GST Billing for Restaurants in India: A Simple Guide

GST billing trips up a lot of café and restaurant owners in India — not because the tax is complicated, but because the rules are scattered across notifications, FAQs, and word-of-mouth from your neighbour's accountant. Get one detail wrong on a printed bill and you risk an unhappy customer, a flagged return, or input credit you can't claim. This guide pulls the practical essentials into one place: which GST rate applies to your restaurant, what a compliant tax invoice must actually show, when you're required to register, and how a billing app takes the manual work off your plate.

A quick but important caveat first: GST rates, thresholds, and rules change through notifications and council decisions, and your exact situation can depend on your turnover, state, and whether you serve alcohol or operate inside a hotel. Treat this as a clear starting point, not legal or tax advice — always confirm the current GST rules with a qualified Chartered Accountant or the official GST portal before you finalise how you bill.

Which GST rate applies to your restaurant?

For most standalone restaurants and cafés, the headline number to remember is 5% GST with no input tax credit (ITC) — that's the standard rate for restaurant service whether you offer dine-in, takeaway, or delivery. The trade-off for the lower rate is that you cannot claim credit for the GST you pay on your own purchases (rent, equipment, ingredients), so you don't net that against your output tax.

The picture changes if your restaurant is located inside a hotel where the declared room tariff crosses the specified threshold — there, restaurant service is generally taxed at 18% with ITC available. Alcoholic beverages sit outside GST entirely and are taxed under state VAT/excise, so if you serve liquor you'll often run two tax treatments on the same bill. Because these slabs and the hotel-tariff threshold are exactly the kind of thing that gets revised, verify the current figures for your category before printing anything.

• Standalone restaurant / café (dine-in, takeaway, delivery): typically 5% GST, no input tax credit.
• Restaurant inside a high-tariff hotel: typically 18% GST, with input tax credit.
• Alcohol: outside GST — charged under state VAT/excise, shown separately on the bill.
• Always reconfirm the exact rate and threshold for your case — these change via GST notifications.

CGST, SGST and IGST — what those lines mean

When you see 5% GST, it's almost never one line on a restaurant bill. For a sale within your own state — which is the case for nearly all dine-in and local takeaway — the tax splits into two equal halves: CGST (Central GST) and SGST (State GST). So a 5% rate shows as 2.5% CGST + 2.5% SGST, and an 18% rate shows as 9% CGST + 9% SGST. The customer pays the same total; the split simply records how the revenue is shared between the centre and your state.

IGST (Integrated GST) applies to inter-state supply and is rarely relevant to in-person dining, but it can appear for some delivery or catering arrangements that cross state lines. The practical takeaway for a café owner: your bill should print CGST and SGST as separate, clearly-labelled lines with their own amounts, not a single lumped 'GST' figure — that separation is part of what makes the invoice compliant.

What a GST-compliant restaurant invoice must show

A compliant tax invoice has a set of mandatory fields. The fastest way to audit your current bills is to print one and tick off the list below. Missing a field doesn't just look unprofessional — it can prevent a business customer from claiming input credit and can be a problem at filing time.

• Your business name, address, and GSTIN (your 15-digit GST registration number).
• A unique, sequential invoice number and the invoice date.
• Description of items served (or your menu items), with quantity and rate.
• Taxable value, then CGST and SGST shown as separate lines with their rates and amounts.
• The total invoice value, ideally in figures (and in words for larger bills).
• HSN/SAC code where applicable for your turnover bracket.
• Customer's name and GSTIN if they request a bill for input credit (a B2B sale).

When does a restaurant need GST registration?

You're required to register for GST once your aggregate annual turnover crosses the prescribed threshold — broadly ₹20 lakh for service providers in most states, with a lower ₹10 lakh limit in certain special-category states. Some businesses also register voluntarily below the threshold, for example to issue GST invoices that larger corporate clients expect for their catering or events.

Below the threshold you may not need to charge GST at all, and a small eatery sometimes opts for the composition scheme, which uses a flat lower rate but bars you from collecting GST from customers or claiming credit. Thresholds and scheme conditions are revised periodically and vary by state, so confirm where you stand with your CA before deciding whether — and how — to register. Once registered, you must file your GST returns on schedule, which is far easier when your billing data is already clean and exportable.

How a POS automates GST-compliant billing

Calculating CGST and SGST by hand on every bill during a lunch rush is exactly how mistakes creep in. A good restaurant POS does it for you: set the correct rate against each menu item once, and every bill prints the taxable value, the split tax lines, and your GSTIN automatically — with sequential invoice numbers you never have to track manually. That consistency is what keeps your records ready for return filing.

BillMithra is one example built for this: it's an offline-first billing app for Indian cafés and restaurants, so it keeps generating correct GST bills even when your internet drops mid-service, then syncs across your devices once you're back online. You can assign GST rates per item, print or share compliant invoices, run KOTs to the kitchen, and sync across multiple devices on plans starting free, with Lite at ₹199/month, Starter at ₹399/month (1 device), Standard at ₹699/month (3 devices), and Professional at ₹999/month (6 devices), with a 30-day free trial to try it on your real menu. If you're still weighing options, our guide on the best POS billing app for cafés and restaurants walks through how to compare them, and Why offline POS billing matters explains why working without internet is non-negotiable during a rush.

Common GST billing mistakes to avoid

• Printing a single lumped 'GST' line instead of separate CGST and SGST amounts.
• Applying 18% when your standalone restaurant should be at 5% (or vice-versa) — confirm your category.
• Trying to claim input tax credit while billing at the 5% no-ITC rate.
• Skipping or duplicating invoice numbers, which breaks the sequential record.
• Leaving your GSTIN off the bill, so business customers can't claim credit.
• Mixing alcohol into the GST total instead of charging it separately under state tax.
• Relying on memory for rates during a rush — set them once in your POS and let it do the maths.