Restaurant GST & Billing Guide India 2026: Rates, Rules, and Compliance

Understanding Restaurant GST

GST for restaurants in India isn't one-size-fits-all. Your rate depends on your restaurant type, location, and whether you have air conditioning.

Current GST Rates for Restaurants (2026)

Restaurant TypeGST RateInput Tax Credit (ITC) Non-AC, non-alcohol5%No AC dining5%No Restaurants in hotels (tariff < ₹7,500)5%No Restaurants in hotels (tariff ≥ ₹7,500)18%Yes Outdoor catering5% (without ITC) or 18% (with ITC) Cloud kitchen / delivery5%No Takeaway food5%No

Key Rules Every Restaurant Owner Must Know

1. Registration Threshold

Mandatory GST registration if turnover exceeds ₹20 lakh (₹10 lakh in special category states)

Voluntary registration allowed below threshold

2. Service Charge ≠ GST

Service charge is optional and set by the restaurant

GST is charged ON the service charge amount

Example: Food ₹1,000 + 10% service charge (₹100) = ₹1,100. GST 5% on ₹1,100 = ₹55

3. Composition Scheme

Available for restaurants with turnover up to ₹1.5 crore

Pay 5% GST (effectively 1% for composition dealers)

Cannot charge GST on bill (absorb it)

Simplified quarterly filing

Billing Best Practices

Every restaurant bill must include:

Restaurant name and GSTIN

Bill number (sequential)

Date and time

Item-wise details with prices

GST amount (clearly shown)

Total amount

SAC code (9963 for restaurant services)

How Digital Billing Helps

With QRBites digital ordering:

GST is automatically calculated on every order

Bills are generated with all required fields

SAC codes are pre-configured

Daily/monthly GST reports are available in dashboard

No manual calculation errors

Common GST Mistakes to Avoid

Charging wrong rate — AC restaurants still pay 5%, not 18%

Not displaying GSTIN — Must be on every bill and at the entrance

Mixing supply types — Dine-in, takeaway, and delivery can have different treatments

Late filing — File GSTR-1 and GSTR-3B on time to avoid penalties

Not maintaining records — Keep purchase invoices for at least 6 years

Monthly Compliance Calendar

DateTask 11thFile GSTR-1 (outward supplies) 13thFile GSTR-2B auto-generated (verify) 20thFile GSTR-3B (monthly return + payment) End of monthReconcile sales with GST portal

When to Hire a CA

If your restaurant:

Crosses ₹20 lakh turnover → Must register, consider CA

Crosses ₹1 crore turnover → Definitely need a CA

Has multiple locations → Need proper GST compliance

Serves alcohol → Complex tax treatment

Digital Records = Easy Compliance

QRBites automatically maintains:

Complete order history with timestamps

GST breakdowns per order

Daily and monthly revenue summaries

Exportable reports for your CA

This makes GST filing 10x faster and virtually error-free.

Get GST-compliant digital billing with QRBites →