GST Billing for Travel Agents and Tour Operators in India — Complete Guide
The travel industry in India is booming. Domestic tourism is at record highs. International travel is back in full force. Travel agents, tour operators, and holiday package companies are busier than ever.
But for travel business owners, GST compliance is genuinely confusing. Different rates for different services. TCS on travel packages. Domestic vs international tour rules. Hotel bookings vs airline tickets vs your own service fee — each has its own GST treatment.
Get it wrong and your clients face ITC problems. Get it wrong repeatedly and the GST department notices.
This guide explains everything clearly — the correct GST rates for every travel service, SAC codes, TCS rules, and how GST Maker makes your billing professional and compliant.
GST on Travel Services — The Complete Breakdown
Travel businesses deal with multiple types of transactions, each with different GST treatment. Here is the full picture:
Your Own Service Fee / Commission
When you charge a client a service fee or earn a commission for booking flights, hotels, or holidays — that is your primary income as a travel agent.
Your service fee is taxable at 18% GST under SAC 998551 (travel agent and tour operator services).
This is the most straightforward part. Whatever you charge as your service fee, markup, or commission — 18% GST applies.
Tour Packages (Domestic)
If you sell a complete domestic tour package — which includes accommodation, transport, sightseeing, and meals bundled together — the entire package is taxable at 5% GST (no ITC).
This is the same treatment as restaurants — lower rate but no input tax credit on the components you purchase to build the package.
Tour Packages (International)
If you sell an international tour package to a client traveling outside India — the GST treatment is 0% (zero-rated) if the tour is entirely outside India and the services are consumed abroad.
However, if the package includes any services within India (pre-departure hotel, domestic leg of the journey, etc.), the India portion may attract GST.
Hotel Booking Commission
When you book hotels for clients and earn a commission from the hotel — that commission is your income and is taxable at 18% GST.
The hotel booking itself (what the client pays to the hotel) is between the client and the hotel. Your commission for facilitating it is a separate taxable service.
Flight Ticket Booking
Airlines charge GST on tickets — economy at 5%, business class at 12%. As a travel agent, you do not charge GST on the ticket price itself. You charge GST only on your service fee or commission for booking the ticket.
Visa Services
If you provide visa assistance and documentation services as a travel agent — this is a service taxable at 18% GST.
Travel Insurance Commission
Insurance commissions are taxable at 18% GST.
TCS (Tax Collected at Source) for Tour Operators
Under Income Tax (not GST), tour operators selling packages above ₹7 lakh per person are required to collect 5% TCS (Tax Collected at Source) from their clients under Section 206C(1G) of the Income Tax Act.
This is an Income Tax provision — not GST. But it appears on your invoice and affects the final amount your client pays.
How it works: - Client books a tour package worth ₹10,00,000 - TCS at 5% = ₹50,000 - Total invoice amount = ₹10,50,000 (plus GST on your service fee)
The TCS collected is deposited with the Income Tax department. Your client gets credit for it when filing their ITR.
Note: This TCS rule applies only when the tour cost per person exceeds ₹7 lakh. For smaller packages, TCS does not apply.
SAC Codes for Travel and Tourism Businesses
| Service | SAC Code | GST Rate |
|---|---|---|
| Travel agent service fee / commission | 998551 | 18% |
| Tour operator services (domestic package) | 998552 | 5% (No ITC) |
| Tour operator services (international package) | 998552 | 0% (if fully outside India) |
| Hotel booking commission | 998551 | 18% |
| Car rental and cab arrangements | 996601 | 5% (non-AC) / 12% (AC) |
| Visa assistance services | 998551 | 18% |
| Travel insurance facilitation | 997137 | 18% |
| Event and MICE travel management | 998596 | 18% |
| Pilgrimage tour packages (domestic) | 998552 | 5% |
GST Maker's AI Magic Fill suggests the correct SAC code as you type your service description.
How GST Maker Works for Travel Agents and Tour Operators
Set Up Your Agency Profile
Enter your travel agency name, GSTIN, address, logo, and bank details once. Auto-fills on every invoice forever.
Save Different Service Types Correctly
Save your standard services separately — domestic package, international package, visa service, hotel commission — each with its own SAC code and correct GST rate. AI Magic Fill ensures the right rate is applied automatically.
Handle Corporate Travel Clients
Corporate travel accounts are your highest-value clients. Save them with their company GSTIN, billing address, and state. GST Maker applies CGST + SGST for same-state clients and IGST for out-of-state corporate accounts automatically.
Create Detailed Tour Package Invoices
For package tours, add multiple line items — accommodation, transport, sightseeing, meals — on one invoice with the overall 5% GST rate. For clients who need a detailed breakup, GST Maker supports itemised invoices with clear descriptions.
Share on WhatsApp or Email Instantly
After confirming a booking, send the invoice link on WhatsApp immediately. Corporate clients can forward it to their accounts team for processing. Individual clients have a professional record of their booking on their phone.
Recurring Invoices for Corporate Travel Contracts
If you manage travel for a corporate client on a monthly retainer or regular basis, set up recurring invoices. GST Maker auto-generates them on schedule — no manual work each month.
Track Business Expenses for ITC (On 18% Services)
For services where you charge 18% GST (your commission and service fee), you can claim ITC on your business expenses. GST Maker's Expense Tracker records these purchases with GST amounts for monthly ITC claims.
Real Example — A Travel Agency in Mumbai
Horizon Holidays is a travel agency in Mumbai handling both domestic and international travel for individual clients and corporate accounts. They sell package tours, book flights and hotels, assist with visas, and provide travel insurance.
