If you run a guest house, a lodge, a homestay or a resort, almost every GST article you find is written about hotels, and it is never quite clear whether it applies to you. So here is the part nobody says plainly enough: it does. The rate does not care what you call the property.
A caveat before the detail: GST positions get amended and clarified, so treat this as orientation and confirm your own case with your accountant.
One test, whatever the sign says
Guest house, lodge, inn, homestay, service apartment, resort, boutique property: for GST on accommodation they all run through the same test, applied per room, per night, on the amount you actually charge.
- ₹7,500 or below per night → 5% GST, without input tax credit.
- Above ₹7,500 per night → 18% GST, with input tax credit.
That is the whole rate decision. There is no separate guest-house rate, no lodge rate, no resort rate. Star rating does not enter into it and neither does property category, which is a change from the older system that keyed off declared tariff and class. Our full guide to GST on hotel rooms works through the slabs and the history in more detail.
The two traps that catch small properties
Trap one: assuming cheap rooms are exempt. They were, once. A room at ₹1,000 or below per night was outside GST entirely until 18 July 2022, when that exemption was withdrawn. Plenty of lodges and guest houses are still running invoice templates written before that date. A ₹600 room is taxable now, at 5%. It is a small number per night and a large number across three years of nights.
Trap two: assuming your band is fixed. Because the test uses the price actually charged rather than a published tariff, your own rate calendar moves nights across the ₹7,500 line. A resort villa at ₹8,200 in season is an 18% night; discount it to ₹7,200 in the monsoon and the same room becomes a 5% night, and it also stops carrying input tax credit. Seasonal properties cross this line constantly without noticing, and the front desk is usually the last to know.
Stop deciding the tax rate by hand
Sukoon reads the rate you actually charged for that night, applies the right slab, and produces a compliant GST invoice. Seasonal pricing stops being a compliance risk.
See Sukoon's GST billingDo you have to register at all?
None of the above applies until you are registered. Below the turnover threshold for your state there is no registration and no GST on the tariff, which is where a genuinely small homestay sits.
The thing to watch is that turnover is not always what forces the decision. Listing on an online travel agent tends to bring the question forward, both through the platform's own requirements and through the commission invoices coming back at you. If you are weighing that up, the OTA relationship is worth understanding on its own terms first: see OTA versus direct booking and how to reduce OTA commissions.
What the food bill does
If you serve meals, that line is not taxed like the room. Restaurant service inside the property has its own rate, and which one you charge depends on whether any unit in the property crossed ₹7,500 a night in the preceding financial year. A guest house that added one premium suite can quietly move its whole F&B operation into the higher band. The detail is in GST on restaurant food inside hotels.
Get the invoice right
Charging the correct rate and then issuing a document that will not stand up is a common way to undo the work. A compliant tax invoice needs your GSTIN, the guest or company details where the guest wants to claim, the room and F&B lines shown separately, and the CGST and SGST split rather than a single lump. Our hotel GST invoice format guide has the full list, and if a corporate guest asks whether they can claim your GST back, the answer is usually no and here is why.
FAQs
What is the GST rate on a guest house in India?
The same rates that apply to a hotel. Room rent at ₹7,500 or below per night attracts 5% GST without input tax credit; above ₹7,500 per night attracts 18% with input tax credit. Calling the property a guest house rather than a hotel does not put it in a different bracket. The rate follows the price of the room night, not the name over the door.
What GST rate applies to lodge rent?
A lodge charges GST on the same per-night value test as any other accommodation: 5% at ₹7,500 or below, 18% above it. Most lodges sit entirely in the 5% band. The point that catches people out is that 5% is not zero, and rooms under ₹1,000 stopped being exempt in July 2022, so a ₹600 lodge room is taxable today.
Is GST applicable on resort bookings?
Yes, on the same slabs as hotels, and resorts are the property type most likely to cross ₹7,500 on a room night. The test is applied per room per night on the actual amount charged, so the same resort can bill 5% on a garden room in the off season and 18% on a villa in peak season. Season and discounting move nights across the line.
Do homestays have to charge GST?
Only once registration is required. Below the turnover threshold there is no GST registration and so no GST on the tariff. Above it, a homestay charges the same accommodation rates as a hotel. Selling through an online travel agent is where small properties are most often surprised, because the platform's own compliance requirements can force the question earlier than turnover alone would.
Does the star rating or category of the property change the GST rate?
No. The old system keyed the rate to declared tariff and property class; the current one keys it to the actual value charged for that room on that night. An unrated lodge charging ₹9,000 in peak season is in the 18% band, and a three-star hotel discounting to ₹5,000 is in the 5% band. The category is irrelevant to the calculation.
Do I charge GST on the discounted price or the rack rate?
The price actually charged. The 'declared tariff' test was replaced by the transaction value, which is why a discount can genuinely move a night from the 18% band into the 5% band. It also means your rate calendar quietly decides your tax rate every night, which is an argument for having the system apply it rather than the front desk.