New

Team Swipe

December 16, 2025

Blog |

Explore GST

HSN Code for Advertising Services: Guide for Businesses

The SAC/HSN for Advertising Services is 998361, and the GST rate is usually 18%. The one big exception is the sale of ad space in print media, taxed at 5%.

Quick fact: CBIC found that most misclassified invoices came from teams that thought “all ads are 18%” and didn’t check the SAC variation. If you’ve ever second-guessed an invoice line or worried about a mismatch during filing, you’re in the right place. This guide keeps things clean and practical so you get the right code, the right rate, and the right invoice every single time.

The exact SAC/HSN structure for advertising services
GST rates for every ad format (print, digital, TV, radio, outdoor)
Compliance tips to avoid ITC issues and audit surprises

SAC Codes and GST Rates

Here’s the clean snapshot you came for. These SAC codes come straight from CBIC GST classification and cover every major advertising service you’re likely to bill or receive.

SAC	Service	GST Rate
998361	Advertising services (general)	18%
998362	Purchase/sale of ad space or time on commission	18%
998363	Sale of ad space in print media (not on commission)	5%
998364	Sale of TV or radio advertising time	18%
998365	Sale of interest in advertising space	18%
998366	Other ad space or time sales	18%

If you keep these six lines handy, most invoicing decisions fall into place without second-guessing.

What counts as “Advertising Services” Under SAC 998361

SAC 998361 covers the work involved in creating, planning, placing, and running ads across any medium. Think of everything that happens before the media slot is actually purchased: campaign ideas, copy, artwork, creative production, strategy, targeting, and the coordination needed to get an ad live.

Most agency work falls into this bucket. If you handle the message, the creatives, the planning, or the execution, you’re generally under 998361. The only time you step out of this code is when you’re selling the ad space itself or earning commission for arranging it, which CBIC GST classifies separately.

Choosing the right SAC based on your work

Picking the right SAC starts with one question: Are you selling the ad space, or are you providing the advertising service? Once that line is clear, the code usually falls into place. Here’s how different formats break down.

Digital / Internet Ads

(Google, Meta, OTT, SMS, email, banners)

If you sell internet ad space as a publisher or platform, the fit is 998365. This applies when you’re offering impressions, clicks, or inventory directly. The GST rate stays at 18% under CBIC GST classification and matches what platforms list in their tax sheets.

If you’re an agency handling the full workflow strategy, creatives, campaign setup, optimisation, and reporting, you move to 998361. In this case, you’re providing a service rather than inventory, so the rate remains 18%.

Print Media Ads

(Newspaper, magazines)

If you sell print ad space, the code shifts to 998363, taxed at 5%. This single line creates most of the confusion in GST filing since it’s the one major ad format taxed lower.

If you’re an agency doing creative work and coordinating the placement, the usual fit is 998361 at 18%. The only time you’d lean toward the 5% bracket is when you’re treated as the actual seller of the print space rather than a service provider.

TV/Radio + Outdoor + Other Media

TV or radio time sale falls under 998364 at 18%

Hoardings, billboards, transit ads, cinema slides, or any other physical or digital space sale outside print use 998366, also at 18% under CBIC GST.

Advertising through agencies: Principal vs Agent

How you bill ads depends on whether you act as a principal or an agent. This single distinction changes the SAC code, GST rate, and how your invoice should look.

Principle Model

Here, the agency buys ad space in its own name and then resells it to the client. You’re treated as the seller of the space, not just a service provider.

So the GST rate follows the medium:

5% for print (998363)
18% for all other space/time (998364 / 998365 / 998366)

‍

A quick example:

If you buy ₹50,000 of newspaper space and resell it for ₹60,000, GST is 5% on ₹60,000, since you’re the one selling the space.

Agent Model

In this setup, the agency doesn’t own the space. You buy it on behalf of the client, pass it through at actuals, and charge a separate fee.

The pass-through space retains its usual rate (5% for print, 18% for other media). Your commission or service fee is taxed at 18% under 998362 (commission) or 998361 (service).

Example:

If the media house charges ₹50,000 and your fee is ₹8,000, GST applies as:

5% or 18% on ₹50,000 (based on medium)
18% on ₹8,000 (your fee)

Composite or bundled advertising deals

Mixed ad deals can shift your GST rate without you realising it. If print ad space (normally 5%) is bundled with design, artwork, creative, or campaign execution, authorities may classify the whole thing as an advertising service. That pushes the rate to 18%, based on past advance ruling views shared on platforms.

