In short
| Item | What applies | Since | Good to know |
|---|---|---|---|
| Room up to ₹7,500 a night | 5% | 22 Sep 2025 | Was 12%. Rooms up to ₹1,000 were exempt until 17 Jul 2022. The hotel's own credit: see the next row. |
| Room above ₹7,500 a night | 18% | 1 Oct 2019 | Was 28% for ₹7,500 and above. |
| Credit for a 5% hotel | Only on rooms bought from other hotels, capped at 5% | 1 Nov 2026 | No credit at all before that. |
| Restaurant | 5% (18% in specified premises) | 15 Nov 2017 | Was 12% or 18%. At 5%, no credit, except from 1 Nov 2026 on restaurant service bought from restaurants outside specified premises. |
| Outdoor catering and banquets | 5% (18% at specified premises) | 1 Oct 2019 | Was 18%. At 5%, no credit, except from 1 Nov 2026 on catering bought from other caterers, up to 5%. |
| Business guest claiming the hotel's GST | Yes, for work trips, in a state where you are registered | 1 Jul 2017 | The hotel charges its own state's CGST and SGST, so the bill must carry your GSTIN for that state. Meals stay blocked. |
| Long stays (up to ₹20,000 per person a month, 90+ days in a row) | Exempt | 15 Jul 2024 | Any accommodation, hotels included, if both tests are met. |
Current, upcoming and expired rules
Current is what applies today. Upcoming is notified and starts later. Expired shows what applied before, from which date to which date, for when an old invoice or a notice asks.
Rules as on 31 Oct 2026 (India time). A rule moves between the tabs on its own when its start or end date passes.
| Rule | Rate | Dates | Law and source |
|---|---|---|---|
| Hotel rooms up to ₹7,500: 5% without creditRooms up to ₹7,500 a night are taxed at 5% and the hotel takes no input credit for them. This is a fixed rate, not an option. Rooms above ₹7,500 stay at 18% with credit.Credit (ITC): None for the 5% rooms; full credit at 18%.For a cab operator: A business guest can still claim the 5% on a work trip. The 'no credit' condition limits the hotel, not the guest. | 5% / 18%Code 996311 | 22 Sep 2025 – 31 Oct 2026 | 15/2025-CT(Rate), S.No. 7(i) Checked against the textNotification 15/2025-CT(Rate) |
| 'Specified premises': last year's room prices, or a declarationA place is specified premises for a year if it charged more than ₹7,500 for any room in the previous year, or if the hotel opted in by declaration between 1 Jan and 31 Mar of the previous year. | — | Since 1 Apr 2025 | 05/2025-CT(Rate), clause (xxxvi) Checked against the textNotification 05/2025-CT(Rate) |
| Long stays up to ₹20,000 a monthAny accommodation, a hotel included, is exempt if it costs up to ₹20,000 per person per month and is supplied for at least 90 days in a row. | ExemptCode 996322 | Since 15 Jul 2024 | 04/2024-CT(Rate), S.No. 12A of 12/2017 Checked against the textNotification 04/2024-CT(Rate) |
| Food ordered through delivery appsThe delivery app pays the GST on restaurant orders placed through it, except for restaurants at specified premises, which pay their own. | 5%Code 996331 | Since 1 Jan 2022 | CGST Act s.9(5); 17/2021-CT(Rate) Checked against the textNotification 17/2021-CT(Rate) |
| Restaurants: 5%, or 18% at 'specified premises'Restaurant service is 5% without credit, unless supplied at 'specified premises' (a hotel with rooms above ₹7,500), where it is 18% with credit.Credit (ITC): None at 5%; full credit at 18%. | 5% / 18%Code 996331 | 1 Oct 2019 – 31 Oct 2026 | 20/2019-CT(Rate) S.No. 7(ii) Checked against the textNotification 20/2019-CT(Rate) |
| Outdoor catering: 5% without credit, outside specified premisesOutdoor catering is 5% without credit, unless it is served at, or by a caterer located in, specified premises. Then it is 18% with credit.Credit (ITC): None at 5%; full credit at 18%. | 5% / 18%Code 996334 | 1 Oct 2019 – 31 Oct 2026 | 20/2019-CT(Rate) S.No. 7(iv) Checked against the textNotification 20/2019-CT(Rate) |
| Rooms booked through an online platformWhen a room is booked through an e-commerce operator and the owner does not need GST registration, the platform pays the GST. Hotels that must register pay their own. | Room rateCode 996311 | Since 1 Jul 2017 | CGST Act s.9(5); 17/2017-CT(Rate) item (ii) Checked against the textNotification 17/2017-CT(Rate) |
Checked against the government text Official copy not yet online; matched across published copies The law is unclear; this is our reading
On a timeline
Each line is one rule; each bar is one period. Grey has ended, green applies today, amber starts later.
