As of the effective date of rate, 1st July 2017, the GST rate for hotel rooms in India is 12% for rooms with a tariff of ₹1,000 to ₹7,499 per night, while rooms with a tariff of ₹7,500 and above per night are taxed at 18%. The relevant HSN/SAC code for hotel rooms is 9963.
The GST rate for hotel rooms is as follows:
| HSN/SAC Code | Description | GST Rate | Effective Date |
|---|---|---|---|
| 9963 | Accommodation in hotels, inns, guest houses, clubs, campsites or other commercial places | 12% / 18% | 1st July 2017 |
To calculate the total GST amount for a hotel room, you can use our calculator widget:
function calculateGST() { var basePrice = document.getElementById("basePrice").value; var gstRate = 0.12; // default GST rate if (basePrice >= 7500) { gstRate = 0.18; } var gstAmount = basePrice * gstRate; document.getElementById("gstAmount").innerHTML = "Total GST Amount: ₹" + gstAmount.toFixed(2); }Under the GST regime, hotel rooms can be taxed under either the composition scheme or the regular scheme. The composition scheme is a simplified tax scheme for small businesses, where the tax rate is lower, but the business is not eligible for input tax credit.
The regular scheme, on the other hand, allows businesses to claim input tax credit, but the tax rate is higher. The following table compares the tax rates under the composition scheme and the regular scheme:
| Scheme | HSN/SAC Code | Description | GST Rate |
|---|---|---|---|
| Composition Scheme | 9963 | Accommodation in hotels, inns, guest houses, clubs, campsites or other commercial places | 1% / 5% |
| Regular Scheme | 9963 | Accommodation in hotels, inns, guest houses, clubs, campsites or other commercial places | 12% / 18% |
It is essential to note that the composition scheme is only available for businesses with an annual turnover of up to ₹1.5 crore. Businesses with an annual turnover above ₹1.5 crore must opt for the regular scheme.
Prior to the introduction of GST, hotel rooms were taxed under the state-specific value-added tax (VAT) and service tax. The tax rates varied across states, with VAT rates ranging from 4% to 15% and service tax at 15%.
The following table compares the tax rates under the pre-GST regime and the GST regime:
| Tax Regime | HSN/SAC Code | Description | Tax Rate |
|---|---|---|---|
| Pre-GST Regime (VAT + Service Tax) | 9963 | Accommodation in hotels, inns, guest houses, clubs, campsites or other commercial places | 4% - 15% (VAT) + 15% (Service Tax) |
| GST Regime | 9963 | Accommodation in hotels, inns, guest houses, clubs, campsites or other commercial places | 12% / 18% |
The GST regime has simplified the tax structure, with a single tax rate applicable across the country. However, the tax rates under the GST regime are higher than the pre-GST regime for certain categories of hotel rooms.
Q: Can I claim input tax credit for GST paid on hotel rooms?
A: Yes, you can claim input tax credit for GST paid on hotel rooms, provided you have a valid GST invoice and the rooms are used for business purposes.
Q: What are the compliance requirements for hotel rooms under the GST regime?
A: The compliance requirements for hotel rooms under the GST regime include obtaining a GST registration, filing GST returns, and maintaining accurate records of GST invoices and payments.
Q: What are the common billing mistakes associated with hotel rooms under the GST regime?
A: Common billing mistakes associated with hotel rooms under the GST regime include incorrect GST rates, missing GST invoices, and failure to claim input tax credit.
To avoid these mistakes, it is essential to ensure that your billing process is accurate and compliant with the GST regulations. Our compliance tips section provides more information on how to avoid common billing mistakes.
To ensure compliance with the GST regulations, it is essential to follow these tips:
By following these tips, you can avoid common billing mistakes and ensure compliance with the GST regulations for hotel rooms in India.
12%
18%
9963
1st July 2017
Accommodation