This usually happens when everything is billed as one supply rather than two separate activities.

A simple way to keep things clean:

If you want the 5% rate for print space to apply, split the billing.

One invoice for print space at 5%, and another for creative or agency work at 18%.

Ads bought from foreign platforms

If you buy ads from a non-resident provider, Google, Meta, a global DSP, or any overseas platform, GST doesn’t disappear just because the vendor has no GSTIN. Under reverse charge, you pay the tax. This comes straight from guidance shared by the Goods and Services Tax Council and explained clearly on platforms

Here’s how the workflow plays out in real life:

Create a self-invoice for the value of the ad service.
Pay IGST in cash through your GST portal.
Claim ITC in the same period if you’re eligible, which neutralizes the cash outflow.

If you handle international ad spends often, keeping this routine tight prevents mismatches during filing and saves you from fixing unexpected portal errors at month-end.

Invoicing + Compliance checklist

A solid invoice keeps your filings smooth and your ITC clean. Here’s a quick checklist you can keep pinned to your desk so nothing slips through.

Pick the right SAC based on whether you’re selling space or delivering an advertising service.
Show the GST rate clearly, especially when mixing 5% print space with 18% creative or agency work.
Use a 6-digit SAC if your turnover is above ₹5 crore; a 4-digit code works below that, through the 6-digit format is safer and preferred by tools.
Keep contracts, insertion orders, and media bills organized so you can trace every charge.
Reconcile ITC claims each month to avoid mismatch notices or delayed credits.

Common mistakes Businesses make

Even experienced teams slip up on ad-related GST. These are the usual trouble spots:

Using 998361 for a plain print space sale that should be under 998363 (5%).
Charging 5% on a bundled print + creative deal that should fall under 18% as a single advertising service.
Forgetting the reverse charge on ads bought from foreign platforms.
Mixing commission amounts into the space value distorts GST rates and SAC classification.

Conclusion

You now have the SAC codes, rate rules, and quick checks that keep ad an invoice clean. Here’s a tight set of takeaways you can use the moment you open your billing tool.

Pick the SAC based on the actual work you deliver, creative under 998361, space sales under the 99836x codes, and commission under 998362 for clean rate mapping.
Keep print space separate from creative if you want the 5% rate to stand on its own, and avoid bundling that pushes everything to 18%.
Treat foreign ads as RCM spends: self-invoice, pay IGST in cash, and pull ITC when eligible to keep your monthly filings smooth.
Use a 6-digit SAC for accurate classification, and keep insertion orders and bills handy to prevent ITC mismatches later.

If billing mistakes or mismatched SAC codes slow your workflow. Swipe steps in as the easier way to keep invoices sharp and GST ready, exactly what this guide helped you prepare for.

FAQs

Is SAC 998361 the same for all advertising?

No. 998361 covers the creative, planning, and execution side of advertising. The sale of ad space or time has its own codes, such as 998363, 998364, 998365, and 998366 under CBIC GST rules.

Why is print media taxed at 5%?

CBIC gave newspapers and magazines a concessional 5% rate to keep print advertising affordable. This applies only to the sales of space, not the creative or service portion.

What does SAC apply to influencer marketing or brand promotions?

Most influencer and brand-collab work fits into 998361 because it’s treated as an advertising service. If the engagement is closer to sponsorship, it may slide into 998367 under CBIC GST classification.

Can you claim ITC on advertising GST?

Yes, if the speed supports your business. Finance platforms highlight that ad-related ITC is commonly claimed for campaigns tied to sales, marketing, or brand growth.

Featured Posts

GST 5 Per cent Items List for Daily Use Products

Chapter 95: GST Rate and HSN Code for Toys, and Sports goods

Amendment to Section 43B: The Impact on Taxpayers and Small Businesses

GST Audit: Types, Objective and Applicability

CGST Rule 86B: Understanding the Restriction on Using Amount in Electronic Credit Ledger

SEBI Website Compliance: A Comprehensive Guide for Stock Brokers

Understanding Section 24 of the Income Tax Act

Rubber and Articles Thereof: Understanding GST Rates and HSN Code (Chapter 40)

Featured Posts

You might also like

Understanding Rashtriya Vayoshri Yojana and Its Benefits

The Ultimate Checklist for Filing GSTR-9, GSTR-9A, and GSTR-9C

ICAI Introduces New Balance Sheet Format for FY 2024–25: What You Need to Know