GST on Solar Installations in India: Rates, HSN Codes & Invoicing Guide
Solar installation billing sits at an awkward intersection of goods (panels, inverters, cables) and services (installation, commissioning). Getting the GST treatment wrong — using the wrong HSN code, splitting CGST/SGST incorrectly, or omitting the place of supply — creates real downstream problems: blocked input tax credit for commercial customers, mismatched GSTR filings, and delayed subsidy paperwork for residential ones.
HSN/SAC codes solar EPCs actually use
Solar photovoltaic modules and cells generally fall under specific HSN chapters distinct from general electrical equipment, and installation/commissioning services carry their own SAC code. Using a generic "electrical goods" HSN code on an invoice is one of the most common mistakes small EPCs make, and it is exactly what a GST auditor checks first.
CGST + SGST vs. IGST — getting the split right
Whether an invoice splits tax into CGST + SGST or charges IGST depends on the place of supply relative to the company's registered state — not on where the company's head office happens to be. A company registered in one state installing a system in another state should generally charge IGST, not a CGST/SGST split; getting this backwards is a common and avoidable filing error.
- Always derive tax type from the customer's state of supply and the company's GSTIN — never hardcode it per branch.
- Print the recipient's GSTIN and billing address on every B2B invoice — its absence is the single most common reason a customer's input credit gets rejected.
- Use per-line HSN/SAC codes, not one code for the whole invoice — panels, inverters, cabling, and installation labor are taxed differently.
- Keep a Financial-Year-aware invoice numbering scheme (e.g. INV/25-26/0001) — GSTN return filing expects sequential, FY-scoped numbering.
- Reconcile GSTR-1 B2B and HSN summaries against your invoice ledger monthly, not just at filing deadline.
Solset AI's finance module auto-derives CGST/SGST vs. IGST from the company and customer GSTIN, carries HSN/SAC codes on every line item, and keeps FY-aware sequential numbering — so the compliance work happens automatically instead of being reconstructed by an accountant at filing time.