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Published on:

October 26, 2024

Viraaj Vashishth

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T Shirts HSN Code & GST Rate - 6109

Simply put, the HSN system is a nomenclature of the worldwide importing and exporting trading goods. In India, HSN coding was established in an effort to organize the nation’s GST system and help standardize classification across the nation. Of several codes, the HSN code for t-shirts remains pivotal within the scope of the business of clothing. This paper will take you into the details of t shirt HSN code of 6109, GST rates of these products and some important compliance requirements for businesses.

Understanding HSN Codes

An HSN, or Harmonized System of Nomenclature, is a system in which goods are classified for the purpose of international trade transactions and is recognized as valid worldwide. This helps businesses and governments promote easy trade and apply tariffs to imports and exports at the appropriate levels.

In India, it will be seen that the integration of HSN codes is a matter of necessity for working effectively under the GST framework. Most importantly, the adoption of HSN codes in a business minimizes the risk of under or overcharging tax liabilities as well as claiming input tax credits (ITC) if done in the right context. In most cases, T shirt garments are knitted or crocheted, and thus the HSN code is 6109.

6109 HSN Code

HSN code 6109 is allotted to certain specified types of garments such as the following types of items:

1. Chapter 61: Enumerates knitted or crocheted products that are classified as outerwear clothing or apparel or clothing accessories.

2. HSN Code 6109: This classification is applicable against T-Shirts, singlets, and vests made of knitted stuff or crocheted fabric.

Common Products Under 6109 HSN Code

1. T-Shirts: Knitted fabrics’ T-shirts for males, females, and children.

2. Singlets: Casual or sleepwear as well as a sleeveless undergarment.

3. Vests: It is mainly worn under shirts or as casual clothing.

But while HSN code 6109 is solely and focused on knitted and crocheted items, it has no reference for non-knitted garments which have separate classification.

GST Rates Applicable to HSN 6109

The cost of t-shirts that fall under HSN code 6109 is considered and then decides the tax amount for the GST. The GST regime differentiates between basic and luxurious commodities in goods, thus t-shirts bearing less than ‘one thousand rupees’ are chargeable less than those bearing cost more than ‘one thousand rupees’.

HSN Code	Description	Rate (%)	Effective Date	Rate Revision
6109	T-Shirts, Singlets And Other Vests, Knitted Or Crocheted	5/12	01/07/2017	5% 12%
61091000	Of Cotton	5/12	01/07/2017	5% 12%
610990	Of Other Textile Materials	5/12	01/07/2017	5% 12%
61099010	Of Synthetic Fibers	5/12	01/07/2017	5% 12%
61099020	Of Artificial Fibers	5/12	01/07/2017	5% 12%
61099030	Of Silk	5/12	01/07/2017	5% 12%
61099040	Of Wool Or Fine Animal Hair	5/12	01/07/2017	5% 12%
61099090	Other Textile Materials	5/12	01/07/2017	5% 12%

Table: GST Rates for T-Shirts (HSN Code 6109)

T shirt HSN code and GST rate

1. 5% GST Rate: These are t-shirts affordable and targeting an essential category of clothing being commonly available

2. 12% GST Rate: T shirts costing more than one thousand rupees per piece and are reputed or branded t shirts are covered under this rate.

The reasoning behind the different rates is that clothing fabrics for everyday use should be available at cheaper prices while luxury, or premium wear, should be bought at a higher tax.

Input Tax Credit (ITC) on T-Shirts under HSN 6109

Input Tax Credit (ITC) with respect to t shirt HSN Code and GST rate Since October, 2017 there has been a widespread shift across sectors and industries to modify the current indirect tax structure while minimizing the impact on trade and commerce. . The Input Tax Credit (ITC) applies to taxes paid in purchasing inputs for taxable outputs. Taxes paid in inputs can be offset against the tax on the output sales, hence minimizing the cascading taxation effect.

Any companies dealing in the business of manufacture, retail or wholesale of t-shirts classified as HSN 6109 can utilize the ITC on the tax incurred on raw materials, packaging and other input expenses.

