GST on Security Services: Rate, RCM & ITC Rules (2026)
Updated: 3 June 2026 | CGST Act 2017 | Notification 13/2017-CT(Rate)
Security services provided by a body corporate attract 18% GST (SAC 998525) under forward charge. If the provider is an individual or non-body-corporate firm, the registered recipient pays 18% GST under Reverse Charge Mechanism (RCM) as per Notification 13/2017-CT(Rate). ITC is available in both cases for business use.
18%
GST rate on security agency services (SAC 998525)
Body corporate: forward charge | Individual/proprietor supplier: RCM on registered recipient
Body corporate: forward charge | Individual/proprietor supplier: RCM on registered recipient
GST Rate Summary — Security Services
| Service Type | SAC / HSN | GST Rate | Charge Mechanism | ITC Available? |
|---|---|---|---|---|
| Security guard supply by body corporate | 998525 | 18% | Forward Charge | Yes |
| Security services by individual / proprietor | 998525 | 18% | RCM (recipient pays) | Yes (after RCM payment) |
| Security services by partnership firm | 998525 | 18% | RCM (if recipient is registered) | Yes |
| Guards hired directly on payroll | N/A | NIL | Employer-Employee (not GST) | N/A |
| CCTV cameras / surveillance equipment | 8525 | 18% | Forward Charge (goods) | Yes |
| Alarm systems installation service | 998525 | 18% | Forward Charge | Yes |
| AMC for security systems | 998725 | 18% | Forward Charge | Yes |
| Security services to government body | 998525 | 18% | RCM (government pays) | Government may not claim ITC |
When RCM Applies — Notification 13/2017 Explained
Under Entry 14 of Notification No. 13/2017-Central Tax (Rate), security services provided by any person other than a body corporate to a registered person are covered under RCM. A "body corporate" means a company incorporated under the Companies Act (Pvt Ltd, Public Ltd, OPC) or an LLP. Proprietorships, partnership firms, and individuals are not body corporates.
Key RCM compliance steps: (1) Supplier issues invoice without GST. (2) Registered recipient self-invoices and declares 18% RCM liability in GSTR-3B (Table 3.1(d)). (3) Pay RCM liability through cash ledger only — ITC balance cannot be used. (4) Claim ITC of the amount paid as RCM in the same or next period.
ITC Eligibility on Security Services
Security services qualify as eligible input services for ITC under Section 16 of the CGST Act. Businesses — factories, offices, malls, hospitals, hotels — can claim full ITC on security expenses. The credit is not blocked under Section 17(5). Ensure: invoice in your GSTIN name, payment within 180 days, and credit reflecting in GSTR-2B before claiming.
Frequently Asked Questions
What is the GST rate on security guard services provided by a body corporate?
Security services provided by a body corporate (private limited, public limited, LLP) attract 18% GST under SAC 998525. The body corporate issues a GST invoice and charges 18% (9% CGST + 9% SGST for intra-state, or 18% IGST for inter-state). This is a forward charge mechanism — the security agency collects and deposits the tax. The recipient of the service (the business hiring security) can claim Input Tax Credit (ITC) on this 18% GST, provided the security service is used for business purposes and not for personal or restricted use. The security agency must be GST-registered to charge GST. If annual turnover is below the threshold (₹20 lakh for services), registration is voluntary, but once registered, 18% applies uniformly.
When does Reverse Charge Mechanism (RCM) apply to security services?
Reverse Charge Mechanism (RCM) applies under Notification No. 13/2017-Central Tax (Rate) when security services are provided by any person other than a body corporate to a registered person (recipient). Practically, this means: if an individual security guard, sole proprietor, or partnership firm (non-body-corporate) provides security services to a GST-registered business, the business (recipient) must pay 18% GST under RCM instead of the supplier. The registered recipient files RCM liability in GSTR-3B, pays it through cash ledger, and can claim ITC in the same or subsequent month. The supplier (individual/proprietor guard or agency) does not charge GST on the invoice. Exemption: if the recipient is also a non-body-corporate or unregistered, RCM may not apply — consult your tax advisor for edge cases.
Is GST applicable on security guard salary paid directly through payroll?
No, GST does not apply on salaries paid directly to security guards employed on payroll. When guards are on the company's payroll as regular employees (not through a third-party agency), the relationship is employer-employee. The employer deducts TDS under Section 192, contributes to PF/ESIC, and there is no GST implication. GST is a tax on supply of goods or services, and employment is specifically excluded from the definition of "supply" under Schedule III of the CGST Act, 2017. Payroll costs (salary, PF, ESIC, gratuity, bonus) are not subject to GST. Only when security services are procured through an external agency or contractor does GST apply. The distinction between employee and contractor is important — misclassification can create GST liability under RCM.
Can a business claim ITC on GST paid for security services?
Yes, Input Tax Credit (ITC) is fully available on GST paid for security services, subject to the general conditions under Section 16 of the CGST Act. The conditions are: (a) you must possess a valid tax invoice, (b) the security service must be used for furtherance of business, (c) the supplier must have filed their returns and the credit must appear in GSTR-2B, and (d) payment must be made to the supplier within 180 days. Security services are not among the blocked credits under Section 17(5). Even under RCM, after paying 18% GST in cash, the recipient can claim that amount as ITC in the same period (subject to utilization rules). ITC on security services is valid for factories, offices, retail stores, hotels, hospitals — any business use. It cannot be claimed if the service is for personal residential security.
What GST applies on CCTV installation, alarm systems, and surveillance equipment?
CCTV cameras and surveillance equipment are goods classified under HSN 8525 (transmission apparatus) and attract 18% GST. When a security company supplies and installs CCTV systems, it is typically a composite supply or works contract — if the principal supply is installation services, the whole contract attracts 18% GST. Alarm systems and fire detection equipment (HSN 8531) also carry 18% GST on goods. Installation and maintenance of alarm systems as a service (SAC 998525) attracts 18% GST. If the security agency provides a bundled contract — guards + CCTV + monitoring — the entire composite supply takes the rate of the principal supply (usually 18%). Annual maintenance contracts (AMC) for security systems: 18% GST. Biometric attendance systems used for access control: 18% GST on both goods and installation services.
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