A practical reference to the jewellery shop HSN code and GST rate for gold, silver, diamond and imitation ornaments, plus how to handle making charges, hallmarking, HUID and old gold exchange on the bill.
A jewellery bill is one of the hardest bills in Indian retail to get right. Most shop counters deal with one HSN code and one rate. A jewellery counter deals with a 3% rate on the ornament, a 5% rate that applies to the karigar and not the customer, an 18% rate on repairs and hallmarking services, a separate rate on loose stones, and a set of BIS fields (purity, net weight, HUID) that have to print on the same invoice.
This guide covers the jewellery shop HSN code and GST rate for each category you actually sell, and then the three places jewellers most often go wrong: making charges, hallmarking, and old gold exchange.
Almost everything a jeweller sells sits in Chapter 71 of the HSN master (natural or cultured pearls, precious stones, precious metals and articles thereof). Services sit under SAC codes instead.
| What you are billing | HSN / SAC | GST rate |
|---|---|---|
| Gold ornaments: chains, bangles, rings, necklaces (plain or stone-studded) | 7113 | 3% |
| Silver ornaments and silver jewellery | 7113 | 3% |
| Platinum jewellery | 7113 | 3% |
| Goldsmiths' and silversmiths' wares: silver pooja items, utensils, idols, gift articles | 7114 | 3% |
| Gold bars, gold coins, bullion | 7108 | 3% |
| Silver bars and unwrought silver | 7106 | 3% |
| Cut and polished diamonds sold loose | 7102 | 1.5% |
| Loose precious and semi-precious stones (ruby, emerald, sapphire) | 7103 | 1.5% |
| Natural or cultured pearls | 7101 | 1.5% |
| Imitation jewellery | 7117 | 3% |
| Jewellery manufacturing job work (karigar billing the jeweller) | SAC 9988 | 5% |
| Hallmarking and purity testing charges | SAC 9983 | 18% |
| Jewellery repair, polishing, re-plating as a standalone service | SAC 9987 | 18% |
Two things to note before you load these into your item master:
This is the single most misunderstood line on a jewellery invoice.
The 5% rate under SAC 9988 is a job work rate. It applies when a karigar or goldsmith does manufacturing work on gold you supply and bills you, the jeweller, for that service. It belongs on the karigar's invoice, where you claim it as input tax credit.
When you sell a finished ornament to a walk-in customer, the metal value and the making charges together are a composite supply. The principal supply is the ornament, so the whole taxable value, including making charges and wastage, is taxed at 3%. You may show making charges as a separate line on the bill for transparency, and customers often ask for exactly that, but that line still carries 3%, not 5%. Charging 5% on the making charges line of a retail sale means you have collected the wrong tax and your GSTR-1 rate-wise summary will not reconcile.
The practical setup in billing software:
BIS hallmarking is mandatory for gold jewellery in notified districts, and the six-character alphanumeric HUID is part of it. The hallmarking requirement is a BIS obligation, separate from GST, but both land on the same printed invoice. A compliant jewellery bill should carry:
Hallmarking charges you recover from the customer are a service at 18% under SAC 9983. Keeping them as their own invoice line, rather than folding them into the metal rate, keeps the 3% and 18% buckets clean in your returns.
When an individual customer sells or exchanges old gold, that person is not making a supply in the course of business, so there is no reverse-charge GST payable by you on the old metal. GST applies on the new ornament at 3%. Whether you can reduce the taxable value by the exchange amount has been read differently by different advance rulings, so take your tax consultant's position and then configure it consistently in your billing software rather than deciding it per bill at the counter.
Two non-GST limits also bite at a jewellery counter: PAN is required for cash sales at or above Rs 2 lakh, and Section 269ST bars receiving Rs 2 lakh or more in cash from one person for one transaction. Build the PAN field into your invoice screen so the counter cannot skip it.
Gold, silver, platinum and imitation ornaments are billed under HSN 7113 (7117 for imitation jewellery) at 3% GST. Loose cut and polished diamonds and loose precious stones fall under HSN 7102 and 7103 at 1.5%. Jewellery job work is SAC 9988 at 5%, and repair or hallmarking services are 18%.
On a retail sale of a finished ornament it is 3%, because the ornament and its making charges form a composite supply whose principal supply is the ornament. The 5% rate applies to job work billed by a karigar to a jeweller, not to the customer's bill.
3%. The ring is an article of jewellery under HSN 7113, and the stone being set into it does not get taxed at its own loose-stone rate. The 1.5% rate only applies when you sell the diamond loose.
HUID is a BIS hallmarking requirement rather than a GST field, but in practice it belongs on the same invoice, along with purity, net metal weight and separately shown stone weight. Any billing software you use for a jewellery shop should let you capture HUID per article.
Four digits if your aggregate turnover in the previous financial year was up to Rs 5 crore, six digits above that. The same code length then has to flow into the HSN-wise summary in Table 12 of GSTR-1.
The only reliable way to keep a jewellery counter compliant is to encode these rates in the item master rather than in the salesperson's memory: 3% ornaments under 7113, 1.5% loose stones, 18% service items for repair and hallmarking, 5% only on the purchase side for karigar job work, and HUID plus purity and net weight as required fields on the invoice template. Rates and hallmarking notifications do change, so confirm the current rate for your items on the CBIC portal or with your tax consultant before you lock the master.
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