Nature of Business Code or Profession Code is required to be furnished in ITR 3, ITR 4, ITR 5 and ITR 6. In the new Income tax return (ITR) forms for A.Y. 2019-20 F.Y. 2018-19, below changes are made in Business Code or Profession Code. 

Major Changes

1. For Partners new code has been introduced for showing share of income from partnership firm.
2. Number of Sectors has been increased from 9 to 22
3. Number of classification has been increased from 74 to 345
4. Additional sectors which have been classified are
   • Fish Farming with 6 Sub Sectors
   • Renting of Machinery with 9 Sub Sectors
   • Social and Community Work with 9 Sub Sectors
   • Research and Development with 3 Sub Sectors
   • Extra Territorial Organisations and Bodies
5. Various Business or Professions which were earlier falling under Others; are now been classified under specific Sub Sectors.
6. Trading Wholesalers and  Trading Retailers have been further sub classified from 2 to 28 Sub Sectors
7. Trading Others (old code 0204) has not been specifically shown

Important Points to Know

1. n.e.c. stands for “not elsewhere classified”
2. New code 00001 – Share of Income from firm only – This code is to be used by the partners for showing Income received from Partnership firm. (This code was introduced in AY 2018-19). This is not applicable in  applicable in AY 2019-20.
3. New code 09027 – Wholesale of other products n.e.c. (not elsewhere classified) would include wholesale of products other than motor vehicles, sale of motor parts and accessories, agricultural raw material, food & beverages and tobacco, metals and metal ores, household goods, construction material, hardware and sanitary fittings, cotton and jute, raw wool and raw silk, other textile fibres, industrial chemicals, fertilizers and pesticides, electronic parts & equipment, other machinery, equipment and supplies, waste, scrap & materials for re-cycling.
4. New code 09028 – Retail sale of other products n.e.c. (not elsewhere classified) would include retail sale of products other than textiles, apparel, footwear, leather goods, household appliances, hardware, paint and glass, automotive fuel, motor vehicles, motor parts and accessories, Retail sale of all goods in specialized stores, non-specialized stores, medical suppliers, agencies and stores.
   • For Example : Retail sale of Electrical goods like lights, bulbs, wires, garment accessories etc. 
5. New code 09023 – Retail sale in non-specialized stores – All local grocery stores, kirana stores, all retail products sold in non – specialized stores.
6. New code 10012 – Other hospitality services n.e.c. (not elsewhere classified) would include all activities under hospitality services other than Hotels, Motels, Inns and Dharmshalas, Guest houses and circuit houses, Dormitories and hostels at educational institutions, all types of accommodations, all kinds of Restaurants, Canteens, Independent caterers, Casinos and other games of chance.
   • For Example : Supply of Food packets by any means other than restaurants, canteens and catering.
     
7. New code 16019 – Other professional services n.e.c. (not elsewhere classified)would include professions other than Legal profession, Accounting, book-keeping and auditing profession, Tax consultancy, Architectural profession, Engineering and technical consultancy, Advertising, Fashion designing, Interior decoration, Photography, Auctioneers, Business brokerage, Market research and public opinion polling, Business and management consultancy activities, Labour recruitment and provision of personnel, Investigation and security services, Building-cleaning and industrial cleaning activities, Packaging activities, Secretarial activities.
   • For Example : Professors, Pilots
8. New code 17007 – Other education services n.e.c. (not elsewhere classified) would include education services other than Primary, Secondary, Senior secondary, Higher education, Technical and vocational secondary /  Senior secondary education, Education by correspondence, Coaching Centres and all kinds of Tuition
9. New code 21008 – Other services n.e.c. (not elsewhere classified) would include all services other than Hair dressing and beauty treatment, Funeral and related activities, Marriage bureaus, Pet care services, Sauna and steam baths, massage salons, Astrological and spiritualists’ activities, Private households as employers of domestic staff.
10. Old Code 0202 – Trading Retailers is now under Wholesale and Retail Trade Sectors and further sub classified in new codes 09001, 09003, 09004, 09021, 09022, 09023, 09024 , 09025, 09026, 09028 and 18009.
11. Old code 0203 – Trading Wholesalers is now under Wholesale and Retail trade Sector and further sub classified in new codes 09001, 09003, 09006, 09007, 09008, 09009, 09010, 09011, 09012, 09013, 09014, 09015, 09016, 09017, 09018, 09019, 09020, 09027 and 18009.
12. Old code 0204 – Trading Others has not been specifically shown
13. Old code 0301 – Commission Agents (General commission agents) is now under Wholesale and Retail Trade Sector new code 09005 – General commission agents, commodity brokers and auctioneers
14. Old code 0501 – Civil Contractors is now under Construction Sector and further sub classified in new codes 06001, 06002, 06005, 06010.

How to Choose Correct Business or Profession Code

1. Select the nature of product or services involved to determine the  sector of business or profession.
2. Under each Sector the nature of activity involved is to be seen for determining the sub sector.
3. In case you are undertaking multiple activities, different businesses or profession, then you have to select various codes under the same trade name.
4. In cases where there are more than one trade name for the under single PAN, then you have to mention multiple codes under different trade names.
5. Each Sector has a others code n.e.c., in case your product or services or activity in not specifically listed in the main classification, then one can choose n.e.c.

Nature of Business Code for AY 2018-19 in Comparison With Old Codes  (AY 2017-18) (PDF)

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