Air Conditioner HSN Code 8415 and GST Rates
Air conditioners are classified under HSN Code 8415 under the GST system. Businesses selling, purchasing or installing air-conditioning machines need to use the correct HSN classification while generating GST invoices.
Whether it is a split AC, window AC, inverter AC or commercial HVAC system, selecting the correct HSN code helps businesses apply the correct GST rate and maintain accurate tax records.
This guide explains Air Conditioner HSN Code 8415, GST rates, AC category-wise classification, invoice requirements, installation GST treatment and common GST mistakes businesses should avoid.
What is HSN Code 8415?
The air conditioner HSN code (HSN Code 8415) includes all machines that incorporate a motor-driven fan and elements for temperature and humidity control. This classification applies to split ACs, window ACs, central systems, vehicle air conditioners, and heat pumps used for cooling or heating indoor spaces.
The GST classification under 8415 HSN code helps determine tax rates, input credit availability, and accurate filing of GST returns for both manufacturers and dealers dealing in air-conditioning products.
HSN Code 8415 falls under Chapter 84 of the HSN classification system, which covers machinery and mechanical appliances.
It includes:
- Split air conditioners
- Window air conditioners
- Inverter AC systems
- Commercial air-conditioning units
- Central air-conditioning systems
- Other temperature and humidity control machines
The exact HSN classification depends on the type and technical specifications of the air-conditioning system.
Latest GST Rate on Air Conditioners Under HSN Code 8415
Air conditioners classified under HSN Code 8415 attract 18% GST.
The applicable tax structure is:
Businesses should apply the correct GST rate while generating invoices to avoid tax calculation errors and reconciliation issues.
Air Conditioner HSN Code 8415 & GST Rate (2026)
Short Answer: Air conditioners are classified under HSN Code 8415 and attract 18% GST. The rate was reduced from 28% to 18% following the GST Council's September 2025 decision. Businesses purchasing ACs for commercial use can generally claim Input Tax Credit (ITC) subject to GST provisions.
Key Highlights:
- Current GST rate: 18% on all types of air conditioners under HSN 8415.
- Previous GST rate: 28% (before September 2025).
- No GST exemptions apply – air conditioners remain fully taxable for both residential and commercial buyers.
- Input Tax Credit (ITC): Available for business purchases used for commercial operations.
Table Notes
- The GST rate applies equally to all AC types (split, window, cassette, VRF, inverter systems, etc.).
- Only installation services billed separately may attract 18% GST, treated as a composite supply under GST law.
- Spare parts and accessories of ACs are classified under corresponding sub-headings of HSN 8415 and attract the same rate.
GST Rates Applicable Under 8415
(Rates applicable after GST Council decision, 22 September 2025.).
What’s Included Under HSN 8415 Category?
Under Chapter 84, HSN Code 8415 covers a broad range of air-conditioning products and components, including:
- Window-mounted and wall-type split systems.
- Inverter and energy-efficient air conditioners.
- Car, bus, and truck air-conditioning systems.
- Central air-conditioning and HVAC systems.
- Heat pumps (cooling and heating dual-use appliances).
- Commercial and industrial air chillers or pack units.
Any installation, composite supply, or maintenance service related to these machines is included when billed along with the product sale.
Explore Gimbooks HSN/SAC code & GST Rate finder
Key Exemptions Under GST for Air Conditioners
There are no exemptions or concessional GST rates for air conditioners under HSN 8415.However:
- Residential consumers purchasing ACs indirectly bear the 18% tax as part of the MRP.
- Businesses using air conditioners for commercial operations (e.g., hotels, offices, or retail stores) can claim full ITC on the GST charged.
Products once classified as luxury under the earlier 28% slab now fall into India’s standard 18% GST bracket, simplifying the rate structure.
GST Rate Change: Old vs Current GST Rate on Air Conditioners
Many businesses still search for the previous GST slab applicable to air conditioners.
Example of GST Savings
Suppose an air conditioner has a taxable value of ₹50,000.
Consumer Savings: ₹5,000 per unit due to the GST reduction.
Complete HSN Code List for Air Conditioners and Parts
The following HSN codes are commonly used for GST billing and e-invoicing of air conditioners and related equipment.
