Hardware Shop Billing: GST Rates, HSN Codes and Bill Example

Why hardware billing is harder than it looks

A hardware shop can stock five thousand items: screws in twenty sizes, hinges in three finishes, pipes, fittings, paints, tools, cement and a corner of farm equipment. Many of them differ only by size. Many carry different HSN codes and GST rates.

Then the customers differ too. A walk-in buyer wants one tap washer and a quick bill. A contractor wants a quotation for a whole site, takes goods over three weeks, and pays at month-end.

Good hardware shop billing comes down to four things done once and done properly: the item list, the HSN codes, the GST rate on each item, and the way you handle credit.

To make a bill right now, the free GST bill maker takes its own HSN code and GST rate on every line and needs no sign-up.

Setting up thousands of items without losing a week

Do not type items one by one. Build the list in Excel first, then import it.

A naming rule that makes search work

Pick one order of words and stick to it: material, product, size, finish.

• MS Hinge 4 in Black
• SS Hinge 4 in Matt
• PVC Elbow 1 in
• CPVC Elbow 1 in

When every hinge starts with its material and every size uses “in” or “mm” the same way, typing “hinge 4” on the billing screen finds the right one in seconds.

Columns to fill for each item

Column	Example	Why it matters
Item name	MS Hinge 4 in Black	What you search and what prints
Category	Door fittings	Stock and profit reports by category
Unit	NOS, BOX, MTR, KGS	Prints on the bill and in GST reports
HSN code	8302	Mandatory on B2B bills
GST rate	18%	Drives the tax on every line
Sale price	45	Default rate on the bill
Purchase price	32	Profit and stock value
Barcode	Manufacturer code or your own	Scan instead of search
Opening stock	120	Starting quantity (add on the item after import)
Minimum stock	24	Low-stock alert (add on the item after import)

In VyapRise, the item import reads .csv, .xlsx and .xls files, lets you map your columns, shows a preview, and gives back an error file for rows it could not read. It takes the name, code, HSN, GST rate, prices, barcode, category and unit; add opening stock and minimum stock on the items after the import. The Free plan holds a limited number of items (see the pricing page); a full catalogue of thousands of items needs the Pro plan (a yearly plan), and the free trial lets you import it first.

Boxes and pieces from one item

Set up the screw once, in its smallest unit, and add the box as another unit:

• SS Screw 1 in with unit NOS
• Other unit: BOX = 100 NOS, with its own box price if boxes sell cheaper

A contractor buys 3 boxes: choose BOX on the line, and stock falls by 300. A walk-in buys 40 loose: choose NOS. There is one stock figure and nothing to adjust when you open a box. The same works for wire bought by the coil and sold by the metre, or cement by the bag and the kilo. If the box carries its own barcode, add it to the item and scanning it bills the box. Other units work on every plan.

HSN codes: how many digits you need

The number of HSN digits depends on your aggregate annual turnover in the previous financial year:

Previous year turnover	B2B invoices	B2C invoices
Up to ₹5 crore	At least 4 digits	Optional
Above ₹5 crore	6 digits	6 digits

Most hardware shops are under ₹5 crore, so 4 digits on bills to registered buyers is the minimum. Many shops still enter 6 or 8 digits on the item, because a longer code costs nothing and avoids rework if the business grows.

Common chapters you will meet: 2523 for cement, 3208 and 3209 for paints, 3917 for plastic pipes and fittings, 7318 for screws, bolts and nuts, 8205 for workshop hand tools, 8302 for hinges and fittings, and 8481 for taps and valves. Confirm the exact code for each product with your CA or the supplier’s invoice.

GST rates after September 2025

From 22 September 2025, GST moved to mainly two rates, 5% and 18%, with the old 12% and 28% slabs removed for most goods and a 40% rate kept for a short list of luxury and sin goods. For a hardware shop this means:

• Most hardware, fittings, tools, pipes and paints are at 18%.
• Cement moved from 28% to 18%.
• Some farm items moved to 5%, for example drip irrigation and sprinkler equipment.
• Some items stay nil-rated, such as manually operated agricultural hand tools like spades and shovels under HSN 8201.

Rates are set per HSN code, and a product’s exact description can change its rate. Check the current rate for every item when you build your list, and update the item when a rate changes.

Mixed GST rates on one bill: a worked example

A contractor in your own state buys the following. Each line takes its rate from the item.

