Tour operator under GST
“Tour operator under GST” means any person engaged in the business of planning, scheduling, organizing, arranging tours (which may include arrangements for accommodation, sight-seeing or other similar services) by any mode of transport and includes any person engaged in the business of operating tours
Registration limit under Tour Operator under GST
Every supplier whom aggregate turnover in financial year exceeds Rupees 20 Lakhs shall be liable to be registered under GST. The Limit is 10 Lakhs in case of special category of states.
Further threshold limit of Rs. 20 Lakhs is not applicable in following cases
- Peron making any inter-state taxable supply
- Person who makes taxable supply of goods or service or both on behalf of other taxable person whether as an agent or otherwise, such as Air Travel Agent.
Activities include in Tour operator under GST
- Air Travel Agent
- Rail Travel Agent
- Rent-A-CAB Service
- Tour Package- inbound & outbound
- Visa & Passport Assistance
- Hotel Booking Services
- Travel Insurance Services
- Other Services (amusement facilities, joy rides like camel ride, elephant ride, horse ride, boat ride, jeep safari, porter services, guide services etc)
Air Travel Agent
Case-1: Air Travel Agent opts to pay GST on basis fare module
Air travel agents will raise 2 invoices.
| Type of booking |
Basic fare assumed (Rs.) |
Effective value (Rs.) | GST payable @ 18% (Rs.) |
Effective rate of GST % |
| Domestic ticket | 10,000 | 500 (5% of basic fare) | 90 | 0.90% |
| International ticket | 10,000 | 1,000 (10% of basic fare) | 180 | 1.80% |
Note: In case an air travel agent opts to pay GST on basic fare module, he is not required to pay GST on commission received from the airlines as well as service charges / booking charges / management charges from the customer / passenger. (Domestic Booking)
| Invoice to Client | ||||
| S.No | Particulars | Reimbursement of Expenses |
Taxable Value |
Total Value |
| 1 | Reimbursement of Air ticket issued by Airline |
10000 | 0 | 10000 |
| 1a | Value of basic fare included above |
9000 | 0 | |
| 2 | Booking Charges to passenger |
300 | 300 | |
| 3a | Add: CGST @ 0.45% or IGST @ 0.9% |
40.5 | 40.5 | |
| 3b | Add: SGST @0.45% | 40.5 | 40.5 | |
| 4 | Total | 10381 | ||
Invoice to Airline (When ATA is on Basic fare model) |
||||
| S.No | Particulars | NonTaxable Value | Total Value | |
| 1 | Commission from Airline | 500 | 500 | |
| 2a | Add: CGST @ 9% or IGST @ 18% |
|||
| 2b | Add: SGST @9% | |||
| 4 | Total | 500 | 500 |
Case-2: Air Travel Agent opts to pay GST on Commission module
Air travel agents will raise 2 invoices.
- 1st Invoice: Service fees @ 18% on invoice value to passenger. ITC is available
- 2nd Invoice: 18% on Commission receive from Airlines Company. ITC is available
Invoice to passenger (When ATA is on commission model) |
||||
| S.No | Particulars | Reimbursement of Expenses |
Taxable Value |
Total Value |
| 1 | Reimbursement of Air ticket issued by Airline |
10000 | 0 | 10000 |
| 1a | Value of basic fare included above |
9000 | 0 | 0 |
| 2 | Booking Charges to passenger |
100 | 100 | |
| 3a | Add: CGST @ 9% or IGST @ 18% |
9 | 9 | |
| 3b | Add: SGST @9% | 9 | 9 | |
| 4 | Total | 118 | 10118 | |
Invoice to Airline (When ATA is on commission model) |
||||
| S.No | Particulars | Taxable Value | Total Value | |
| 1 | Commission from Airline | 500 | 500 | |
| 2a | Add: CGST @ 9% or IGST @ 18% |
45 | 45 | |
| 2b | Add: SGST @9% | 45 | 45 | |
| 4 | Total | 590 | 590 |
Principal to Principal billing
| Particulars | Cost | Sale Value |
| Ticket Purchase (Value) | 23810 | |
| GST by Airline* | 1190 | |
| Total ticket price | 25000 | |
| Ticket Sold at | 24762 | |
| GST by agent** | 1238 | |
| Total sale price of ticket | 26000 |
* Input credit at time of service has been received
** due immediately
Place of Supply:
Commission from Passenger:
Case 1: Service receiver located in India & his address is available: Location of service Recipient
Case 2: Service Receiver address not available: Location of Service Provider
Commission from Airlines:
Case 1: Location of Airlines in India: Location of Service recipient
Case 2: Location of Airlines outside India: Location of service Provider
GST Return filing Service
Rail Travel Agent
GST rate will be 18% on service charges collected from passengers. No commission is paid by the railways, So, no other option rate is applicable in this case.
SAC in the case of Rail Travel Agent will be 9967.
Place of supply: Location of service Recipient
There are 2 methods of invoice:
- If the invoice not showing margin separately then tax liability shall be on the gross amount charged
- If invoice showing margin separately then tax liability shall be @ 18% of margin shown only (rule 33)
GST Return filing Service
Rent-A-Cab Service
Commission Basis
GST Applicable rate will be @18%
Net Cost & Mark-up basis
Case-1: where the cost of fuel is included in the consideration charges: GST Applicable rate will be @5% without ITC or @12% with ITC
Case-2: where the cost of fuel is not included in the consideration charges: A Cab operator is required to pay GST@ 18% with ITC.
SAC in the case of Rent-A-CAB service is 9967.
