HSN Code and GST Rate on Laundry Services:
Laundry services, including dry cleaning and garment care, fall under the Goods and Services Tax (GST) regime in India. Businesses offering laundry services must comply with GST rules, including applicable tax rates, HSN codes, and invoicing requirements.
This guide provides a comprehensive overview of GST on laundry services, including tax rates, HSN codes, compliance measures, and input tax credit (ITC) eligibility.
What are Laundry Services Under GST?
Laundry services involve cleaning, ironing, dry cleaning, and related services for garments, fabrics, and household textiles. These services are taxable under GST and are categorized under professional services.
Types of Laundry Services Covered Under GST
✔ Regular washing and ironing services
✔ Dry cleaning of garments and upholstery
✔ Carpet and curtain cleaning services
✔ Shoe and leather cleaning services
✔ Laundry services for hotels, hospitals, and institutions
✔ Self-service laundromats (if assisted by staff)
GST Rate on Laundry Services in India
The GST rate applicable to laundry services depends on the type of service provided:
| Type of Laundry Service | GST Rate | HSN Code |
|---|---|---|
| Regular Laundry & Ironing Services | 18% | 999712 |
| Dry Cleaning of Clothes, Upholstery, and Household Items | 18% | 999712 |
| Carpet, Curtain, and Sofa Cleaning Services | 18% | 999712 |
| Shoe, Leather, and Specialized Fabric Cleaning | 18% | 999712 |
| Laundry Services Provided to Hotels (Bundled with Accommodation) | 5% or 18% (Depends on Hotel GST Rate) | 999712 |
| Self-Service Laundromats (Unmanned) | Exempt from GST | – |
✔ If a laundromat provides assistance (staffed service), GST applies. ✔ For laundry services included in hotel packages, GST rate depends on room tariff.
HSN Code for Laundry Services
Under GST, Service Accounting Codes (SAC) classify services for taxation. Laundry and dry cleaning services fall under:
| HSN Code | Service Description | GST Rate |
| 999712 | Laundry, dry cleaning, and pressing services | 18% |
| 999799 | Other cleaning services (carpets, curtains, upholstery) | 18% |
✔ Businesses must mention HSN codes in GST invoices for proper tax classification.
GST Registration for Laundry Service Providers
Laundry service businesses must register for GST if:
- Their annual turnover exceeds ₹20 lakh (₹10 lakh for special category states).
- They provide services to GST-registered businesses (B2B transactions requiring GST invoices).
- They engage in interstate service supply, making GST registration mandatory.
Documents Required for GST Registration
✔ Business PAN Card
✔ Aadhaar Card of the proprietor/partners
✔ Business Address Proof
✔ Bank Account Details
✔ Trade License (if applicable)
✔ Rental Agreement (for rented premises)
GST Compliance and Invoicing for Laundry Businesses
1. Issuing GST-Compliant Invoices
Laundry service providers must issue a GST invoice containing: ✔ Business Name, GSTIN, and Address
✔ Invoice Number and Date
✔ Customer’s Name and GSTIN (if applicable)
✔ HSN Code (999712) and GST Rate (18%)
✔ Breakdown of Tax Components (CGST, SGST, IGST)
✔ Total Amount Payable (with and without GST)
2. Filing GST Returns for Laundry Businesses
- GSTR-1: Monthly/quarterly return for outward supplies.
- GSTR-3B: Monthly summary return for GST liability.
- GSTR-9: Annual GST return (for businesses with turnover above ₹2 crore).
✔ Timely GST filing avoids penalties and legal issues.
Input Tax Credit (ITC) for Laundry Businesses
Laundry service providers can claim Input Tax Credit (ITC) on: ✔ GST paid on purchase of detergents, cleaning chemicals, and machinery.
✔ Rent, electricity, and maintenance of laundry facilities.
✔ GST paid on advertising and marketing expenses.
✔ ITC on transportation costs for pickup/delivery services.
Blocked ITC (Not Allowed)
❌ GST paid on services for personal consumption.
❌ ITC on capital goods used exclusively for exempt services (e.g., unmanned laundromats).
✔ Businesses opting for the Composition Scheme cannot claim ITC.
GST on Laundry Services for Hotels & Institutions
Laundry services provided to hotels, hospitals, and corporate clients have special GST considerations: ✔ If laundry services are bundled with hotel accommodation, GST follows the hotel’s GST rate (5% or 18%).
✔ If billed separately, GST is 18% under SAC 999712.
✔ Institutions (hospitals, hostels) must verify ITC eligibility before availing services.
Penalties for Non-Compliance in Laundry Services
| Non-Compliance | Penalty |
| Late GST Return Filing | ₹50 per day (₹20 for Nil returns) |
| Failure to Register for GST | 10% of tax due or ₹10,000 (whichever is higher) |
| Incorrect HSN Code Usage | Legal scrutiny and additional tax demand |
| Failure to Issue GST Invoice | ₹25,000 per incorrect invoice |
✔ Timely GST compliance prevents penalties and legal complications.
1. Is GST applicable on laundry services in India?
Yes, GST at 18% applies to laundry, dry cleaning, and fabric care services.
2. Can a laundromat be exempt from GST?
Yes, self-service laundromats without staff assistance are exempt from GST.
3. Can laundry businesses claim Input Tax Credit (ITC)?
Yes, ITC can be claimed on cleaning materials, machinery, electricity, and other business expenses.
4. What is the HSN code for laundry services?
Laundry services fall under HSN Code 999712, taxed at 18% GST.
5. What happens if I don’t register for GST?
Non-registration may lead to penalties, legal action, and loss of ITC claims.
Conclusion
Understanding GST rates and HSN codes for laundry services is essential for compliance and smooth business operations. Laundry service providers must charge 18% GST, use the correct HSN code, issue proper invoices, and file GST returns on time to avoid penalties.
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