Air Conditioner HSN Code 8415 and GST Rates

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.

GST Rates & Exemptions for HSN Code 8415

Under the 56th GST Council reforms (effective 22 September 2025), the GST rate on air conditioners (HSN Code 8415) has been revised from 28% to 18%.This move aims to reflect air conditioners as a standard appliance rather than a luxury good, aligning them with other electrical products under Chapter 84 of the GST schedule.​

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.​

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

1. Retail Sale: All air conditioners—split, inverter, or window models—under HSN 8415 attract 18% GST whether sold online or offline.
2. B2B Sale: A hotel purchasing 20 inverter ACs can claim ITC for business use.
3. Composite Supply: If the dealer adds installation and piping charges to the same bill, 18% GST applies on the total invoice value.
4. Separate Services: When installation is billed separately by a service contractor, that invoice also attracts 18% GST.

Common Mistakes in Air Conditioner GST Filing

• Applying incorrect HSN codes for parts or accessories (e.g., compressors under 8414 instead of 841590).
• Failing to mention “composite supply” when installation is bundled.
• Wrongly claiming ITC for residential ACs or non-business expenses.
• Mismatch between supplier’s invoices and GSTR-2B during ITC reconciliation.

Conclusion

The air conditioner HSN code 8415 now falls under India’s standard 18% GST rate, effective from September 2025, aligning air conditioners with other electrical products.This reclassification simplifies compliance, reduces consumer cost by 10%, and allows businesses to efficiently claim Input Tax Credit (ITC) for official use.Proper use of HSN 8415 in billing, along with accurate ITC documentation, ensures error-free filing and smooth audits in the upcoming GST 2.0 regime.​

Also explore

• Contract HSN Code 9954
• 3006 HSN Code and GST Rates
• 9987 HSN Code and GST rate
• Service Charge HSN Code 9983

FAQs: Air Conditioner HSN Code 8415 & GST

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.