GST Billing for Restaurants and Food Businesses in India — Complete Guide
If you run a restaurant, cloud kitchen, food truck, bakery, catering business, or any other food-related business in India — GST billing is one of those topics that seems simple on the surface but has several layers that trip people up.
What is the correct GST rate for your restaurant? Does it matter if you have air conditioning? What about Swiggy and Zomato orders? How do you bill for catering events? What if you sell packaged food alongside restaurant meals?
This guide answers all of it clearly — and shows how GST Maker helps food business owners bill correctly, professionally, and for free.
GST Rates for Restaurants — What Rate Applies to You?
The GST rate for restaurants depends on several factors. Here is the complete breakdown:
Restaurants Not in Hotels (Standalone Restaurants)
5% GST (No ITC) — This is the standard rate for most standalone restaurants in India — whether AC or non-AC. The government simplified the rules in 2019 by removing the AC vs non-AC distinction and making 5% the universal rate for most restaurants. However, under this rate, you cannot claim input tax credit on your purchases.
Restaurants Inside Hotels
5% GST (No ITC) — If the hotel's room tariff is below ₹7,500 per night, the restaurant inside follows the 5% rate.
18% GST (With ITC) — If the hotel's room tariff is ₹7,500 or above per night, the restaurant inside the hotel charges 18% GST — and can claim ITC on inputs.
Outdoor Catering
18% GST (With ITC) — Catering services provided at events, weddings, corporate functions, and other venues outside a restaurant premises attract 18% GST. This is one of the most important distinctions for catering businesses.
Packaged and Processed Food
Selling packaged food items attracts different GST rates depending on the product: - Fresh unpackaged food (vegetables, fruits, unprocessed meat) — 0% GST - Branded packaged food — 5% to 18% depending on the item - Bakery items — 5% to 18% depending on the category - Beverages (non-alcoholic) — 12% to 28% depending on the type
Cloud Kitchens
5% GST (No ITC) — Cloud kitchens operating without a dine-in facility but delivering food are treated as restaurants for GST purposes. The 5% rate applies.
Food Trucks
5% GST (No ITC) — Food trucks serving prepared food follow the restaurant rate of 5%.
GST on Swiggy and Zomato Orders — How It Works
This is one of the most commonly misunderstood aspects of restaurant GST. Here is how it works after the October 2021 rule change:
Before October 2021: Restaurants collected GST from customers and deposited it themselves.
After October 2021: For orders through Swiggy and Zomato, the platform (not the restaurant) is responsible for collecting and depositing the 5% GST directly to the government. This is called the restaurant services rule under the e-commerce operator category.
What this means for you: - For Swiggy/Zomato orders, you do not collect GST from the customer — the platform does - The platform pays GST on your behalf - You still need to report these sales in your GSTR-1 as outward supplies through e-commerce operators - You cannot claim ITC on these orders regardless
For direct orders (your own website, phone orders, walk-in): - You charge 5% GST directly to the customer - You deposit it yourself when filing GSTR-3B
This dual reporting — platform orders separately from direct orders — requires organised record keeping. GST Maker helps you track your direct sales invoices clearly.
SAC Codes for Food Businesses
| Type of Food Service | SAC Code | GST Rate |
|---|---|---|
| Restaurant services (dine-in, takeaway) | 996331 | 5% (No ITC) |
| Cloud kitchen / food delivery | 996331 | 5% (No ITC) |
| Food truck services | 996331 | 5% (No ITC) |
| Outdoor catering services | 996334 | 18% (With ITC) |
| Hotel restaurant (room tariff below ₹7,500) | 996331 | 5% (No ITC) |
| Hotel restaurant (room tariff ₹7,500+) | 996331 | 18% (With ITC) |
| Bakery (eat-in portion) | 996331 | 5% |
| Packaged bakery items sold separately | 1905 | 5%–18% |
| Canteen services in offices / factories | 996333 | 5% |
| Sweet shop (mithai, namkeen) | 2106 | 5%–12% |
GST Maker's AI Magic Fill suggests the correct SAC code as you type your service type.
How GST Maker Works for Food Businesses
Set Up Your Restaurant Profile
Enter your restaurant or business name, GSTIN, address, and logo once. Auto-fills on every invoice forever.
Create B2B and Catering Invoices Quickly
Most B2C restaurant sales (individual customers eating in or ordering food) do not require individual customer invoices. But for: - Corporate bulk orders — companies ordering food for their office - Catering contracts — weddings, events, corporate functions - Canteen contracts — office or factory canteens - Packaged food distribution — selling to retail stores or distributors
GST Maker creates professional, GST-compliant invoices in under 60 seconds for all of these.
Handle Catering at 18% vs Restaurant at 5%
Save your catering service separately from your restaurant service — each with its own SAC code and correct GST rate. GST Maker ensures the right rate is applied to the right service type every time.
Share on WhatsApp Instantly
For corporate clients and event organisers, send the invoice link on WhatsApp immediately after confirming the order. Clean, professional, and easy to process for their accounts team.
Track Food Business Expenses for ITC (Where Applicable)
If you are an outdoor caterer operating at 18% GST — you can claim ITC on your purchases. GST Maker's Expense Tracker records raw material purchases, equipment costs, and other business expenses with GST amounts for ITC claims.
Generate GSTR-1 Report at Month End
All your B2B and catering invoices organised into a GSTR-1 ready report. Your CA gets clean data — no more searching through WhatsApp orders and cash register tapes.
Real Example — A Catering Business in Delhi
Ananya runs a catering company in Delhi that handles corporate lunches, wedding receptions, and office party catering. Her services are provided at client venues — which makes them outdoor catering at 18% GST.
Her monthly revenue from catering contracts: ₹8–15 lakh.