Conditions for Claiming ITC

1. A valid tax invoice of inputs bought must be available in the possession of the business.

2. The goods must only be utilized for the purpose of trade.

3. There has to be an account of all purchases and sales of his business.

If we take this example. Suppose a retailer bought raw materials to make t-shirts the retail tax paid value of the GST on these materials can be claimed as the input tax credit. And this retailer can use this claim to reduce the amount of GST which is applicable on the taxable sale of the t-shirts.

Compliance Demands of Importance with HSN 6109

Under the regulations of GST in India, there are particular restrictions imposed with respect to the usage of HSN codes coupled with the application of GST rates. If this is flouted, sanctions may follow and also difficulties during tax audits.

Key Compliance Points

1. HSN Code Requirement: Businesses exceeding turnover of ₹5 crores are required to mention a 4 digit HSN code in their GST invoices. For businesses with turnover less than ₹5 crores however using the code is optional but is highly recommended.

2. GST Invoicing: Correct mentioning of class of HSN code for t shirts (6109) on invoices further safeguards compliance.

3. GST Rate Application: Tax discrepancies must be avoided by businesses applying the correct GST rate (5% or 12%) depending on the value of the t-shirts.

Impact of Non-Compliance

1. There can be tax audits, penalties, and legal actions taken against individuals due to wrong classifying or misapplying the t-shirt GST rate.

2. It may also have an impact on input tax credits and seamless filing of the GST returns.

Exporting T-Shirts under HSN 6109

The businesses engaged in the export of t-shirts under the HSN 6109 are also under the ambit of favorable provisions as per the GST law. Exports are considered as supplies which are zero-rated which means no gst will be levied on goods exported.

GST on Exported Goods

Zero-rated: T shirts exported do not attract GST.

Refund Mechanism for Exporters

Exporters up to a certain limit can file a claim for the refund of Input Tax Credit due to inputs used in making t-shirts which were exported. This refund may be claimed through the LUT scheme or through payment of IGST and then claiming for a refund.

In the case of a reimbursement claim, appropriate export documents and GST invoices must be filed with the GST portal, accompanied by the conditions requisite to such approvals so as to register the claim of refunds.

Conclusion

Effective classification of knitted or crocheted garments across the board with respect to t shirt HSN code 6109 is important in order to avoid misclassification and possible tax evasion in regards to the GST provisions. Since 5% GST is applicable on the sale of T shirts costing below ₹1000/- and 12% GST on the sale of T shirts costing more than ₹1000/- such businesses know the taxes required and will avoid losses in penalties. The HSN codes used in invoicing and overall use of input tax credits enables businesses to more effectively operate within the GST system.

With continual business activities ranging from local sales to exports, an understanding of the HSN code for t-shirts and current changes in the t-shirt GST rate is important to avoid disruption of the company’s activities as well as abide by the law, the guidelines and the framework. As long as t-shirts are correctly classified, and GST rules followed, t-shirt manufacturers will find their way around the taxation regime and assist in the development of the clothing sector.

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You may also like to read: Refrigerator HSN Code & GST Rate

FAQs

1. What is the HSN Code for t shirts?

The t-shirts come under the head HSN code 6109 which is for T-shirts, singlets, and other vests made of knitted or crocheted fabrics.

2. What are the t shirt HSN codes and their GST rates?

The T-shirts HSN Code is 6109 and the t-shirts HSN rate is 5% for t-shirts up to price of Rs 1000 and 12% for above Rs 1000 t-shirts.

3. What products come under HSN code 6109?

The code HSN 6109 covers T-shirts, singlets and vests, knitted or crocheted fabric garments.

4. What is the correct t-shirt GST rate?

For t-shirts whose selling price is up to Rs 1000, use 5% GST and for those t-shirts with a price above Rs 1000, use 12% GST.

5. Are t-shirts qualifying for HSN code 6109 entitled to ITC under the businesses?

It is possible to claim Input Tax Credit (ITC) for taxes related to the inputs utilized for manufacturing and or selling t-shirts that fall under HSN code 6109, by the firms owing any trade to such products.