Place of supply: Location of service Recipient
There are 2 methods of invoicing if operator hired cab:
- If the invoice not showing margin separately then tax liability shall be on the gross amount charged
- If invoice showing margin separately then tax liability shall be @ 18% of margin shown only (rule 33)
GST Return Filing:
Tour Package- inbound & outbound
Inbound Tour Package:
Tours organized by the Tour Operator, within India for the tourist coming from outside India is known as inbound tours.
- Principal basis: If tour is on Principal basis i.e. on its own account has done the various booking and then raises bill on the client, then GST @5% with no ITC (@18% with ITC) & the place of supply shall be location of performance of service i.e. in India
Note: If Tour operator avail any services from another Tour Operator as input service then ITC on such input services which is similar to his output can be taken. (Notification No. 1/2018- Central Tax (Rate), dated 25th January, 2018) (5% on total value not mark-up)
- Commission basis: If the tour is on Commission basis then taxable @ 18% with ITC & place of supply shall be location of Service Provider i.e.in India
- Service fees on client basis: If hotel/ transporter issues invoice directly in the name of the client and the tour operator issues invoice only for its service fees to the client. The agent will issue an invoice on the client disclosing separately for its service charges and amount charged by the hotel/ transporter for booking. The agent can charge GST @ 18% of service charge only with ITC or GST @5% without ITC
Outbound Tour Package:
Tours organized by the Tour Operator, outside India, for the tourist going outside India is known as outbound tour.
- Principal basis: If tour is on Principal basis i.e. on its own account has done the various booking and then raises bill on the client, then GST @5% with no ITC (@18% with ITC) & the place of supply shall be location of performance of service i.e. in India
Note: If Tour operator avail any services from another Tour Operator as input service then ITC on such input services which is similar to his output can be taken. (Notification No. 1/2018- Central Tax (Rate), dated 25th January, 2018) (5% on total value not mark-up)
- Commission basis: If the tour is on Commission basis then taxable @ 18% with ITC & place of supply shall be location of Service Provider i.e.in India
- Service fees on client basis: If hotel/ transporter issues invoice directly in the name of the client and the tour operator issues invoice only for its service fees to the client. The agent will issue an invoice on the client disclosing separately for its service charges and amount charged by the hotel/ transporter for booking. The agent can charge GST @ 18% of service charge only with ITC or GST @5% without ITC
Note: Outbound tour sold to a foreigner for visiting another foreign country & the payment received in foreign country is exempt from GST.
GST Return Filing:
Visa & Passport Assistance
Visa & Passport Assistance is required to pay GST@ 18% with ITC.
VFS will issue invoice directly in the name of custom er, hence agent will charge GST only on his fees and w ill not be able to take the credit of GST charged by VFS to the client
| S.No | Particulars | Consulate | VFS | VA |
| 1 | Consulate Fees | 5000 | 5000 | 5000 |
| 2 | VFS | |||
| 2.1 | VFS Fees | 1000 | ||
| 2.2 | Courier/ DD Charges | 300 | ||
| 2.3 | GST @ 18% on 2.1+2.2 | 234 | ||
| Total | 6534 | |||
| 3 | Agents | |||
| 3.1 | Visa Fees | 500 | ||
| 3.2 | Reimbursement of VFS fees as per receipt attached | 1534 | ||
| 3.3 | GST @ 18% on 3.1 | 90 | ||
| Total | 7124 |
Place of Supply:
Case 1: Service receiver located in India & his address is available: Location of service Recipient
Case 2: Service Receiver address not available: Location of Service Provider
GST Return Filing:
Hotel Booking Services
With ITC
Room Rent upto Rs 7500/- per day = GST Rate@12%
Room Rent above Rs 7500/- per day = GST Rate@18%
Without ITC
5%
Methods of invoicing
- Commission from hotels: 18% on Commission receive from hotel. ITC is available
- Invoice raise by hotel in the name of client: The agent will issue an invoice on the client disclosing separately for its
service charges and amount charged by the hotel for booking. The agent can charge GST @ 18% of service charge only with ITC or GST @5% without ITC (rule 33) - Invoice raise by hotel not in the name of client: If the invoice raised by the hotel is not in the name of client, then tax liability shall be on the full value of amount charged for hotel booking @12%-18% with ITC or @ 5% without ITC
- Not in taxable territory: International booking not in taxable territory GST @ 0%
Place of supply:
Commission from Hotel:
- Domestic Hotel: Location of Hotel
- International Hotel: Location of Service Provider
Commission from Passenger:
- Location of Service Recipient is in India: Location of Service Recipient
- Location of Service Recipient is out of India: Location of Hotel
GST Return filing Services
Car Hire Services
Travel agent may receive income for booking of Car hire on the following 2 methods:
- Principal basis: If car hire service is on Principal basis i.e. the travel agent may purchase the car on hire on its own name and raises bill to the clients, then GST @5% with no ITC (@18% with ITC)
- Commission basis: If the car hire service is on Commission basis then taxable @ 18% with ITC
Place of Supply:
Case 1: Service receiver located in India & his address is available: Location of service Recipient
Case 2: Service Receiver address not available: Location of Service Provider
GST Return filing Services
Travel Insurance Services
Travel Insurance Agent is required to pay GST@ 18% with ITC or 5% without ITC
GST Return filing Services
Other Services
Amusement facilities / joy rides like camel ride, elephant ride, horse ride, boat ride, jeep safari services attract GST@ 28% with ITC or 5% without ITC. SAC code as 9996.
Porter services, guide services attract GST@ 18% with ITC or 5% without ITC. SAC code is 9985
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