Before GST Maker: - Catering invoices were typed in Word by her assistant - Applying 18% instead of 5% (the restaurant rate) was a frequent confusion — she had billed some events at the wrong rate - Corporate clients with tight accounting processes often delayed payment because the invoice format was not what their accounts team needed - CA spent hours reconstructing catering invoice records for GSTR-1
With GST Maker: - Catering service saved with SAC 996334 and 18% GST — applied automatically on every catering invoice - Restaurant service (for her small dine-in section) saved separately with SAC 996331 and 5% GST - Corporate clients saved with their GSTIN and state - Delhi NCR clients get CGST + SGST automatically - Out-of-Delhi corporate events get IGST automatically - Invoice share link sent on WhatsApp within 2 minutes of confirming any booking - CA gets a clean GSTR-1 report at month end — filing now takes 45 minutes
Her corporate client payment turnaround improved from 20–25 days to 8–10 days — simply because the invoices were reaching the right person in the right format immediately after booking.
Real Example — A Cloud Kitchen in Bengaluru
FreshBite is a cloud kitchen in Bengaluru operating across Swiggy and Zomato with no dine-in facility. They also take direct WhatsApp orders from office buildings in their area.
Their GST situation: - Swiggy and Zomato orders — GST collected and deposited by the platforms - Direct WhatsApp orders from offices — 5% GST collected and deposited by FreshBite - Monthly corporate lunch contracts with 3 IT offices — proper B2B invoices needed
With GST Maker: - WhatsApp order invoices created quickly with SAC 996331 and 5% GST - Corporate lunch contract clients saved with company GSTIN - Monthly corporate invoices set up as recurring — auto-generated on the 1st of every month - IGST applied automatically for corporate clients with out-of-Karnataka billing address - Direct orders clearly separated from platform orders in their records
Their CA reconciles Swiggy and Zomato TCS data with FreshBite's own direct sales records cleanly every month — no confusion between platform orders and direct orders.
Real Example — A Bakery in Pune
SweetCrust is a bakery in Pune that operates both a café (dine-in customers eating cakes and pastries) and a wholesale distribution business selling packaged bakery items to local supermarkets and gift shops.
Their mixed billing situation: - Café orders — 5% GST on food served in the café - Packaged items sold at the counter — 5% or 12% GST depending on the item (HSN code varies by product) - Wholesale orders to supermarkets — 12% GST on packaged goods with proper B2B invoices
With GST Maker: - Café service saved as restaurant service at 5% (SAC 996331) - Each packaged bakery product saved separately with the correct HSN code and GST rate - Supermarket and gift shop clients saved with their GSTIN - Wholesale invoices with correct item-wise GST breakup — each product's tax calculated separately - GSTR-1 report includes both service invoices and goods invoices — organised cleanly
The owner no longer needs to call her CA every month to figure out which rate applies to which product. GST Maker's saved product list does it automatically.
Common Questions Food Business Owners Ask
Do small dhabas and street food stalls need to register for GST? Only if annual turnover exceeds ₹20 lakhs for services (₹40 lakhs for goods). Most small dhabas and street vendors are well below this threshold and do not need GST registration.
Can a restaurant claim ITC on kitchen equipment or raw materials? Under the 5% restaurant scheme, ITC is blocked — you cannot claim input tax credit on raw materials, kitchen equipment, or other purchases. This is the trade-off for the lower 5% rate. Outdoor caterers operating at 18% can claim ITC.
What is the GST rate on alcohol served in restaurants? Alcohol is outside GST — it is taxed under state excise laws. The food and non-alcoholic beverages served alongside are taxed at the applicable restaurant GST rate.
Does a restaurant need to issue a GST invoice for every customer? For B2C customers (individual walk-in or delivery customers), a simplified invoice or bill of supply is sufficient — you do not need to issue a full tax invoice for every small order. A consolidated B2C invoice for the day is acceptable for GSTR-1 purposes. For B2B clients (corporate orders), a full tax invoice with the buyer's GSTIN is required.
How is Swiggy/Zomato GST different from direct order GST? For Swiggy and Zomato orders, the platform collects and deposits the 5% GST on your behalf. For direct orders, you collect and deposit the GST yourself. Both types need to be reported in your GSTR-1 — platform orders in the e-commerce section, direct orders in the regular outward supplies section.
Frequently Asked Questions (FAQ)
What GST rate does a standalone restaurant charge in India? Most standalone restaurants charge 5% GST (no ITC) on food and non-alcoholic beverages served. This applies whether the restaurant is AC or non-AC.
What is the GST rate for catering services in India? Outdoor catering services — food served at events, weddings, and venues outside the restaurant premises — attract 18% GST with ITC available.
Does a cloud kitchen charge GST? Yes. Cloud kitchens are treated as restaurants and charge 5% GST on direct orders. For orders through Swiggy and Zomato, the platform deposits the GST on the cloud kitchen's behalf.
Is GST Maker free for restaurants and food businesses? Yes. All core features — B2B invoices, catering invoices, recurring contracts, client management, expense tracking, and GSTR-1 reporting — are part of GST Maker's free plan.
Can I use GST Maker for both restaurant and catering billing? Yes. Save your restaurant service and catering service separately with their respective SAC codes and GST rates (5% for restaurant, 18% for catering). GST Maker applies the correct rate automatically based on which service you select.
Serve Great Food. Bill Professionally. For Free.
Running a food business in India is hard work. Your billing should not add to that stress. GST Maker gives restaurant owners, cloud kitchens, catering companies, and bakeries a free, AI-powered billing system that handles the correct GST rates, SAC codes, and GSTR-1 reporting automatically.
Free. Simple. Built for Indian food businesses.
No credit card. No complicated setup. Your first food business invoice in 60 seconds.
