Catering services are an essential part of the Indian hospitality industry, providing food and beverage services to various events, parties, and functions. With the introduction of the Goods and Services Tax (GST) in India, catering services have been brought under the GST regime. In this article, we will discuss the GST rate and HSN code for catering services, the tax breakdown, comparison with the pre-GST tax regime, and frequently asked questions regarding input tax credit and compliance.
Catering services are classified under SAC 9963 (Accommodation, food and beverage services) and attract 5% GST (2.5% CGST + 2.5% SGST) without input tax credit, except when supplied at "specified premises", where the rate is 18% with input tax credit. The 5% rate has applied since 1 October 2019. The service code is SAC 9963 (heading "Accommodation, food and beverage services"); at six digits, outdoor and event catering is 996334 and restaurant service inside the restaurant's own premises is 996331. Services are classified by SAC, not HSN.
| HSN Code | Description | GST Rate (%) | Effective Date |
|---|---|---|---|
| 9963 (Sl. No. 7(iv)/(v)) | Catering / outdoor catering, and catering with venue — premises other than specified premises | 5 (no ITC, mandatory) | 1st October 2019 |
| 9963 (Sl. No. 7(vi)) | Catering / outdoor catering at specified premises | 18 (with ITC) | 1st October 2019 |
The tax breakdown for catering services in India is as follows:
Catering services can opt for either the composition scheme or the regular scheme under GST. The composition scheme is a simplified scheme for small taxpayers, where the taxpayer pays a fixed percentage of their turnover as tax. The regular scheme, on the other hand, requires the taxpayer to pay tax on the value of the supply.
| Scheme | GST Rate (%) | Turnover Limit (INR) |
|---|---|---|
| Composition Scheme | 5 | 1.5 crores |
| Regular Scheme | 5 (no ITC) or 18 (with ITC at specified premises) | No limit |
Before the introduction of GST, catering services were subject to a complex system of taxes, including service tax, value-added tax (VAT), and luxury tax. The pre-GST tax regime had a tax rate of around 15-20% for catering services. Catering other than at "specified premises" — which covers outdoor, wedding, event, marriage-hall and contract catering by any caterer who neither supplies hotel accommodation at, nor is located in, "specified premises" — is taxed at 5% without input tax credit under Sl. No. 7(iv)/(v) of Notification No. 11/2017-Central Tax (Rate). That 5% rate is mandatory: the caterer cannot choose to pay 18% with ITC instead. Catering supplied at "specified premises" is taxed at 18% with ITC under entry 7(vi). Food supplied inside a restaurant's own premises is restaurant service and follows the same 5% without-ITC / 18% with-ITC split.
To calculate the GST amount for catering services, you can use the following calculator widget:
function calculateGST() { var basePrice = document.getElementById("base-price").value; var gstRate = 0.18; var gstAmount = basePrice * gstRate; document.getElementById("gst-amount").innerHTML = "GST Amount: " + gstAmount.toFixed(2) + " INR"; }Q: Can I claim input tax credit for goods and services used in providing catering services?
A: Yes, you can claim input tax credit for goods and services used in providing catering services, subject to certain conditions and restrictions.
To avoid common billing mistakes associated with catering services, follow these compliance tips:
In conclusion, catering services in India are subject to a GST rate of 18% and an HSN code of 9963. The tax breakdown for catering services depends on the scheme opted for, either composition or regular. The pre-GST tax regime had a complex system of taxes, which has been simplified with the introduction of GST. By following the compliance tips and using the calculator widget, catering service providers can ensure accurate billing and compliance with GST regulations.
18%
9963
No
On the total bill value
Yes
Related: GST on banquet halls and the full list of GST rate guides by sector.
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