GST for Restaurants and Food Businesses: The Basics

Food businesses live under special GST rules — concessional rates, restricted credit and platform-specific twists that catch new owners off guard.

The core structure

Restaurant service is generally taxed at a concessional rate without input tax credit — you cannot offset the GST paid on rent, equipment or supplies against your output tax. Certain premium settings (like restaurants in higher-tariff hotels) follow different treatment as notified.

Ordering platforms changed the game

For supplies through food delivery apps, the platform itself is made liable to pay the tax on restaurant services as per current provisions — but your reporting obligations remain, and reconciliation between your books, the app’s statements and your returns is essential.

Points owners routinely miss

• Packaged and branded items sold over the counter may follow goods rates, not restaurant-service treatment
• Aggregate turnover includes all outlets under one PAN
• The composition option exists for eligible small food businesses — with its own conditions

We keep restaurant clients compliant and reconciled — accounting + GST filing. Talk to us.