Running a restaurant in India today isn’t just about food and service — it’s about compliance too. With GST (Goods and Services Tax) streamlining indirect taxation, restaurant owners must understand when and how to register, what tax rates apply, and how non-compliance can dent profits. Whether you own a small café, a family-run dhaba, or a growing cloud kitchen tied to Swiggy and Zomato, GST registration is more than a formality — it’s a business essential.
Who Needs GST Registration for Restaurants?
Not every food outlet is required to register for GST. The rule is simple:
- Mandatory GST registration if your restaurant’s annual turnover exceeds ₹20 lakh (₹10 lakh in special category states like the North East).
- Even if turnover is below the threshold, registration is compulsory for restaurants supplying through online aggregators like Zomato, Swiggy, or Uber Eats.
- Franchise outlets (like Domino’s, KFC, or Subway) typically come under compulsory GST due to their national-scale operations.
👉 Example: A local biryani shop in Hyderabad earning ₹15 lakh a year might avoid GST registration if serving only dine-in customers. But the same shop delivering via Swiggy must register regardless of turnover.
GST Rates for Restaurants
One of the most searched queries is — What GST rate applies to restaurants? Here’s the breakdown:
- 5% GST (without ITC) → Standalone restaurants (non-AC, AC, or takeaway). Input Tax Credit (ITC) cannot be claimed.
- 18% GST (with ITC) → Restaurants inside hotels charging room tariff above ₹7,500.
- 5% GST → Cloud kitchens and online food delivery services.
This means a thali at your neighbourhood mess or a pizza from Domino’s attracts 5% GST, while luxury hotel dining could see higher taxes.
Documents Required for GST Registration
Restaurant owners need to keep these documents ready for GST registration:
- PAN card of the business owner
- Aadhaar card
- Proof of business registration (Partnership deed, ROC certificate, etc.)
- Address proof of restaurant premises (electricity bill, rent agreement)
- Bank account details (cancelled cheque or bank statement)
- Photographs of owners/partners
How to Register for GST Online
The GST registration process is now fully online via the GST portal (www.gst.gov.in). Steps include:
- Visit the GST portal and click “New Registration.”
- Fill in details (PAN, mobile number, email).
- Upload documents and verify via OTP.
- Submit application and receive Application Reference Number (ARN).
- On approval, GSTIN (GST Identification Number) is issued.
👉 Pro Tip: Many restaurants opt for professional help (CAs, GST practitioners) since errors in initial filing can delay business listings on delivery platforms.
Benefits of GST Registration for Restaurants
While some see GST as red tape, it offers clear benefits:
- Legitimacy: Customers and delivery apps trust registered businesses.
- Wider reach: Mandatory for Swiggy/Zomato onboarding.
- Smooth compliance: Avoid penalties or legal hassles.
- Business growth: Easier to scale or seek franchise opportunities.
Penalties for Non-Compliance
Avoiding GST when eligible can be costly. Restaurants caught without registration face:
- 10% penalty of the tax due (minimum ₹10,000).
- Higher penalties for repeated or intentional evasion.
- Removal from Swiggy/Zomato platforms, cutting off digital customers.
Conclusion: GST Is the New Normal for Restaurants
In India’s fast-growing F&B industry, GST compliance is no longer optional — it’s the backbone of smooth operations. From Amul parlours in small towns to five-star hotel restaurants in Mumbai, GST rules apply across the board. For small eateries and cloud kitchens, registration not only keeps authorities happy but also opens doors to online food delivery, brand partnerships, and faster growth.
If you’re planning to run a restaurant — big or small — make GST registration your first recipe for success.
