Looking for expert help with GST and income tax for attar and perfume makers India? The team at Tax Garden, based in Kondapur, Hyderabad, helps Indian SMEs stay compliant. End-to-end filings, notices, and deadline tracking, all in one place.
Key Takeaways
- Attar in a fixed oil base (HSN 3301) and perfume or toilet water (HSN 3303) are both 18% GST from 22 September 2025 (Notification 9/2025-Central Tax (Rate), Schedule II, S. Nos. 58 and 60).
- Natural mint oils (peppermint, spearmint, Mentha piperita, DMO, DTMO) are 5% (Schedule I, S. No. 224). Synthetic versions are 18%.
- Buy mint oil from an unregistered distiller and you, the registered buyer, pay the GST under reverse charge (Notification 4/2017-Central Tax (Rate), S. No. 3A).
- Fresh rose, jasmine and other flowers are nil-rated, so there's no credit on your main raw material but no tax on it either.
- Small makers can declare 6% or 8% of turnover as profit under Section 44AD for AY 2026-27. A belated AY 2026-27 return can still be filed by 31 December 2026.
What is the GST rate on attar? Attar is taxed at 18% GST, 9% CGST plus 9% SGST, from 22 September 2025. Heading 3301 covers essential oils and "attars of all kinds in fixed oil bases" and sits at S. No. 58 of Schedule II to Notification 9/2025-Central Tax (Rate). Alcohol-based perfume (heading 3303) is also 18%.
A Kannauj deg-bhapka unit, a mentha oil trader in Barabanki and an attar counter near Charminar all sell scent, but they don't sit in the same GST entry. One sells an 18% product made from nil-rated flowers. Another deals in a 5% oil that's often bought from farmers who aren't registered, which brings reverse charge into play. This guide is for attar makers, perfume blenders, essential oil distillers and traders, and the Chartered Accountants (CAs) who file for them. Goods and Services Tax (GST) rates are as in force from 22 September 2025. Income tax is for FY 2025-26 (AY 2026-27) under the Income-tax Act 1961, with the 2025 Act section numbers that apply from 1 April 2026.
Attar and perfume HSN codes: what's 18% and what's 5%?
Almost everything you sell is 18%. The one big exception is natural mint oil, and the line between natural and synthetic decides the rate.
Comparison
GST on Attar, Perfume and Essential Oils from 22 September 2025
| Item (HSN) | GST | Notification entry |
|---|---|---|
| Essential oils, concretes, absolutes, aqueous distillates of essential oils, attars of all kinds in fixed oil bases (3301) | 18% | 9/2025-CT(R), Schedule II, S. No. 58 |
| Perfume compounds and mixtures of odoriferous substances used as industrial raw material (3302) | 18% | 9/2025-CT(R), Schedule II, S. No. 59 |
| Perfumes and toilet waters (3303) | 18% | 9/2025-CT(R), Schedule II, S. No. 60 |
| Deodorants, room deodorisers and other perfumery preparations (3307) | 18% | 9/2025-CT(R), Schedule II, S. No. 64 |
| Menthol, mentha oil, DMO, DTMO, spearmint and Mentha piperita oil from natural menthol (2906 11 10, 30, 3301) | 5% | 9/2025-CT(R), Schedule I, S. No. 224 |
| The same goods made from other than natural menthol | 18% | 9/2025-CT(R), Schedule II, S. No. 38 |
| Agarbatti, dhoop, lobhan, sambraani (3307 41 00) | 5% | 9/2025-CT(R), Schedule I, S. No. 250 |
Source: Notification 9/2025-Central Tax (Rate) dated 17 September 2025, in force from 22 September 2025. No later amendment to these entries found up to Notification 10/2026-Central Tax (Rate). IGST at double the CGST rate under the matching Integrated Tax (Rate) notification.
Oil-based or alcohol-based, it's still 18%. A traditional attar distilled into sandalwood oil sits in heading 3301 by name. A spray perfume in an alcohol base is heading 3303. The tariff heading changes; the rate doesn't. Describe the product on your invoice the way the notification does ("attar in fixed oil base", "perfume"), with the 4-digit HSN code.
Selling to agarbatti units. Perfume compounds you sell for dipping incense sticks are 18% (S. No. 59), even though the agarbatti made from them is 5%. Your buyer may chase you for a lower rate. Don't give one. Our agarbatti makers GST guide explains how they recover the difference through a refund.
Inputs: why your credit is small
Your biggest raw material carries no GST, so there's no credit on it. Most other inputs are at the same 18% as your output, so credit doesn't pile up the way it does in a 5% trade.
