KhanaOSStandalone restaurants charge 5% GST without input tax credit; restaurants in hotels with room tariff ≥ ₹7,500/night charge 18% with ITC. Zomato/Swiggy collect the 5% on their orders themselves. Composition scheme (≤ ₹1.5 Cr turnover) trades simpler filing for no ITC and no GST on bills. Verify current GST Council notifications — rates and thresholds change.
The two rates that cover almost every restaurant
GST on restaurant service is deliberately simple on paper: 5% without input tax credit (ITC) for standalone restaurants — dine-in, takeaway or delivery, air-conditioned or not — and 18% with ITC for restaurants operating inside hotels where the declared room tariff is ₹7,500 or more per night. Cloud kitchens supplying food for delivery are treated as restaurant service at 5% without ITC.
The "without ITC" part is what surprises new operators: at 5%, you cannot offset the GST you paid on rent, equipment, packaging or ingredients against the GST you collect. Your input GST is a cost — which is why it must live inside your food cost and pricing math, not outside it.
Composition scheme: simpler, with strings attached
Restaurants with turnover up to ₹1.5 crore can opt for the composition scheme: pay 5% of turnover, file quarterly statements plus an annual return, keep compliance light. The strings: you cannot charge GST on customer bills (you absorb it), cannot claim any ITC, must display "composition taxable person" on signage and bills, and cannot supply through e-commerce operators in most cases — which for a delivery-led business rules it out.
Zomato, Swiggy and Section 9(5)
Since 1 January 2022, food delivery platforms are the ones who collect and remit the 5% GST on restaurant orders placed through them. This does not make those sales invisible to you: they still appear in your returns, and mismatches between platform statements and your own billing records are a common notice trigger. A billing system that records aggregator orders separately from direct orders makes this reconciliation a report, not a weekend.
What your bill must carry
Every GST bill needs your GSTIN, a sequential invoice number and date, itemised charges, the correct CGST/SGST split (or IGST where applicable), the SAC code for restaurant service, and the tax-inclusive total. Service charge, if you levy it, is not a tax — it must be shown separately and is itself subject to GST.
Filing rhythm
Regular scheme restaurants file GSTR-1 (outward supplies) monthly or quarterly under QRMP, and GSTR-3B (summary + payment) monthly. The practical burden is not the filing itself — it is assembling clean sales data. If your billing software exports GSTR-1 and GSTR-3B ready figures, filing prep drops from hours of spreadsheet surgery to minutes.
This guide is general information, not tax advice. GST rates, thresholds and rules change with GST Council decisions — confirm current notifications with your CA before acting.
Frequently asked questions
What is the GST rate for restaurants in India?
5% without input tax credit for standalone restaurants (AC or non-AC, dine-in, takeaway, delivery). 18% with ITC for restaurants inside hotels with room tariff ≥ ₹7,500/night. Rates follow GST Council notifications — verify before filing.
Who pays GST on Zomato and Swiggy orders?
The platforms collect and remit the 5% GST on orders placed through them (Section 9(5), since Jan 2022). You still report those sales in your returns — which is why reconciling platform statements against your billing system matters.
Can a restaurant use the GST composition scheme?
Yes, if turnover ≤ ₹1.5 crore: pay 5% on turnover with simpler filing. Trade-offs: no GST on customer bills, no input credit, and e-commerce platform sales are restricted.
What must a GST-compliant restaurant bill show?
GSTIN, invoice number and date, itemised charges with the correct CGST/SGST or IGST split, SAC code for restaurant service, and tax-inclusive total. Good billing software applies all of it automatically once configured.