization aspects. In general, these rates apply to various categories of wooden furniture:

Furniture Type	HSN Code	GST Rate
Ready-made wooden furniture	9403	18%
Custom-made wooden furniture	9403	18%
Wooden furniture used in offices	9403	18%
Wooden furniture for educational institutions	9403	18%
Specialized wooden furniture (e.g., for medical use)	9403	May vary (e.g., 12%)

Businesses need to be aware of this standard GST rate across various wooden furniture divisions.

Classification of Wooden Furniture Under HSN Code 9403

The design, usage and customization determine the categorization of wooden furniture under HSN Code 9403. This classification is significant in listing down the exact GST rates that apply per unit chargeable. These are the main types of wooden furniture based on HSN Code 9403;

1. Household Wooden Furniture; This category comprises beds, tables, chairs and cabinets made for home use.

2. Office Wood Furniture; It consists of desks, workstations, conference tables and office chairs.

3. Outdoor Wood Furniture; Such as garden benches, and patio sets including deckchairs.

4. Customized Wooden Furniture; This means individual customers design furniture according to their requirements which may influence the GST rate.

GST rates are affected by the classification of wooden furniture under HSN Code 9403. This means that specialized furniture used for medical or educational purposes may attract a lower rate (e.g., 12%) while standard household and office furniture is taxed at 18%. Classifying their items correctly is vital for businesses to ensure the correct taxation and compliance with GST laws.

Exemptions and Special Cases

While most wooden furniture items attract GST, certain exceptions may apply under specific circumstances. For instance, goods supplied to government organizations or non-profit institutions for charitable purposes might be free from tax. In a similar vein, various public welfare projects use woodwork which can also lead to exemptions.

The relevant GST rate can be affected by some special cases like the export or importation of wooden furniture. Exporting wooden furniture, for example, could mean zero-rated GST where no tax is charged on export sales. Furthermore, businesses that supply woodwork to non-profit education institutions may enjoy reduced rates of GST or exemptions from it.

Compliance and Documentation

To producers and sellers of wooden furniture, adherence to the GST rules is very important. It involves proper billing, correct HSN code declaration and timely filing of GST returns. Failure to observe the GST laws can lead to penalties and business interruption. Key Compliance requirements include:

1. Accurate Invoicing: Ensuring that invoices carry the correct HSN code (9403) applicable GST rate

2. Proper Record-Keeping: Maintaining well-detailed records about all transactions including sales, purchases, and GST payments.

3. Timely GST Return Filing: Filing monthly or quarterly returns as per the regulations on GST.

Role of HSN Code in Filing GST

HSN Code 9403 plays a crucial role in simplifying the goods and service tax filing process for businesses involved in wood furnishings. By using the right HSN code, companies can make sure they are applying the accurate rates of taxation which will make filing easier and reduce chances of mistakes or fines. Misuse of HSN codes could lead to errors in tax calculations as well as compliance problems that’s why it is important to get it right at first time.

Conclusion

For manufacturers, sellers and buyers, understanding the HSN Code 9403 and GST applicable to wooden furniture is a must. Wooden furniture is such an important part of the furniture sector that keeping a tab on the applicable GST rate guarantees compliance and smooth business operations at all times. Whether you are selling pre-made or customized wooden furniture, getting classification right and knowing what exemptions apply can be crucial for efficient GST navigation.

FAQs

1. What is the HSN code for furniture?

HSN code for furniture is 9403 which covers different types of furniture including wooden furnishings.

2. What is the GST rate on wooden furniture under HSN code 9403?

The general GST rate applicable to wooden furniture under HSN code 9403 is 18%.

3. Does the furniture HSN code cover all types of furniture?

Yes, it does as stated in Furniture HSN Code 9403 includes diversity from wood to metal and plastics.

4. Is the GST rate the same for all wooden furniture under the 9403 HSN code?

This means that most of them attract an eighteen per cent Goods and Services Tax charged under heading number (HSN)’s nine thousand four hundred three; however, there could be some specialized types with differing rates in place.

5. How is custom-made wooden furniture classified under the furniture HSN code?

The HSN code for furniture places custom-made wooden furniture under the category. Typically, GST on wooden furniture is 18% similar to other normal furniture, and hence falls within the ambit of HSN Code 9403.

6. Can GST on wooden furniture vary in usage?

Yes, there can be variation in the rate of GST for wooden furniture under HSN code 9403 if it serves specialized purposes like medical or educational use.

7. What documentation is required to sell wooden furniture as per the HSN code?

Sellers should ensure that they add 9403 as an appropriate HSN code for woodwork and meet all applicable requirements tied to GST compliance.

8. Does the 9403 HSN code include outdoor wooden items?

Yes, such garden benches are covered by 9403 HSN Code and usually attract a rate of 18%GST.

9. What are some compliance obligations for firms operating in line with the 9403 HSN code?

There must be proper invoicing containing correct HSN codes, thus invoices must contain authorized codes (including those for woodwork) while businesses must file their returns in good time.

10. How does filing export transactions affect exporters dealing with the furniture HSN code and zero-rated tax situation?

Exporters of woodwork products covered by HSN code number: ‘’9403’’ will pay no taxes upon shipment thereby reducing levels of red tape involved in taxation procedures.

‍