Quoting of SAC

[Bharat Cholleti]

Dear sir,

How do we go with quoting of SAC of reimbursement of expenses bill

[Mahadev R]

You could quote the HSN of principle supply ( main goods / service)

[KASTURI SETHI]

Reimbursement of expenes on what account ? Reimbursement itself is not a service. It is an expense and not income. Such expenses may be against supply of goods or services. So there is no specific SAC for reimbursement of expenses. Whether such expenses have been incurred against taxable supply of goods or services ? If the reimbursement of expenses is against taxable supply of service, it will be classifiable under SAC of that service and if such expenses have been incurred against taxable supply of goods, the same will be classifiable under Chapter/Heading/Sub-heading No. of those goods.

In this context, what is crucial is 'the supply of goods or service'.

AI Summary

Classification of reimbursement of expenses: follow the SAC/HSN of the principal supply, not a separate SAC. Reimbursement of expenses is an expense and not a distinct service; there is no specific SAC for reimbursement. If reimbursed costs relate to a taxable supply of services, use the SAC of the principal service; if they relate to taxable goods, classify under the relevant Chapter/Heading/Sub heading (HSN) for those goods. The critical test is the nature of the associated supply of goods or service, and invoice coding should follow the classification of that principal supply.