GST on Architect Services: GST Rate and SAC Code

Architectural services are an essential part of the construction and infrastructure industry, involving design, planning, and supervision of buildings and structures. Under the Goods and Services Tax (GST) regime, architectural services are categorized as taxable services and attract GST at a specific rate. Understanding the GST rate, SAC codes, input tax credit (ITC), and compliance requirements is crucial for architects and architectural firms.

This article provides a detailed guide on GST applicability for architect services, the GST rate, relevant SAC codes, registration requirements, and compliance obligations.

GST Applicability on Architect Services

Under the GST Act, architectural services are classified under professional and technical services, and they attract GST. These services include:

Architectural design and consultancy.
Structural planning and engineering services
Site planning and supervision.
Urban and landscape architecture services.
Project feasibility studies.

GST Rate on Architect Services

As per the GST Act, architectural services attract 18% GST.

CGST: 9%
SGST: 9%
IGST (for interstate supply): 18%

SAC Code for Architect Services

SAC Code Details for Architect Services

SAC Code	Service Description	GST Rate
998321	Architectural Services (Building Design, Planning, and Consultancy)	18%
998322	Landscape Architectural Services	18%
998323	Urban Planning and Design Services	18%
998329	Other Architectural and Engineering Services	18%

Architects must mention the correct SAC code in invoices to ensure GST compliance.

GST Registration for Architects and Firms

Who Needs to Register for GST?

Architects and architectural firms must register for GST if:

Their annual turnover exceeds ₹20 lakh (₹10 lakh for special category states).
They provide services to GST-registered businesses that require GST-compliant invoices.
They engage in interstate supply of services, in which case GST registration is mandatory, irrespective of turnover.
They provide export services (overseas architectural projects) and want to claim GST refunds.

Documents Required for GST Registration

PAN Card of the individual or firm
Aadhaar Card of the proprietor/partners
Business Address Proof
Bank Account Details
Professional Tax Registration Certificate (if applicable)

GST Compliance and Filing Requirements for Architects

1. Issuing GST-Compliant Invoices

Architects and firms must issue a GST invoice with:

GSTIN of both supplier and recipient
Invoice number and date
Service description and SAC Code
GST rate (18%) and total taxable amount
IGST, CGST, and SGST details (as applicable)

2. Filing GST Returns

GSTR-1: Monthly or quarterly return for outward supplies (invoices issued).
GSTR-3B: Monthly return summarizing GST liability.
GSTR-9: Annual GST return (for those with turnover above ₹2 crore).

Failure to file GST returns on time may attract late fees and penalties.

Input Tax Credit (ITC) for Architects

Architects and firms can claim Input Tax Credit (ITC) on GST paid for:

✔ Office rent and utilities

✔ Professional software (AutoCAD, Revit, SketchUp, etc.)

✔ Office furniture and IT equipment

✔ Marketing and promotional expenses

✔ Business travel and networking events

However, ITC cannot be claimed on personal expenses or services used for exempt supplies.

GST on Export of Architect Services

If an architect provides services to an overseas client, the service qualifies as an export of services, which is zero-rated under GST. However, to avail GST exemption or refund, the architect must:

Issue a proper invoice mentioning “Export of Services.”
Receive payment in convertible foreign exchange or INR through RBI-approved channels.
File Letter of Undertaking (LUT) with the GST department to supply services without charging GST.

Reverse Charge Mechanism (RCM) on Architect Services

Reverse Charge Mechanism (RCM) applies if an unregistered architect provides services to a GST-registered business. In such cases:

The recipient of the service (business client) must pay GST under RCM.
The architect does not need GST registration if turnover is below the threshold.

Penalties for Non-Compliance with GST on Architect Services

Late GST return filing: ₹50 per day (₹20 per day for nil returns).
Failure to register for GST: 10% of the tax due or ₹10,000 (whichever is higher).
Wrong SAC code usage: May lead to notices and audits.
Failure to issue a GST invoice: Fine of ₹25,000 per incorrect invoice.

Proper GST compliance helps avoid penalties and ensures smooth business operations.

Benefits of GST Compliance for Architects

✔ Legal compliance – Avoids penalties and legal disputes.

✔ Enhanced credibility – GST-registered firms gain trust from corporate and international clients.

✔ Eligible for Input Tax Credit (ITC) – Reduces costs on business expenses.

✔ Seamless business expansion – Enables interstate and international transactions.

✔ Eligibility for government tenders – Many government contracts require GST registration.

Conclusion

GST is an integral part of architectural services in India, and compliance is necessary for smooth business operations. Architects and architectural firms must charge 18% GST, use correct SAC codes, and file GST returns on time to avoid penalties. Those providing export services can benefit from zero-rated GST and claim refunds.