Before issuing invoices, businesses should verify the latest classification because the applicable code may vary based on product specifications and installation type.
Input Tax Credit (ITC) Rules for ACs (HSN Code 8415)
Businesses purchasing air conditioners for office or industrial use are eligible to claim Input Tax Credit (ITC) under Section 16 of the CGST Act.
ITC Eligibility
- ITC can be claimed when the AC is:
- Used directly or indirectly in business operations.
- Installed in commercial buildings such as offices, retail stores, restaurants, or factories.
- Accompanied by a valid tax invoice containing the supplier’s GSTIN and description under HSN Code 8415.
- Invoices must appear in the GSTR-2B statement for ITC reconciliation.
ITC Restrictions
- ITC cannot be claimed for ACs installed in personal residences or used for non-business activities.
- Centralized or fixed building installations mixing with immovable property may face ITC limitations under Section 17(5).
- Partial ITC reversal may apply when ACs are used for both taxable and exempt supplies.
Example:
If an office installs 10 split ACs worth ₹5,00,000 with 18% GST (₹90,000), the business may claim ₹90,000 as input credit while filing GSTR-3B, provided all ACs are used for official operations.
GST on Air Conditioner Billing: Practical Scenarios
- Retail Sale: All air conditioners—split, inverter, or window models—under HSN 8415 attract 18% GST whether sold online or offline.
- B2B Sale: A hotel purchasing 20 inverter ACs can claim ITC for business use.
- Composite Supply: If the dealer adds installation and piping charges to the same bill, 18% GST applies on the total invoice value.
- Separate Services: When installation is billed separately by a service contractor, that invoice also attracts 18% GST.
Common GST Billing Mistakes for Air Conditioner Dealers
Using Incorrect HSN Code
Different AC systems and parts may have different classifications. Using incorrect HSN codes can create compliance issues.
Applying Wrong GST Rate
Businesses should ensure the latest applicable GST rate is used while generating invoices.
Incorrect Installation Treatment
Installation charges should be recorded correctly depending on whether they are supplied separately or with the AC.
Missing HSN Details
Invoices without proper HSN information may create reconciliation problems.
Incorrect ITC Claims
Businesses should verify whether AC purchases qualify for Input Tax Credit.
Conclusion
Air Conditioner HSN Code 8415 plays an important role in GST compliance for businesses dealing with air-conditioning products.
Businesses should correctly identify the applicable HSN classification, apply the correct GST rate, maintain proper invoice details and understand GST treatment for installation services.
Using GST-enabled billing software can help businesses manage HSN codes, tax calculations and invoice compliance more efficiently.
Also explore
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- 3006 HSN Code and GST Rates
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- Service Charge HSN Code 9983
FAQs
What is HSN 8415?
HSN Code 8415 refers to all types of air conditioners, including window, split, cassette, and central cooling systems that control both temperature and humidity.
What’s the GST rate for air conditioners under 8415?
The GST rate is 18% on all ACs as per the 56th GST Council update (22 September 2025).
Can ITC be claimed on air conditioner purchases?
Yes, businesses can claim ITC on ACs installed for commercial use, provided invoices are GST-compliant.
Are residential air conditioners exempt from GST?
No, household air conditioners are fully taxable under the 18% rate without exemptions.
Is GST applicable on installation charges for ACs?
Yes, GST at 18% applies to installation and service charges, whether billed separately or as part of a composite supply.
What is the HSN code for split AC?
Split air conditioners are generally classified under HSN Code 84151090 or 84158210 depending on system configuration and refrigerating unit specifications.
What is the GST rate on inverter air conditioners?
Inverter air conditioners attract 18% GST under HSN Code 8415, similar to conventional air conditioners.
Is compensation cess applicable on air conditioners?
No. Air conditioners attract GST but do not currently attract compensation cess.
What is the HSN code for AC spare parts?
Most air conditioner parts and accessories fall under HSN Code 84159000, though certain standalone components may have separate classifications.
Can a hotel claim ITC on air conditioners?
Yes. Hotels, offices, retail stores, factories, and other commercial establishments can generally claim ITC on air conditioners used for business purposes subject to GST provisions.