GST Billing for Hotels in India — 2026 Compliance Guide
GST compliance for Indian hotels is more nuanced than most other industries. Rates differ by room tariff, F&B splits must be accurate, foreign guests trigger special rules, and e-invoicing obligations grow as your revenue scales. Get GST right and your hotel saves lakhs in penalties and ITC losses every year. Get it wrong and you face notices, interest, and disputes.
GST Rates & Slabs for Hospitality
Room tariff slabs. 12% GST applies to room tariffs up to ₹7,500 per night. 18% GST applies to rooms above ₹7,500 per night. The rate is based on declared tariff, not discounted rate — which matters when you run promotional pricing.
Restaurant/F&B slabs. Restaurants in hotels with room tariff under ₹7,500 attract 5% GST (without ITC). Restaurants in hotels with tariff above ₹7,500 attract 18% GST (with ITC). Room service follows the same rules. Alcohol is outside GST and follows state excise.
Banquet & event slabs. Banquet rentals and event services attract 18% GST. Bundled wedding/event packages require careful invoice splitting — rooms at room slab, F&B at F&B slab, hall rental at 18%.
Anatomy of a GST-Compliant Hotel Invoice
Every GST invoice has mandatory fields that tax officers will check. Get any of these wrong and your invoice is invalid.
Mandatory Fields
Hotel name + address + GSTIN, invoice number (unique, sequential), invoice date, guest name + address, guest GSTIN if business guest.
HSN/SAC Codes
SAC 996311: Hotel accommodation. SAC 996332: Restaurant in hotels. SAC 996334: Hall rentals for events. Use the right code for each line.
IGST vs CGST/SGST
Guest from your state = CGST + SGST. Guest from another state = IGST. Foreign guest = IGST. Wrong split triggers notice from tax department.
Line-Item Splits
Room charges, F&B charges, banquet charges all need separate lines with their own GST rates. Bundled invoices invite scrutiny.
Tax Calculation
Taxable value, GST rate, GST amount per line, total. Round-off rules matter — most automation handles this; manual processes get it wrong.
Reverse Charge
Foreign OTA commissions trigger reverse charge — hotel pays GST on commission. Frequently missed; recovery as ITC also frequently missed.
Three GST Mistakes Most Hotels Make
Wrong slab for room upgrades. A guest booked at ₹6,000 (12% slab) is upgraded to a suite actually priced ₹9,000 (18% slab). Many hotels bill at 12% for the whole stay. Correct approach: the slab follows the declared tariff of the room occupied, not booked.
F&B and room charges not split correctly. Breakfast included in room package must still be split on the invoice — room at room slab, breakfast at F&B slab. Combining everything under 'room with breakfast' at room slab is a common error costing hotels ITC and inviting scrutiny.
Foreign guest billing errors. Foreign guests can be billed in foreign currency, but GST still applies. You need passport capture, Form C filing, and proper documentation for any export-of-services claim (specific conditions — don't assume).
GST That Just Works
Exceed auto-assigns the right GST slab, splits F&B correctly, and generates GSTR-ready reports. No manual work.
Indian Hotel GST Filing Calendar
Mark these dates to avoid late-filing penalties.
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Monthly Returns
GSTR-1 by 11th of next month (outward supplies). GSTR-3B by 20th of next month (summary + tax payment). Late filing: ₹50/day for nil, ₹100/day for normal returns + 18% interest on unpaid tax.
Annual Returns
GSTR-9 annual return by 31st December for previous fiscal year. Reconciles 12 months of GSTR-1 and GSTR-3B. Manual preparation is painful — automated PMS exports save weeks.
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E-Invoicing Threshold
Hotels with aggregate turnover above ₹5 crore must generate e-invoices for B2B transactions. Threshold has been dropping — plan for it. See GST billing software.
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Maximizing OTA Commission ITC Recovery
Most hotels significantly under-claim ITC on OTA commissions. The math:
₹5 crore annual revenue × 20% OTA share = ₹1 crore OTA bookings.
₹1 crore × 18% commission = ₹18 lakh OTA commissions.
₹18 lakh × 18% GST = ₹3.24 lakh GST paid (eligible as ITC).
Many hotels miss claiming this ITC because OTA invoices come in foreign currency, are routed through complex billing structures, or fall under reverse charge confusion. Audit 24 months back — most hotels recover ₹2–8 lakh in unclaimed ITC. Pair with proper hotel accounting software for India for clean reconciliation.
Related Reading
Other resources for GST and hotel finance.
Frequently Asked Questions
Common questions about GST billing for Indian hotels
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What is the GST rate for hotel rooms in India?
Hotel rooms with declared tariff up to ₹7,500 per night attract 12% GST. Rooms above ₹7,500 attract 18%. The rate follows the declared tariff of the room occupied, not the discounted rate or originally booked tariff.
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What's the GST rate for hotel restaurants?
Restaurants in hotels with room tariff under ₹7,500 attract 5% GST (without ITC). Restaurants in hotels with tariff above ₹7,500 attract 18% GST (with ITC). Room service charges through hotel F&B follow the same rules.
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When is e-invoicing mandatory for hotels?
As of 2026, hotels with aggregate turnover above ₹5 crore must generate e-invoices for B2B transactions. The threshold has been dropping over years — plan for compliance even if you're below today. B2C invoices (walk-in tourists, most bookings) don't require e-invoicing.
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How do I claim ITC on foreign OTA commissions?
Foreign OTAs (Booking.com, Expedia, Agoda) charging commission trigger reverse charge — your hotel pays GST on behalf of the OTA. The GST you pay is then eligible as input tax credit. Most hotels miss this; audit the past 24 months — recovery is typically ₹2–8 lakh.
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Does Exceed handle GST automatically?
Yes — auto-slab assignment based on actual tariff, F&B GST splits, state-wise IGST vs CGST/SGST, GSTR-1 ready exports, native Tally sync. See our GST billing software page or start free trial.
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