All beauty parlour, salon, barber, spa and grooming services now attract 5% GST without Input Tax Credit (SAC 999721). GST 2.0 cut this from 18% (with ITC) effective 22 September 2025. Registration is mandatory once turnover crosses ₹20 lakh. Retail cosmetics sold in the salon are taxed separately, mostly at 18%.
GST on Salon Services — Rate Table
The current GST rate for every common beauty and grooming service, with its SAC code. All personal-grooming services carry the same 5% rate.
| Service | GST Rate | SAC | ITC |
|---|---|---|---|
| Haircut, hair styling & blow-dry | 5% | 999721 | No |
| Hair colouring, highlights, balayage | 5% | 999721 | No |
| Facial, clean-up & skin treatment | 5% | 999721 | No |
| Threading, waxing & de-tan | 5% | 999721 | No |
| Manicure, pedicure & nail art | 5% | 999722 | No |
| Bridal / party make-up | 5% | 999722 | No |
| Hair spa, keratin, smoothening, rebonding | 5% | 999721 | No |
| Barber shop / men's grooming | 5% | 999721 | No |
| Spa, massage & wellness (non-medical) | 5% | 999729 | No |
| Parlour below ₹20L turnover | Nil | — | — |
| Retail cosmetics sold in salon (make-up) | 18% | HSN 3304/3307 | Yes |
Rates reflect the GST 2.0 two-slab structure effective 22 September 2025 (services cut 18%→5% without ITC). Confirm on the official GST portal before invoicing.
Old 18% vs New 5% — the Trade-off
GST 2.0 slashed beauty and physical well-being services from 18% to 5% — but removed Input Tax Credit as the trade-off. Customers pay less; salons can no longer offset GST paid on rent, products and equipment.
Before 22 Sep 2025 — with ITC
- All salon/spa services taxed at 18%
- Full ITC on shampoo, wax, colour, equipment
- Higher bill for the customer
- Input GST was recoverable
From 22 Sep 2025 — no ITC
- All salon/spa/barber services now 5%
- Input Tax Credit no longer available
- Cheaper for the customer
- Input GST is now an embedded cost
Because the new rate is 5% without ITC, the GST you pay on rent, products, gas, air-conditioning and equipment is no longer creditable — it becomes a cost you price into your services. Only the retail cosmetics you resell keep their ITC.
Not sure how the 5% cut affects your salon's pricing and ITC?
Get My GST Position →GST on Cosmetics Sold in the Salon
Selling retail cosmetics is a separate supply of goods from your 5% service. Each product follows its own HSN rate — invoice it on a separate line.
| Product | HSN | GST Rate |
|---|---|---|
| Make-up — lipstick, foundation, kajal, eye-shadow | 3304 | 18% |
| Nail polish / nail colour | 3304 | 18% |
| Perfume & deodorant | 3307 | 18% |
| Shampoo, conditioner, hair oil | 3305 | 5% |
| Toilet / beauty soap | 3401 | 5% |
| Toothpaste, toothbrush | 3306/9603 | 5% |
| Ayurvedic / herbal skin & hair products | 3304/3305 | 5% |
GST 2.0 cut many daily-use items (soap, shampoo, hair oil, toothpaste) to 5%; make-up & perfume stay at 18%. Verify each HSN on the CBIC rate finder.
If a package is primarily a service with an incidental product (e.g. a facial including the cream applied), it is a composite supply taxed at the 5% service rate. If you sell a jar of cream to take home, that is a separate goods supply at its own HSN rate. Bill service and product as distinct line items to stay clear.
Selling both services and products? Get your invoicing set up correctly.
Talk to a GST Expert →ITC for a Beauty Parlour — What You Can & Can't Claim
Because salon services are now 5% without ITC, GST on inputs used to provide those services is no longer creditable. ITC survives only where you resell taxable goods.
| Input / Purchase | ITC? | Reason |
|---|---|---|
| Shampoo, wax, colour, creams used in service | No | Consumed in a 5% no-ITC service |
| Salon equipment (dryer, steamer, chairs) | No | Capital goods for a 5% no-ITC service |
| Disposables (cotton, foils, gloves) | No | Consumed in 5% no-ITC service |
| Cosmetics purchased for retail resale | Yes | Used to make a taxable 18% goods supply |
| Renovation / interior fit-out of salon | No | Blocked under Section 17(5)(d) — immovable property |
| Personal cosmetics used by owner / staff | No | Personal use — not a business supply |
The no-ITC rule follows the 5% rate; the resale of retail products remains fully ITC-eligible.
Want your ITC recalculated after the 5% switch?
Get ITC Advice →GST Registration for a Salon or Parlour
Registration becomes mandatory once aggregate turnover crosses:
- ₹20 lakh/year — most states
- ₹10 lakh/year — special-category states (Manipur, Mizoram, Nagaland, Tripura, etc.)
- Any amount — if you make inter-state supplies or supply through an e-commerce operator
Below the threshold you must not charge GST. Small salons up to ₹1.5 crore can instead opt for the composition scheme (6% total — 3% CGST + 3% SGST — paid from your own pocket, no GST on the bill, no ITC, quarterly CMP-08).
Salon GST Compliance Checklist
- GST registration (GSTIN)
- Correct 5% rate & SAC 999721
- Separate line for retail product sales
- Tax invoice / bill of supply
- GSTR-1 (outward supplies)
- GSTR-3B (monthly/quarterly)
- No ITC claimed on service inputs
- ITC only on resold cosmetics
- E-invoicing (if applicable)
- GSTR-9 annual return
- Composition CMP-08 (if opted)
- Books & records upkeep
The 5% cut is good for customers but pinches salons that used to recover input GST. Review your pricing, stop claiming ITC on service inputs from 22 Sep 2025, and keep product sales on separate invoice lines so your 18% resale ITC is not lost.
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