Key takeaways
What this article covers, in order:
- What GST does a restaurant charge?
- What about Swiggy and Zomato orders?
- Do I have to register, and should I go composition?
- A month at Bean & Brew, Bengaluru
- Monthly or quarterly?
- A short checklist for restaurant GST
The lunch rush is over, the espresso machine is finally quiet, and your accountant has messaged asking for "last month's Swiggy and Zomato reports, plus dine-in". Restaurant GST looks simple at 5%, but there are a couple of twists that trip owners up. If your café or restaurant is registered as a regular taxpayer, HelloBooks files GSTR-1 and GSTR-3B for one GSTIN free, directly to the GST portal. Here's how restaurant GST really works, and when the free plan is or isn't enough.
What GST does a restaurant charge?
For a standalone restaurant, café, cloud kitchen, dhaba or food court outlet, the rate on restaurant service is 5% (2.5% CGST + 2.5% SGST), without input tax credit. That covers dine-in, takeaway and your own home delivery.
The "without ITC" part is the bit people underestimate. You can't claim the GST you pay on ingredients, packaging, rent, kitchen equipment, your POS subscription or the aggregators' commission. That GST becomes a cost, just like the rent itself. You need to price your menu with that in mind.
The one main exception is restaurants inside "specified premises". Broadly, that's a hotel that supplied rooms at a declared tariff above ₹7,500 per unit per day in the previous financial year, or a hotel that has opted in. Restaurant service there is taxed at 18% with ITC.
A standalone restaurant can't choose 18% with ITC, however much equipment it's buying. The GST Council has specifically clarified that point. Outdoor catering has its own rules, so if you do a lot of event catering, check the current rate entry with your CA.
What about Swiggy and Zomato orders?
Since 1 Jan 2022, for restaurant service supplied through an e-commerce operator, the operator pays the GST under Section 9(5). The customer pays 5% on the food to Swiggy or Zomato, and the platform deposits it.
For you, that means:
- You don't charge or pay GST on aggregator orders. Don't double-count it in your own liability.
- You still report those sales in GSTR-1, in the section for supplies on which the e-commerce operator pays tax. They count in your turnover.
- The platform's commission and service fees are billed to you with 18% GST. As a 5%-without-ITC restaurant, you can't claim that. It's a cost.
Plenty of small restaurants pay 5% on their aggregator sales by mistake, alongside the platform. If your dine-in and aggregator sales aren't separated in your books, that's where the overpayment hides.
Do I have to register, and should I go composition?
Restaurant service is a service, so the registration threshold is ₹20 lakh of aggregate turnover (₹10 lakh in the special category states). If you sell through aggregators, they'll usually insist on a GSTIN anyway.
Restaurants can also choose the composition scheme if turnover is up to ₹1.5 crore. The rate is 5% of turnover, and you issue a bill of supply instead of charging GST. Since the regular rate is also 5% with no ITC, the tax cost is often similar. The difference is paperwork. Composition means CMP-08 every quarter and GSTR-4 yearly, while regular means GSTR-1 and GSTR-3B. HelloBooks files GSTR-1 and GSTR-3B; it doesn't file composition returns. How composition interacts with aggregator sales is worth checking with a CA before you switch.
A month at Bean & Brew, Bengaluru
Let's take Arjun's café in Indiranagar, a regular taxpayer filing monthly. These are illustrative figures for Oct 2026:
| Value | GST | |
|---|---|---|
| Dine-in and takeaway sales | ₹6,00,000 | ₹30,000 (5%) |
| Swiggy and Zomato orders (food value) | ₹3,00,000 | Paid by the platforms under 9(5) |
| Platform commissions and fees | ₹75,000 | ₹13,500, no ITC |
| Ingredients, packaging, rent with GST | about ₹3,50,000 | GST paid is a cost, no ITC |
GST Arjun pays in cash: ₹30,000, which is CGST ₹15,000 plus SGST ₹15,000. His GSTR-1 shows ₹6,00,000 of B2C sales at 5%, plus ₹3,00,000 reported as supplies where the operator pays tax. His total turnover for the month is ₹9,00,000.
