Looking for expert help with GST and income tax for lift and elevator dealers and installers 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
- Lifts and escalators (HSN 8428) and their parts (HSN 8431) carry 18% GST under Notification 9/2025-Central Tax (Rate), Schedule II.
- Lift installation (SAC 995466) and lift maintenance or AMC (SAC 998718) are also 18%, under Notification 11/2017-Central Tax (Rate).
- A lift supplied and fixed in a building is usually a works contract (Section 2(119), CGST Act). The place of supply is the building's state, so an out-of-state site means IGST.
- Clients deduct 1% or 2% TDS on installation and AMC bills; government buyers also deduct 2% GST TDS on contracts above Rs 2.5 lakh.
- Composition at 6% rarely suits you, because the lift you buy carries 18% GST you then can't recover.
What is the GST rate on lift installation and AMC in India? All three parts of a lift business are taxed at 18%. The lift itself (HSN 8428) is 18% under Notification 9/2025-Central Tax (Rate). Installation (SAC 995466) and maintenance or AMC (SAC 998718) are 18% under Notification 11/2017-Central Tax (Rate). What changes from job to job is the code, the place of supply and who can claim the credit. Verified against: taxinformation.cbic.gov.in.
This guide is for lift dealers, independent installers, sub-contractors who erect lifts for manufacturers, and firms running lift AMCs for apartments, hospitals and offices. The rate is the easy part. The questions that cause notices and lost credit are which code goes on the invoice, which state's tax you charge, and how much TDS your client should be taking.
What GST rate and code goes on a lift invoice?
Here's the full map. Every line is 18%, but the code you use tells the officer, and your client's accountant, what you actually supplied.
Comparison
GST Rates and Codes for a Lift Business
| What you bill | Code | GST | Official entry |
|---|---|---|---|
| Lift, escalator, travelator (sold as goods) | HSN 8428 | 18% | Notif 9/2025-CT(R), Sch II, S. No. 417 |
| Parts suitable for use with lifts and escalators | HSN 8431 | 18% | Notif 9/2025-CT(R), Sch II, S. No. 420 |
| Supply and installation of a lift in a building | SAC 995466 (works contract) | 18% | Notif 11/2017-CT(R), S. No. 3, item (xii) |
| Installation only, lift supplied by the client or OEM | SAC 995466 | 18% | Notif 11/2017-CT(R), S. No. 3, item (xii) |
| AMC, breakdown calls, repair | SAC 998718 | 18% | Notif 11/2017-CT(R), S. No. 25 |
Source: Notification 9/2025-Central Tax (Rate); Notification 11/2017-Central Tax (Rate); CBIC Explanatory Notes to the Scheme of Classification of Services
Notification 9/2025 describes heading 8428 as "other lifting, handling, loading or unloading machinery (for example, lifts, escalators, conveyors, teleferics)". That's the entry. Don't confuse it with 8425 (hoists and winches) or 8427 (fork-lift trucks), which are separate lines.
Worked example. A Hyderabad installer, run as a proprietorship, quotes Rs 9,00,000 to supply and install a passenger lift in a five-floor apartment block in Kukatpally. GST at 18% is Rs 1,62,000, split as Rs 81,000 CGST and Rs 81,000 SGST. The association pays Rs 10,62,000.
Is your lift contract goods or a works contract?
When you supply a lift and fix it into a building, it usually becomes part of that building. Section 2(119) of the CGST Act calls a contract for "erection, installation, fitting out ... or commissioning of any immovable property" involving transfer of goods a works contract. Schedule II, para 6(a) treats a works contract as a supply of services.
The rate is 18% either way, so why care? Three things depend on it.
Step-by-Step Guide
How to Treat a Lift Contract Under GST
1. Are you only selling the lift or parts, with no installation?
That's a supply of goods under HSN 8428 or 8431. Normal goods rules apply: e-way bill, and place of supply where the goods are delivered.
2. Are you supplying and installing the lift so it becomes part of the building?
That's a works contract (Section 2(119)), a supply of services (Schedule II, para 6(a)). Use SAC 995466 at 18%.
3. Is the building in a different state from your registration?
The place of supply is the building's location (Section 12(3)(a), IGST Act). Charge IGST, not CGST and SGST.
4. Is the client a government department, local authority or government agency?
If the contract value exceeds Rs 2.5 lakh, the client deducts GST TDS: 1% CGST plus 1% SGST (Section 51). Claim it in your electronic cash ledger.
Source: CGST Act ss. 2(119), 51, Schedule II para 6(a); IGST Act s. 12(3)(a)
Place of supply. Say the same Hyderabad installer wins a contract for a lift in a Bengaluru office. The building is in Karnataka, so the place of supply is Karnataka and the invoice carries IGST of Rs 1,62,000 on a Rs 9,00,000 contract. Charging Telangana CGST and SGST by mistake means paying the right tax again and claiming a refund of the wrong one (Section 77, CGST Act). Our place of supply guide covers the general rules.
Your client's credit. Section 17(5)(c) blocks ITC on works contract services for construction of immovable property, other than plant and machinery, and 17(5)(d) blocks goods and services used to construct it on the owner's own account. The Act's definition of plant and machinery excludes "land, building or any other civil structures". A builder selling flats generally can't use the credit anyway. A hotel or factory buying a lift will ask whether it can. CBIC hasn't issued a circular on lifts, so tell those clients to take a written view instead of promising them the credit. The works contract GST guide explains the wider rules.