Their billing complexity: - Service fee on flight/hotel bookings — 18% GST - Domestic tour packages — 5% GST - Visa assistance — 18% GST - Corporate travel management — 18% GST on their management fee - International packages — 0% GST (when fully outside India)
Before GST Maker: - Different invoices were created with different templates for different service types - Applying the correct GST rate (5% vs 18% vs 0%) was frequently confusing for the billing staff - Corporate clients delayed payment because invoice formats were inconsistent - CA spent 4–5 hours every month sorting through different invoice types for GSTR-1
With GST Maker: - All service types saved separately with correct SAC codes and GST rates - Staff select the service type — rate is applied automatically — no confusion - Mumbai corporate clients get CGST + SGST automatically - Out-of-Mumbai and out-of-Maharashtra corporate clients get IGST automatically - Invoice share links sent to all clients on WhatsApp immediately after booking confirmation - CA gets a clean GSTR-1 report in 2 minutes at month end
Wrong GST rate invoices dropped to zero after switching. Corporate client payment turnaround improved from 20+ days to under 10 days.
Real Example — A Tour Operator in Jaipur
RoyalRajasthan Tours is a tour operator in Jaipur specialising in Rajasthan heritage tours, desert safaris, and palace hotel packages. Their clients include Indian tourists, NRI groups, and foreign tourists.
Their GST situation: - Domestic Rajasthan packages — 5% GST - Inbound international tourists (foreigners coming to India) — GST applies at 5% on the India portion of their tour package - Corporate group tours and MICE events — 18% GST on their management/coordination fee
Before GST Maker: - Tour package invoices were created in Word with manual tax calculations - NRI and foreign client invoices were particularly confusing — figuring out IGST vs no GST was unclear - Group bookings with 30+ participants needed itemised invoices that took hours to prepare
With GST Maker: - Domestic package invoices at 5% — one click, AI fills everything - Corporate MICE event invoices at 18% — saved as a separate service type - Client GSTIN and state saved — CGST + SGST for Rajasthan clients, IGST for out-of-state - Group tour invoices with participant count and per-person pricing — created in under 5 minutes regardless of group size
Their MICE business — which requires formal GST invoices for corporate procurement — has grown significantly because billing is now fast, professional, and compliant.
Real Example — A Solo Travel Consultant in Bengaluru
Kavitha is a solo travel consultant in Bengaluru who plans customised international holidays for high-net-worth clients. She earns a combination of supplier commissions and direct service fees from clients.
Her annual income: ₹22–28 lakhs — GST registration mandatory.
Her billing: - Service fee to clients for planning international holidays — 18% GST - Commission invoices to hotels and resorts for referrals — 18% GST - Domestic getaway packages for local clients — 5% GST
With GST Maker: - International holiday planning fee invoiced with SAC 998551 at 18% - Commission invoices to hotels — same SAC code, IGST for out-of-Karnataka hotels - Domestic packages at 5% — separate service saved in her product list - Proforma invoice sent to clients before trip payment — converts to tax invoice after travel completion - Monthly GSTR-1 report ready in 2 minutes — she files her own returns without a CA
Kavitha saves ₹15,000–20,000 per year in CA fees by handling her own billing and return filing using GST Maker's organised reports.
GST Invoicing Tips for Travel Businesses
Always separate your service fee from the package cost on the invoice. Your service fee (18% GST) and the package (5% GST) should be clearly shown as separate line items. This avoids confusion about why different rates appear on the same invoice.
For corporate clients — send the invoice before the trip, not after. Corporate accounts teams process invoices in advance. If the invoice arrives after the trip, it misses the payment cycle and you wait another month.
Keep TCS documentation separate from GST invoices. TCS under Income Tax and GST are different requirements. Note TCS separately on your invoice — do not mix it into the GST calculation.
For international packages — clearly mark "0% GST — Export of Services" on the invoice to avoid confusion. Your client may expect GST to appear and be confused when it does not.
Verify every corporate client's GSTIN before creating their invoice. A wrong GSTIN causes ITC problems for your client and a GSTR-2B mismatch for you. GST Maker saves verified GSTINs once — eliminating this risk on repeat bookings.
Frequently Asked Questions (FAQ)
What GST rate does a travel agent charge in India? A travel agent's service fee or commission is taxable at 18% GST under SAC 998551. Domestic tour packages are 5% GST. International packages consumed entirely outside India are 0% GST.
Is GST charged on airline tickets? Yes. Airlines charge 5% GST on economy tickets and 12% on business class tickets. As a travel agent, you do not charge GST on the ticket price — only on your service fee for booking the ticket.
What is TCS on travel packages and when does it apply? TCS (Tax Collected at Source) under Income Tax applies when a travel package exceeds ₹7 lakh per person. You collect 5% TCS from the client and deposit it with the Income Tax department. This is separate from GST.
Does GST apply to international tour packages sold by Indian agents? If the tour is entirely outside India and the services are consumed abroad, the package is zero-rated (0% GST). If any part of the service is consumed in India, that portion may attract GST.
Can travel agents claim ITC? For services charged at 18% (your commission and service fee), ITC is available on your business expenses. For the 5% domestic package scheme, ITC is blocked — similar to the restaurant rule.
Is GST Maker free for travel agents and tour operators? Yes. All core features — tax invoices, proforma invoices, recurring invoices, client management, expense tracking, and GSTR-1 reporting — are part of GST Maker's free plan.
Book More Trips. Bill Professionally. For Free.
Your clients choose you because you make travel effortless. Your billing should be just as effortless — fast, professional, GST-compliant, and sent on WhatsApp before the client even gets home.
GST Maker gives every travel agent and tour operator in India a free, AI-powered billing system that handles the correct GST rates for every service type automatically.
Free. AI-powered. Built for Indian travel businesses.
No credit card. No complicated setup. Your first travel invoice ready in 60 seconds.