Who can claim GST credit
Input tax credit (ITC) is GST you paid on a purchase that you subtract from the GST you collect. Whether you get it depends on who you are and what you bought.
| Who | Buys | Can claim? | Condition |
|---|---|---|---|
| Any employer | Holiday travel for staff (leave or home travel) | No | Travel benefits for employees on vacation are blocked, unless a law makes the employer provide them.CGST Act s.17(5)(b)(iii) |
| A business whose staff travel | Hotel rooms for business trips | Yes, in your state | The stay must be for work and the bill must carry your GSTIN for the hotel's state. A hotel always charges its own state's CGST and SGST, so a stay in a state where you have no GSTIN is usually not claimable. A 5% hotel's 'no credit' condition limits the hotel, not you. Meals on the bill stay blocked.CGST Act s.16, s.17(5)(b)(i); IGST Act s.12(3)(b); WB AAR 39/WBAAR/2018-19 (Storm Communications) |
| Hotel charging 5% (rooms up to ₹7,500) | Rooms bought from another hotel for its own guests | Yes, from 1 Nov 2026 | Capped at 5% of the value. Before 1 November 2026 a 5% hotel could take no credit at all.06/2026-CT(Rate) |
| Hotel charging 5% (rooms up to ₹7,500) | Linen, repairs, renovation, software and other costs | No | The 5% room rate allows no other credit.15/2025-CT(Rate) S.No. 7(i) |
| Any business | Meals or outdoor catering for staff or guests | No | Food and drink are blocked unless you sell the same kind of service (a caterer buying from a caterer) or a law makes you provide it.CGST Act s.17(5)(b)(i) |
| Restaurant charging 5% | Restaurant service bought from another restaurant (not at specified premises) | Yes, from 1 Nov 2026 | Only that same-line credit, with no cap written in the entry. Everything else stays without credit.06/2026-CT(Rate) |
What courts and rulings have said
Judgments and advance rulings that explain a rule, including ones that pull in different directions. Weigh them by who gave them: a Supreme Court judgment binds every court in India; a High Court’s is followed by courts and tax officers in its State and is persuasive elsewhere; an advance ruling (AAR or AAAR) binds only the business that asked for it and its tax officer (section 103 of the CGST Act).
