Consulting codes and the 18% rate
The official SAC list places management consulting and management services, including financial, strategic, human resources, marketing, operations and supply chain advice, under 998311, and business consulting including public relations under 998312. Neither appears in the services annexure of the 56th GST Council's rate changes, so both continue at 18% with full input tax credit. A firm that both advises on HR and runs a recruitment drive should note that recruitment sits in a different group (9985), even though the rate is the same, because clients increasingly reconcile SAC codes on their purchase invoices.
Exporting consulting services
Advice delivered to a client located outside India, paid in convertible foreign exchange or permitted INR, with the consultant in India and the two not being merely establishments of the same person, qualifies as export of services. Under a Letter of Undertaking filed each year on the GST portal the invoice carries no IGST and states supply meant for export under LUT without payment of integrated tax. The foreign remittance should be realised within the permitted period, or the export benefit can be questioned.
Milestone billing and time of supply
For continuous supply under a contract, GST law fixes the invoice date by reference to the milestone or payment due date. Raise the invoice on or before the date the milestone completes or the payment becomes due, whichever the contract links to. Holding invoices until the client signs off can push tax into a later month than the law requires.
TDS by corporate clients
Indian companies deduct income-tax TDS under section 194J on consulting fees, and government departments or notified bodies may also deduct GST TDS at 2% on contracts above ₹2.5 lakh. Both credits should be matched invoice by invoice so receivables are not left open for amounts already paid to the government.
Retainers versus project fees
Many consultants work on a monthly retainer for advisory access alongside fixed-fee projects. A retainer is a continuous supply, so each month's invoice should be raised when the period's payment falls due, with the retainer month printed on the line. Project fees, by contrast, follow milestones. Keeping the two on separate lines, even on one invoice, lets the client book the retainer as a recurring overhead and the project as a one-off cost, and lets you pause one without a credit note on the other. If a retainer includes a fixed number of advisory hours and extra hours are billed, show the excess hours as their own quantity line at the agreed hourly rate.