Item	HSN	Qty	Rate (₹)	Taxable (₹)	GST	Tax (₹)
OPC cement 50 kg bag	2523	10	340	3,400.00	18%	612.00
MS Hinge 4 in	8302	24	45	1,080.00	18%	194.40
Garden spade	8201	2	350	700.00	Nil	0.00
Sprinkler head	8424	5	120	600.00	5%	30.00
Total				5,780.00		836.40

Because the sale is within your state, the tax splits in half:

Rate	Taxable (₹)	CGST (₹)	SGST (₹)
18%	4,480.00	403.20	403.20
5%	600.00	15.00	15.00
Nil	700.00	0.00	0.00
Total	5,780.00	418.20	418.20

Invoice total: ₹5,780.00 + ₹836.40 = ₹6,616.40, rounded off to ₹6,616.

If the same contractor were in another state, the ₹836.40 would be charged as IGST instead. The rates shown are for illustration; confirm each item’s current rate.

A tax invoice can carry a nil-rated line like the spade. When you sell taxable and exempt goods together to an unregistered buyer, the rules also allow a single “invoice-cum-bill of supply”. Our bill of supply vs tax invoice guide explains when each applies.

The purchase side: check the supplier’s rates too

Mixed rates cut both ways. A supplier’s bill for a wholesale order of fittings, pipes and tools also carries several GST rates, and that bill is the basis of your input tax credit.

When you enter a purchase bill, check three things against your item list:

1. The HSN on the supplier’s bill matches yours. If the supplier uses 3917 for a fitting and you use 3926, one of you is wrong. Ask before you sell it on.
2. The GST rate matches. A supplier still charging an old rate after a rate change is common in the first weeks.
3. Both GSTINs are correct: yours on the supplier’s bill, and the supplier’s in your books. Otherwise the bill will not appear in, or will not match, your GSTR-2B, and the credit is at risk.

Getting the purchase side right means the rate on your sale bill is the rate you paid on, and your GST return reconciles without a month-end hunt.

Quotations for contractors

Contractors compare three shops before they buy. A clear quotation wins the order:

1. List every item with size, quantity, rate and GST rate.
2. Show the tax separately, so the contractor sees the real total.
3. State validity, for example “Rates valid for 7 days”, because cement and steel move fast.
4. State delivery terms: who pays for loading and transport.

In VyapRise, a quotation converts into an invoice, a sale order or a delivery challan, so nothing is typed twice. When a contractor takes goods to site over several weeks, a sale order tracks what has been delivered and billed on each line, and you can bill in parts. Quotations, sale orders and delivery challans are part of the Pro plan (a yearly plan) and open during the free trial. For a one-off quote without an account, use the free quotation generator.

Credit customers: keeping the udhaar clean

Hardware shops run on credit. Three habits keep it under control:

• Give every credit customer a credit period. Each invoice then gets a due date.
• Record each receipt against the invoices it pays. A lump sum “on account” makes the ledger hard to read later.
• Check the ageing report every week. It groups what each customer owes by how long it has been due.

In VyapRise, the party ledger shows on every plan (the current month on Free); on the Pro plan, the ledger covers any period and the statement can be downloaded as a PDF and shared on WhatsApp. Overdue reminders show in the app’s notification bell; on the Pro plan VyapRise can also email payment reminders to customers automatically, but it does not send WhatsApp or SMS reminders. You can set a credit limit on a customer: by default the invoice form warns when a new bill would cross it, and a setting can make such a bill (or one for a customer with long-overdue dues) wait for the owner’s approval. Receipts are part of Pro; on the Free plan, a payment is recorded on the invoice itself. For balances from before you started, a receipt (Pro) can be recorded against “old invoices”, or each customer’s unpaid bills can be imported as opening bills on any plan. Our guide to keeping udhaar records covers the routine in more detail.

Barcodes for small, fiddly items

Small items are where counter mistakes happen. Scan the manufacturer barcode where there is one, and print your own labels for loose items. A USB or Bluetooth scanner works on the VyapRise sales invoice on every plan; scanning on the purchase bill and label printing are part of Pro. Our guide to barcode label printing walks through the setup.

Billing software for your hardware shop

The setup above takes a weekend: build the Excel list, import it, check rates, and start billing on Monday. See how VyapRise handles items, rates and credit on the billing software for hardware shops page, and the GST side (place of supply, HSN, GSTR-1) on the GST billing software page.