| Ruling | Question and answer | Weight |
|---|---|---|
| Supreme CourtThe State of Karnataka and another v. Taghar Vasudeva Ambrish and anotherSupreme Court of India, 4 Dec 2025Civil Appeal No. 7846 of 2023 with Civil Appeal No. 7847 of 2023; 2025 INSC 1505 | Is the owner's rent from leasing a residential building to a company that sub-lets it as a hostel to students and working women exempt as renting of a residential dwelling for use as residence?Yes, for 2019-2022: the building is a residential dwelling and was rented for use as a residence; the entry does not require the lessee itself to live there, and the occupants are sub-lessees. The 18-07-2022 amendment (no exemption when rented to a registered person) cannot be applied retrospectively. The State's appeals were dismissed.“Entry 13 of the Exemption Notification does not mandate that the lessee must use the residential dwelling as its own residence.”Notif. 9/2017-IT(Rate) S.No. 13 / Notif. 12/2017-CT(Rate) S.No. 12 (amended w.e.f. 18-07-2022 and 01-01-2023); Notif. 04/2024-CT(Rate) dated 12-07-2024 (S.No. 12 Explanation 2 and new S.No. 12A, w.e.f. 15-07-2024)Supreme Court judgment (sci.gov.in)Supreme Court record of proceedings, 18-02-2025 (case numbers)Notif. 04/2024-CT(Rate), Gazette copy (hosted by Taxo) | ClarifiesEveryone (Article 141 of the Constitution)Final. Later law narrows it: from 18 Jul 2022 the exemption does not apply when the dwelling is rented to a registered person, and from 15 Jul 2024 hostels and similar places moved to a separate exemption for stays of up to ₹20,000 per person a month for 90 days or more. |
| AAARM/s Tata Motors Ltd, Sanand (appellant)Gujarat AAAR, 22 Dec 2022Advance Ruling (Appeal) No. GUJ/GAAAR/APPEAL/2022/23 | After Circular 172, can a factory with a canteen required by the Factories Act claim ITC on the caterer's GST?Yes, for the canteen serving its direct employees, because s.46 of the Factories Act makes the canteen obligatory and Circular 172 applies the proviso to the whole of s.17(5)(b). Not for contract workers or visitors. ITC is limited to the cost the company bears; the share recovered from employees is disallowed.“ITC on the above is restricted to the extent of the cost borne by appellant for providing canteen services to its direct employees”CGST Act s.17(5)(b) proviso; Circular 172/04/2022-GST; Factories Act 1948 s.46; Gujarat Factories Rules 1963Gujarat AAAR order, official scanned PDF (GST Council) | ClarifiesOnly the applicant and its jurisdictional tax officers (s.103).Final for the applicant. Follows CBIC Circular 172/04/2022-GST and modifies Gujarat AAR, Tata Motors (2021). Conflicts with Madhya Pradesh AAR, Bharat Oman Refineries (2021) and the canteen part of Gujarat AAR, Emcure Pharmaceuticals (2022). |
| AARM/s Emcure Pharmaceuticals Ltd, Sanand (applicant)Gujarat AAR, 12 Apr 2022GUJ/GAAR/R/2022/22 | Can a factory claim ITC on hired staff buses of more than 13 seats and on its canteen, and is GST due on staff recoveries or free transport?ITC on hiring buses with more than 13 approved seats is admissible. ITC on the canteen was held blocked under s.17(5)(b)(i). No GST on free bus transport for employees or on the employees' share of canteen charges collected and passed to the caterer.“ITC on GST paid on hiring of Bus, having approved seating capacity of more than 13 persons used for transportation of passengers, is admissible.”CGST Act s.17(5)(a), s.17(5)(b)(i) and provisoRuling text, PDF copy hosted by LiveLawLiveLaw report (secondary) | Rulings differOnly the applicant and its jurisdictional tax officers (s.103).The bus part agrees with the Maharashtra AAR (Tata Motors, 2020) and the Haryana AAAR (YKK India, 2019). The canteen part conflicts with CBIC Circular 172/04/2022, issued three months later, and with the Gujarat AAAR (Tata Motors, 2022). |