Comparison
GST on Common Inputs of an Attar or Perfume Unit
| Input (HSN) | GST | Notification entry |
|---|---|---|
| Fresh cut flowers such as rose, jasmine, kewda (Chapter 6) | Nil | 10/2025-CT(R), S. No. 26 |
| Fresh or chilled aromatic plants and parts used in perfumery (1211) | Nil | 10/2025-CT(R), S. No. 87 |
| The same plants, frozen or dried (1211) | 5% | 9/2025-CT(R), Schedule I, S. No. 71 |
| Denatured ethyl alcohol and other spirits (2207) | 18% | 9/2025-CT(R), Schedule II, S. No. 2 |
| Glass bottles, phials and stoppers (7010) | 18% | 9/2025-CT(R), Schedule II, S. No. 250 |
| Paper or paperboard cartons and boxes (4819 10, 4819 20) | 5% | 9/2025-CT(R), Schedule I, S. No. 322 |
Source: Notifications 9/2025-Central Tax (Rate) and 10/2025-Central Tax (Rate), both dated 17 September 2025
Example (one month, Kannauj maker): you sell attar worth Rs 8,00,000 to dealers in Uttar Pradesh. Output tax is 18% of Rs 8,00,000 = Rs 1,44,000 (Rs 72,000 CGST + Rs 72,000 SGST). You bought Rs 3,00,000 of fresh rose and kewda flowers (nil), Rs 1,50,000 of glass phials (18%, credit Rs 27,000) and Rs 60,000 of cartons (5%, credit Rs 3,000). Credit is Rs 30,000, so you pay Rs 1,14,000 in cash. Price your attar knowing that most of the GST comes out of the value you add, not the inputs.
Reverse charge on mint oil bought from farmers
This is the rule that trips up mentha traders and perfume units that buy oil straight from field distillers. Under S. No. 3A of Notification 4/2017-Central Tax (Rate), as substituted by Notification 14/2022-Central Tax (Rate) with effect from 1 January 2023, these oils (HSN 3301 24 00 and 3301 25 10 to 3301 25 90) are under reverse charge when an unregistered person supplies them to a registered person:
- oil of peppermint (Mentha piperita)
- spearmint oil, water mint oil, horsemint oil and bergamot oil (ex-mentha citrate)
- Mentha arvensis
The registered buyer pays the tax, not the farmer. If the distiller is registered and charges GST on an invoice, normal forward charge applies and you don't pay again.
Step-by-Step Guide
Paying Reverse Charge on a Mint Oil Purchase
For a registered buyer purchasing from an unregistered distiller
Fix the time of supply
The earliest of the date you receive the oil, the date of payment, or the day after 30 days from the supplier's bill (Section 12(3), CGST Act).
Issue a self-invoice
Section 31(3)(f) requires you to raise the invoice yourself, within 30 days of receiving the goods (Rule 47A, in force from 1 November 2024).
Issue a payment voucher
When you pay the farmer, issue a payment voucher (Section 31(3)(g)).
Pay the tax in cash
Reverse charge isn't 'output tax' (Section 2(82)), so you can't pay it from your credit ledger. Pay it through the cash ledger in GSTR-3B.
Claim the credit
Once paid, the same tax is available as input tax credit if the oil is used for your taxable business, subject to Section 16.
Source: Notification 4/2017-Central Tax (Rate), S. No. 3A (substituted by 14/2022-CT(R)); Sections 2(82), 12(3), 16, 31(3)(f) and (g), CGST Act 2017; Rule 47A, CGST Rules 2017
Example: you buy 100 kg of peppermint oil from natural menthol at Rs 1,800 per kg from a farmer who isn't registered. Value: Rs 1,80,000. The rate is 5% (Schedule I, S. No. 224), so you pay Rs 4,500 CGST and Rs 4,500 SGST, Rs 9,000 in all, in cash with that month's GSTR-3B. You claim Rs 9,000 as credit in the same return. Your cash is out for a month, but the tax is a wash if you sell the oil in a taxable supply. If you skip it, the tax and interest are recoverable from you, not the farmer. Our reverse charge guide covers the reporting tables.
Registration, composition and online selling
The limit depends on your State. Section 22(1) of the Central Goods and Services Tax (CGST) Act sets Rs 20 lakh. Notification 10/2019-Central Tax raises it to Rs 40 lakh for suppliers of goods only, but ten States and Union Territories are excluded, including Telangana and Uttarakhand. So a Kannauj or Lucknow maker selling only within Uttar Pradesh has a Rs 40 lakh limit, while an attar shop in Hyderabad's Old City has Rs 20 lakh. Our GST registration limit guide lists each State.
Two triggers override the limit. A single sale to a buyer in another State needs registration (Section 24(i)), and attar is a trade built on dealers in other cities and courier orders. Selling through a marketplace that collects tax under Section 52 also needs registration (Section 24(ix)), with one exception: since 1 October 2023, a supplier within the threshold can sell goods inside one State through such a platform on a PAN-based enrolment number instead (Notification 34/2023-Central Tax). The moment you ship to another State, that relief is gone.
Composition rarely fits. A manufacturer with turnover up to Rs 1.5 crore can opt for composition (Notification 14/2019-Central Tax), and perfumes aren't on its excluded list. You'd pay 1% of turnover (Rule 7, CGST Rules) and claim no credit (Section 10(4)). But you couldn't make any inter-State sale (Section 10(2)(c)), and your dealers couldn't claim credit on your bill. Our composition scheme guide covers the rest.