Due dates are GSTR-1 by 11 Nov 2026 and GSTR-3B by 20 Nov 2026. If he were on QRMP instead, he'd pay through PMT-06 by 25 Nov 2026 and file quarterly.
Notice the ₹13,500 of GST on commissions that Arjun can't recover. Over a year, that's about ₹1.6 lakh. It's one reason the aggregator price of a dish is usually higher than the menu price.
Monthly or quarterly?
With no ITC to reconcile and mostly B2C sales, many restaurants are happy on QRMP. That means four GSTR-1s and four GSTR-3Bs a year, plus a monthly challan. Corporate customers who want tax invoices for team lunches are often fine waiting a quarter, or you can upload their invoices through IFF by the 13th.
Monthly suits you if you'd rather pay the exact tax each month than deal with PMT-06 calculations. It's also simpler to match against monthly POS reports.
A short checklist for restaurant GST
- [ ] Confirm you're a standalone restaurant (5%, no ITC) and not in specified premises (18%, ITC)
- [ ] Split your POS sales into dine-in/takeaway and aggregator sales
- [ ] Report aggregator sales in GSTR-1 as operator-paid supplies, and don't pay tax on them again
- [ ] Don't claim ITC on ingredients, rent or commission
- [ ] Check reverse charge if you rent from an unregistered landlord
- [ ] Issue proper tax invoices to corporate customers who ask
- [ ] Keep monthly POS Z-reports and aggregator payout statements together
The 200-transaction limit, honestly
HelloBooks Free covers 200 transactions a year. A café serving 150 bills a day can't enter each one on Free, and even one sales entry a day comes to 365.
Free fits a restaurant that posts monthly summaries: one dine-in sales entry, one aggregator sales entry, the payout statements, and a short list of supplier bills. A small café or cloud kitchen can sometimes stay inside that. Most restaurants with a full supplier list (vegetables, dairy, meat, gas, packaging, rent, staff payments) will get there faster than they expect. Pro at ₹499/month removes the transaction cap and gives unlimited users, so your manager and your CA can both be in the books. Compare on the pricing page.
How HelloBooks helps
HelloBooks files GSTR-1 and GSTR-3B directly to the GST portal from inside the app, for one GSTIN on the free plan. Before you file GSTR-3B, you see the GST portal's own interest and late-fee figure. You can reconcile UPI, Paytm, PhonePe and Razorpay collections, and import bank statements to match aggregator payouts against your sales summary. The P&L shows clearly what the non-claimable GST on commissions and rent is costing you. And your CA can be invited into the same books.
If you're weighing up a simpler billing app, our free GST billing software page explains the difference between billing and actually filing returns. The GSTR-1 filing guide goes deeper into the return itself.
FAQs
Can a café claim ITC on its coffee machine?
Not if it charges 5% on restaurant service, which is the case for standalone restaurants and cafés. That rate comes without ITC.
Do I pay GST on Swiggy and Zomato orders?
No. Since 1 Jan 2022 the platform pays GST on restaurant service supplied through it, under Section 9(5). You still report those sales in GSTR-1.
Can my standalone restaurant choose 18% with ITC?
No. The 18%-with-ITC option applies to restaurants in specified premises, which essentially means hotels with higher room tariffs. Standalone restaurants are clarified to be outside it.
Should a small restaurant opt for composition?
It can, at 5% of turnover up to ₹1.5 crore. The tax cost is often similar to the regular rate, so the choice is mostly about paperwork. Note that HelloBooks doesn't file composition returns.
Is HelloBooks Free enough for my restaurant?
If you post monthly summaries and have few supplier bills, possibly. Busier restaurants will usually need Pro at ₹499/month.
Split your aggregator sales from day one. It's the single habit that saves restaurants the most GST grief.
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