| AARM/s Tata Motors Ltd, Sanand (applicant)Gujarat AAR, 30 Jul 2021GUJ/GAAR/R/39/2021 | Can a factory claim ITC on the canteen it must run under the Factories Act?No. Going by the semicolons in the section, the AAR held that the 'obligatory under any law' proviso attaches only to sub-clause (iii) (travel benefits), so canteen food under sub-clause (i) stays blocked. No GST is due on the employees' share of canteen charges collected and passed to the caterer.“ITC on GST paid on canteen facility is blocked credit under Section 17 (5)(b)(i) of CGST Act and inadmissible to applicant.”CGST Act s.17(5)(b)(i) and provisos; Factories Act 1948 s.46Gujarat AAR ruling, official PDF (GST Council) | OvertakenOnly the applicant, and now replaced by the appeal order.Modified on appeal by Gujarat AAAR, Tata Motors (2022) (22-12-2022). Its reading of the proviso was rejected by CBIC Circular 172/04/2022-GST. |
| AARM/s Bharat Oman Refineries Ltd, Bina (applicant)Madhya Pradesh AAR, 7 Jun 2021Order No. 02/2021 | Can a refinery claim ITC on canteen services it provides to employees under the Factories Act, and is GST due on canteen recoveries?No ITC: the AAR said canteen service is a 'restaurant service' taxed at 5% without credit, so the employer cannot claim it. It also held that canteen services to employees, even free ones, are a taxable supply valued under Rule 28, not at the nominal amount recovered.CGST Act s.17(5)(b); Notification 11/2017-CT(Rate) S.No. 7(ii) as amended by 20/2019-CT(Rate); CGST Rules r.28MP AAR ruling, official scanned PDF (GST Council) | Rulings differOnly the applicant and its jurisdictional tax officers (s.103).Conflicts with CBIC Circular 172/04/2022 and the Gujarat AAAR (Tata Motors, 2022), and with the Maharashtra AAR (Tata Motors, 2020) on amounts recovered from employees. Appeal status not checked. |
| AARGolden Vacations Tours and TravelsWest Bengal AAR, 23 Sep 201926/WBAAR/2019-20 (Case No. 32 of 2019) | When a tour operator books only hotel rooms for a client, with no tour or transport, is that a 5% tour-operator service, a hotel accommodation service, or something else?Neither. Booking accommodation alone is not tour operating, which means planning, scheduling, organising and arranging tours, and it is not the hotel's own accommodation service. It is a reservation service under SAC 998552, taxable under S.No. 23(iii), the residual support-services entry (18%), with ITC as admissible.“Arranging accommodation might be provided as add-ons, but that is not the essence of the tour operating service.”Notif. 11/2017-CT(Rate) S.No. 23(i) (tour operator, 5%) and S.No. 23(iii); SAC 998552; S.No. 7 (accommodation, SAC 996311)Ruling PDF (GST Council) | Turns on its factsOnly the applicant and its jurisdictional tax officers (CGST Act s.103); persuasive elsewhereNone known. |
| AARM/s Storm Communications Pvt Ltd, Kolkata (applicant)West Bengal AAR, 28 Jan 201939/WBAAR/2018-19 | Can a company registered in one state claim ITC of CGST+SGST charged by hotels, banquet halls and caterers in another state where it has no registration?No. Hotel, banquet and restaurant services are supplied where the property is, so the supplier rightly charges that state's CGST+SGST, and that tax is input tax only for a registration in that state. It cannot be claimed in another state even if the B2B invoice carries your GSTIN and shows in GSTR-2A.“A person, registered in WB, cannot claim ITC for CGST & SGST of other states.”IGST Act s.12(3) and (4); CGST Act s.2(62), s.25(4), s.49(4)WB AAR ruling, official PDF (WB Commercial Taxes) | ClarifiesOnly the applicant and its jurisdictional tax officers (s.103).No appeal found. No CBIC circular found on this point. |
SAC and HSN codes
The code you print on the invoice: SAC for a service, HSN for goods. Since 1 April 2021 an invoice must show at least 4 digits if last year’s turnover was up to ₹5 crore, and 6 digits above that. Descriptions follow the government’s classification of services.
| Code | What it is for | Covers | GST today |
|---|---|---|---|
| 996311SAC | Hotel rooms | Hotels, inns, guest houses, clubs | 5% up to ₹7,500 a night, 18% above |
| 996331SAC | Restaurants and cafés | Dine-in, takeaway, delivery | 5% (18% in specified premises) |
| 996332SAC | Food served by hotels | Hotel restaurants, room service | 5% or 18%, by premises |
| 996334SAC | Catering at events and halls | Weddings, exhibitions, functions | 5% (18% at specified premises) |
| 998552SAC | Booking hotels, cruises and packages | Agent's service for arranging stays and packages | 18% on the agent's fee |
Where a cab operator meets hotel GST
- Booking rooms for a customer: the hotel bills its GST. You charge GST only on your own booking fee, at 18%.