AMCs: registration, composition and GST TDS
Most lift firms earn steady money from AMCs. A Rs 36,000 yearly AMC for an office building carries Rs 6,480 GST (18%). It's the same 18% whether the AMC is labour-only or comprehensive with parts, because a comprehensive AMC is a composite supply taxed at the rate of its principal supply, the maintenance service (Section 8(a)).
Registration. Installation and AMCs are services, so the limit is Rs 20 lakh of aggregate turnover (Rs 10 lakh in some special category states) under Section 22. The higher Rs 40 lakh limit is for suppliers of goods only, and you aren't one. Our GST registration threshold guide has the state-wise limits.
Composition. Section 10(2A) lets a service supplier with turnover up to Rs 50 lakh pay 6% (3% CGST plus 3% SGST, Notification 2/2019-Central Tax (Rate)). For a lift business it rarely pays off. You lose all input tax credit, so the 18% GST on every lift and spare part you buy becomes a cost. You also can't make inter-State supplies under it, which rules out that Bengaluru job. It can make sense only for a small, labour-only AMC outfit serving residential associations that can't claim credit.
GST TDS on government work. Hospitals, municipal offices and other government buildings are big lift buyers. Under Section 51, government departments, local authorities and government agencies deduct 1% CGST plus 1% SGST when a contract's value exceeds Rs 2.5 lakh, excluding GST. No deduction applies where your location and the place of supply are in a different state from the client's registration. The deducted amount reaches your electronic cash ledger once you accept it on the portal.
Income tax for lift businesses
Clients deduct TDS on installation and AMC payments as contract work. From 1 April 2026 this is Section 393(1), Table Sl. No. 6(i) of the Income-tax Act 2025; before that it was Section 194C of the 1961 Act. The rates and limits didn't change.
Comparison
Income Tax Rules a Lift Business Meets
| Rule | Rate or limit | 1961 Act (FY 2025-26) | 2025 Act (from 1 Apr 2026) |
|---|---|---|---|
| TDS on installation and AMC bills | 1% individual/HUF, 2% others; Rs 30,000 single or Rs 1,00,000 in the year | Section 194C | Section 393(1), Table Sl. No. 6(i) |
| Supply of a lift made from material bought from others | Not 'work', so no contract TDS on that part | Section 194C Explanation (iv) | Section 402(47)(e)(A) |
| Presumptive income | 6% digital / 8% other; Rs 2 crore or Rs 3 crore | Section 44AD | Section 58 |
| Tax audit (books) | Rs 1 crore, or Rs 10 crore if cash receipts and payments are each within 5% | Section 44AB(a) | Section 63 |
Source: Income-tax Act 1961 ss. 44AB(a), 44AD, 194C; Income-tax Act 2025 ss. 58, 393(1), 402(47)
What counts as "work". Section 402(47)(e)(A) leaves out "manufacturing or supplying a product according to the requirement or specification of a customer by using material purchased from a person, other than such customer". A lift you buy from a manufacturer and resell is that kind of supply. So when your contract shows the lift price and the installation charge separately, the contract TDS applies to the installation line. On a single-price contract the split is less clear. Show the two values on the quotation and invoice so the client knows what to deduct on.
Sub-contractor example. An installation firm (a partnership) erects four lifts for a manufacturer and bills Rs 2,40,000 of labour, plus Rs 43,200 GST. The manufacturer deducts 2% on the Rs 2,40,000: Rs 4,800. Check every quarter that it shows in your Form 26AS and AIS. If it doesn't, the payer has missed your PAN or not filed its TDS statement. Our TDS on contractor payments guide explains the payer's side.
44AD or books? A resident individual, HUF or firm (not an LLP) can declare 6% of turnover received through banking channels and 8% of the rest, within Rs 2 crore turnover (Rs 3 crore if cash receipts are no more than 5%). An installer with Rs 80 lakh of bank receipts declares Rs 4,80,000. If you resell lifts, your margin on the hardware may be thin, but your turnover includes the full lift price. Compare 6% of that turnover with your real profit before choosing. If you opt out of 44AD within five years of using it, Section 44AD(4) brings books and an audit. See our Section 44AD guide.
Common mistakes lift businesses make
- Using HSN 8428 on an installation contract. A supply-and-install job in a building is a works contract service under SAC 995466. The goods code on a services invoice invites questions, even at the same rate.
- Charging CGST and SGST for an out-of-state building. The place of supply follows the building. Get it wrong and you pay IGST again before you can recover the wrong tax.
- Promising clients the ITC on a new lift. Section 17(5)(c) and (d) may block it. Let their own adviser decide.
- One lump-sum price. Without a separate installation value, clients don't know what to deduct TDS on, and over-deduction locks up your cash until refund.
- Taking composition to look cheaper. At 6% with no credit on 18% lifts and parts, it usually costs more and bars inter-State jobs.
How Tax Garden helps lift and elevator businesses
We set the right code and place of supply for every contract, raise invoices with the lift and installation values shown separately, and file your GST returns with government GST TDS accepted on time. If you're starting out, our GST registration service handles the application. At year end we match every client's TDS to your books and file through our ITR filing service. Firms that also do building wiring can read our guide for electricians and plumbers, and HVAC contractors our AC and refrigeration service centre guide.