Comparison
Which GST Route Fits Your Attar Business?
| Your situation | Registration | What you charge |
|---|---|---|
| Counter sales in one State, turnover within the State limit | Optional | No GST if unregistered |
| Any sale or courier order to another State | Compulsory, Section 24(i) | 18% IGST |
| Marketplace sales within one State, turnover within the limit | Enrolment number allowed, Notification 34/2023-CT | No GST if unregistered |
| Small maker selling only in own State, wants low compliance | Registered under composition | 1% of turnover, no tax on bill |
| Export of attar to the Gulf or elsewhere | Registered | Zero-rated under LUT, Section 16(3)(a), IGST Act |
Source: Sections 10, 22, 24 and 52, CGST Act 2017; Notifications 10/2019, 14/2019 and 34/2023-Central Tax; Section 16, IGST Act 2017
Free samples and testers. Section 17(5)(h) blocks input tax credit on goods "disposed of by way of gift or free samples". If you hand out 2 ml vials at trade fairs or send sample kits to new dealers, reverse the credit on the oil, bottles and packing used for them. Exporters should read our export of goods guide for the Letter of Undertaking (LUT) and refund steps.
Income tax: 44AD, cash and TDS on bulk sales
Presumptive tax. A resident individual, Hindu Undivided Family (HUF) or partnership firm (not an LLP) can declare 6% of turnover received through banks or digital modes and 8% of the rest. The limit is Rs 2 crore, or Rs 3 crore where cash receipts don't exceed 5% of turnover. For FY 2025-26 that's Section 44AD of the 1961 Act. From tax year 2026-27 it's Section 58(2), Table Sl. No. 1 of the Income-tax Act 2025, with the same rates and limits.
Example (FY 2025-26): a proprietor's turnover is Rs 60,00,000, of which Rs 52,00,000 came by bank transfer and UPI and Rs 8,00,000 in cash at the counter.
- 6% of Rs 52,00,000 = Rs 3,12,000
- 8% of Rs 8,00,000 = Rs 64,000
- Presumptive profit = Rs 3,76,000
Drop the scheme in a later year and the five-year bar in Section 44AD(4) (Section 58(7) of the 2025 Act) can keep you out of it for the next five years. Our Section 44AD guide covers it.
Cash from customers. Don't accept Rs 2 lakh or more in cash from one person in a day, on one bill or for one event (Section 269ST of the 1961 Act; Section 186 of the 2025 Act). Wedding and Eid season orders from a single family can cross this.
TDS on bulk sales. A buyer whose turnover exceeded Rs 10 crore last year deducts 0.1% on the amount by which its purchases from you in the year exceed Rs 50 lakh (Section 194Q of the 1961 Act; Section 393(1), Table Sl. No. 8(ii) of the 2025 Act). If a cosmetics company buys Rs 90 lakh of essential oils from you in tax year 2026-27, it deducts 0.1% of Rs 40 lakh, which is Rs 4,000. Check it in your tax credit statement before you file. Our 194Q guide explains who deducts.
Deadline Timeline
Upcoming Income Tax Dates for Attar and Perfume Businesses
Advance tax, third instalment
75% of advance tax for tax year 2026-27 if you are not declaring profit under Section 58(2) (Section 408(1), Income-tax Act 2025).
Last date for a belated AY 2026-27 return
Section 139(4). Late fee Rs 5,000, or up to Rs 1,000 if total income is within Rs 5 lakh (Section 234F).
Single advance tax instalment for 44AD-type profit
Section 408(2), Income-tax Act 2025. Paying by 31 March still counts as advance tax.
Source: Sections 139(4) and 234F, Income-tax Act 1961; Section 408, Income-tax Act 2025
If you missed the AY 2026-27 due date, our guide to filing after the deadline walks through the belated return.
Common mistakes attar and perfume businesses make
- Billing attar at 5% because "it's a natural product". Only natural menthol goods are at 5%. Attar, rose oil, sandalwood-based attar and every perfume are 18%.
- Skipping reverse charge on farmer mint oil. The farmer has nothing to pay; you do. Missed reverse charge is a demand on you with interest, even though the credit would have offset it.
- Courier sales to other States without registration. One parcel to Mumbai or Delhi needs registration under Section 24(i), whatever your turnover.
- Claiming credit on free samples. Credit on sample vials and gift packs is blocked by Section 17(5)(h).
- Taking big cash orders. Rs 2 lakh or more in cash from one buyer in a day brings a penalty equal to the amount.
If you also sell cosmetics and deodorants at the counter, our cosmetics shop GST guide covers the 5% and 18% split for those products. Ayurvedic oil makers should read our Ayurvedic medicine GST guide.
How Tax Garden helps
We register attar and perfume units under GST, set up invoice descriptions and HSN codes so attar, perfume and mint oil go out at the right rate, and pay reverse charge on oil bought from unregistered distillers each month. We file GSTR-1 and GSTR-3B and your income tax return. Start with our GST registration service or GST return filing service, or message us on WhatsApp at 9640290977.