- Selling a package with rooms and cabs for one price: that is usually a tour-operator service. See Tours and events.
- Your driver’s stay on an outstation duty: on the 5% option the hotel’s GST is your cost. On the 18% option you can usually claim it, but only when the hotel is in a state where you are registered and the bill carries that GSTIN: a hotel always charges its own state’s CGST and SGST.
One room, three rates
The ₹7,500 test is per room per night. Since 27 July 2018 it uses the price actually charged; before that it used the published tariff.
The same room and price, booked in three different years.
| Jul 2017 | Oct 2019 | Oct 2025 | |
|---|---|---|---|
| Room charge | ₹12,000 | ₹12,000 | ₹12,000 |
| Rate | 18% | 12% | 5% |
| GST | ₹2,160 | ₹1,440 | ₹600 |
Restaurants and 'specified premises'
Restaurant food is 5% without credit, unless it is served at “specified premises”, where it is 18% with credit. Specified premises means a hotel-type place with expensive rooms. Since 1 April 2025 that is decided by last year’s actual room prices (any room above ₹7,500), or by the hotel’s own declaration filed between 1 January and 31 March. Before that it was decided by the published tariff.
Banquets work the same way: catering with the hall is 5% without credit since 1 October 2019, or 18% at specified premises. Hall hire without food is 18%.
What changes for credit on 1 November 2026
A 5% hotel may claim credit on rooms bought from another hotel, and a 5% caterer on catering bought from another caterer, both capped at 5% of the value. A 5% restaurant may claim credit on restaurant service bought from another restaurant that is not in specified premises. Everything else stays without credit. The rates themselves do not change.
Common questions
What is the GST on a hotel room now?
5% for rooms up to ₹7,500 a night, and 18% above, since 22 September 2025. The test is the price charged per room per night.
Can my company claim the GST on a 5% hotel bill?
Yes, for a work trip, if the bill carries the company's GSTIN for the state where the hotel is. A hotel always charges its own state's CGST and SGST (the place of supply is the hotel's location), so a stay in a state where the company is not registered is usually not claimable. The 'no credit' rule binds the hotel, not the guest. GST on meals stays blocked.
Is a ₹900 room still exempt?
No. Rooms up to ₹1,000 were exempt until 17 July 2022. From 18 July 2022 they paid 12%, and 5% since 22 September 2025.
Why does the same restaurant meal cost 5% in one place and 18% in another?
Restaurants at 'specified premises' (places with rooms above ₹7,500, or that opted in) charge 18% with credit. Others charge 5% without credit.
Words used on this page
- GST option (5% or 18%)
- For cab hire with driver and fuel you choose 5% with almost no input credit, or 18% with full input credit. Until 21 Sep 2025 the second option was 12%.
- ITC (input tax credit)
- GST you paid on business purchases that you subtract from the GST you collect.
- Same line of business
- Buying the same kind of service you sell, such as cab hire bought from another operator.
- RCM (reverse charge)
- The customer pays the GST to the government instead of the supplier.
- Body corporate
- A company or an LLP. Proprietors, HUFs and partnership firms are not body corporates.
- SAC / HSN
- The code printed on an invoice for a service (SAC) or for goods (HSN).
- Place of supply
- The state whose GST applies. It decides whether you charge IGST or CGST plus SGST.
- E-invoice / IRN
- Reporting an invoice to the government portal, which returns an Invoice Reference Number and a QR code.
- Pure agent
- Someone who pays an expense on the customer's behalf, with its authority, and recovers it at actual cost.
- TDS
- Tax your customer cuts from a payment to you and deposits against your PAN. You claim it in your income tax return.
- TCS
- Tax a seller collects from the buyer on top of the price, such as on overseas tour packages.