The room is not the only thing GST touches in a hotel. Every meal, every bottle of water, every banquet order carries its own tax rules, and they are not the same as the room's. Get the F&B classification wrong and you either overcharge guests or invite a GST notice. Here is how restaurant and food billing actually works in an Indian hotel.
Restaurant service is its own supply
Under GST, accommodation and restaurant service are two separate supplies. The room is taxed on its tariff slab; the restaurant is taxed under the food-service rules. That means you cannot just apply the room's rate to a plate of food, or fold the meal into the room line. They are billed separately, each with its own rate.
The rate: 5% or 18%
Standalone restaurant service is generally taxed at 5% without input tax credit. But there is a catch specific to hotels: if the property has any room tariff above the notified premium threshold, its restaurant is taxed at 18% with input tax credit. In other words, your room pricing can decide your F&B rate, so the two have to be tracked together.
Why the input-credit difference matters
The 5% rate comes without input tax credit; the 18% rate allows it. So the classification affects both what you charge the guest and what you can claim back on your own purchases. Getting it wrong is not just a compliance risk, it is money on the table.
Stop hand-calculating F&B tax
Sukoon bills room and restaurant as separate supplies, applies the right GST rate to each, and prints a clean, compliant invoice with the correct CGST/SGST split. Built for independent Indian hotels.
See Sukoon billingBill F&B the right way
Show food and beverage as a separate line or a separate invoice from the room, each with its own HSN/SAC, the correct rate, and the CGST and SGST shown separately. Never merge F&B into the room charge. For the room side and the invoice format, see our guides on GST on hotel rooms and the hotel GST invoice format. When in doubt on the premium threshold, confirm with your CA, the rules shift, and this article is general guidance, not tax advice.
FAQs
What is the GST rate on restaurant food in a hotel?
Standalone restaurant service is generally taxed at 5% without input tax credit. However, restaurants located in hotels where any room tariff crosses the notified premium threshold are taxed at 18% with input tax credit. So the room tariff in the same property can decide the F&B rate, which is why the two must be billed and tracked correctly.
Why is hotel restaurant GST different from the room GST?
Because accommodation and restaurant service are two different supplies under GST, each with its own rate rules. The room is taxed on the tariff slab; the restaurant is taxed on the F&B rules. Mixing them on one line or applying the room rate to food is a common and costly error.
Can I claim input tax credit on hotel F&B?
It depends on the rate applied. The 5% restaurant rate comes without input tax credit, while the 18% rate (in premium hotels) allows it. This is one reason the correct classification matters, it affects both what you charge and what you can claim.
How should F&B be shown on the bill?
Food and beverage should be a separate line or a separate invoice from the room, each with its own SAC/HSN and the correct GST rate and CGST/SGST split. Never fold F&B into the room charge, it produces the wrong tax and an invoice a corporate guest cannot use.