Previously, non-lithium batteries were at 28%, but as of September 2025, all batteries under heading 8507, including lead-acid inverter batteries and lithium-ion, and HSN 8506 are taxed at 18%. Inverters & UPS, which are classified under "Static Converters" (HSN 8504), also carry a standard 18% GST rate, while solar equipment or devices attract a concessional rate of 5% or 12%, based on their type.
Battery HSN code and GST rate
The table below outlines the HSN classification for batteries under heading 8507, including key sub-categories based on battery type, such as lead-acid, lithium-ion and nickel-based accumulators, along with their applicable GST rates.
|
Category |
HSN Code / Number |
Description |
GST Rate |
|
Batteries |
8507 |
Electric accumulators, including separators, for storing electrical energy, such as lead-acid, lithium-ion and nickel-cadmium batteries. These batteries (commonly used for vehicles and inverters) |
18% |
|
Lead-acid batteries |
8507 10 00 |
Used for starting piston engines (automotive) |
18% |
|
Other lead-acid accumulators |
8507 20 00 |
Electric accumulators, including separators, whether or not rectangular (including square), other than lead-acid accumulators for starting piston engines. Usually used in Solar power systems, UPS, telecommunications and industrial electric vehicles. |
18% |
|
Nickel-cadmium accumulators |
8507 30 00 |
Nickel-cadmium electric accumulators (batteries), including their separators, regardless of shape (rectangular or square) |
18% |
|
Nickel-metal hydride (NiMH) accumulators |
8507 50 00 |
Nickel-metal hydride (NiMH) accumulators (rechargeable batteries), excluding spent batteries |
18% |
|
Lithium-ion batteries (accumulators) |
8507 60 00 |
Lithium-ion accumulators (batteries), including those for electric vehicles, tools, and electronics. Commonly used in electric vehicles (EVs), laptops, mobile phones and power storage systems |
18% |
|
Other Electric Accumulators |
8507 80 00 |
Other electric accumulators (excluding lead-acid, nickel-cadmium, nickel-iron, nickel-metal hydride and lithium-ion batteries), including separators, whether or not rectangular. Common applications: Rechargeable batteries for various electronic devices, E-rickshaw batteries. |
18% |
Inverter & UPS HSN code with GST rate
Since inverters and UPS systems are designed for power conversion rather than energy storage, they are classified under HSN 8504 as static converters, separate from batteries (HSN 8507). The table below outlines the classification and sub-classification within HSN 8504, covering inverters, UPS systems and related power conversion equipment.
|
Category |
HSN Code / Number |
Description |
GST Rate |
|
Electrical transformers, static converters and inductors |
8504 |
Covers electrical transformers, static converters (e.g., rectifiers, inverters)and inductors. It applies to various power management devices, including voltage stabilisers, battery chargers and ballast for lamps, with many components categorised by their power-handling |
18% |
|
Static converters (including inverters, rectifiers and battery chargers) |
8504 40 |
Common items include electric inverters, voltage stabilisers and AC/DC power adapters |
18% |
|
Electric inverters |
8504 40 10 |
It applies to solar inverters, home inverters and UPS systems |
18% |
|
Other Static Converters |
8504 40 90 |
Includes devices like rectifiers, inverters, and certain UPS units. |
18% |
|
Battery chargers |
8504 40 30 |
Battery Chargers (static converters/rectifiers), which are commonly used for mobile, laptop and other battery charging devices |
18% |
Solar panel HSN code and GST rate
Solar equipment is classified across multiple HSN codes based on the specific component, system, or end-use application, ranging from photovoltaic cells and modules to solar-powered appliances and complete power systems. GST rates vary accordingly, with concessional rates applied to most solar components to support renewable energy adoption.
|
Product |
HSN Code / Number |
Description |
GST Rate |
|
Diodes, transistors, photosensitive semiconductor devices |
8541 |
Diodes, transistors, photosensitive semiconductor devices (including photovoltaic cells/solar panels), light-emitting diodes (LED) and mounted piezoelectric crystals. It is widely used for electronic components and solar energy equipment |
5% (for solar items) |
|
Solar panels (photovoltaic cells/modules) |
8541 40 11 |
Covers solar cells, whether or not assembled in modules or made up into panels. Common applications include solar panels, photovoltaic modules, solar lighting systems, solar power generating systems |
5% |
|
Solar cells (assembled in modules or made up into panels) |
8541 40 12 |
It specifically applies to photovoltaic cells connected together and/or framed to generate electricity, distinguishing them from unassembled cells. Most common use is in solar PV panels/modules |
5% |
|
Photovoltaic cells (assembled in modules or made up into panels) |
8541 43 00 |
Commonly used in solar energy systems, solar panels and renewable energy equipment. |
5% |
|
Solar water heater |
8419 12 |
Non-electric, solar-powered appliances used for heating water |
5% |
|
Solar inverter |
8504 |
Solar inverters used for power conversion |
5% |
|
Solar lantern / solar lamp |
9405 50 40 |
Solar lanterns or lamps are often classified specifically as non-electrical lamps and lighting fittings |
5% |
|
Solar power plant (composite supply) |
9954, 9983, 9987 |
Combined supply of goods and construction/installation services (composite contracts involving construction) |
70% value taxed at 5% + 30% value taxed at 18% |
What common mistakes should you avoid in Battery HSN Classification
Despite clear GST guidelines, businesses often make classification errors that can lead to incorrect tax application and compliance issues. Some of the most common mistakes include:
- Treating inverters as batteries: Inverters fall under a different HSN code (8504), while batteries are classified under 8507. Mixing the two can result in incorrect GST rates.
- Using generic HSN codes instead of specific 8-digit codes: Businesses sometimes use broad 4-digit codes, which may not accurately represent the product and can create issues in reporting and audits.
- Applying the wrong GST rate (18% vs 28%): Different battery types attract different GST rates. Applying a uniform rate without checking the classification can lead to overpayment or penalties.
- Misclassifying lithium batteries as lead-acid batteries: Since lithium-ion batteries generally attract a lower GST rate, incorrect classification can directly impact tax liability and compliance.
Conclusion
With the standardisation of battery GST rates at 18% and concessional rates for solar components, businesses now have clearer guidelines– but only if classifications are applied correctly. Even small errors, such as confusing batteries with static converters or using broad HSN codes, can lead to incorrect tax filings, penalties or missed input tax credit benefits.
With TallyPrime, businesses dealing with batteries, inverters, UPS and solar-powered devices can automatically assign correct HSN codes, apply accurate GST rates, generate GST-ready invoices and e-way bills, while ensuring error-free compliance and reporting.
