GSTR-3B for restaurants — line-by-line filing guide for 5% and 18% rates

About this piece. GSTR-3B is the monthly summary return every GST-registered restaurant files. It looks simple on the portal — six tables — but the line-by-line reality for restaurants is non-obvious because the restaurant industry sits in two GST rate regimes that operate differently, and the rise of aggregator-side tax collection has shifted what shows up in your return vs the platform's. This is the operator's working guide.

The two restaurant rate regimes — pick yours before you read further

Indian restaurants pay GST under one of two regimes, fixed by your registration:

For ~98 percent of Indian restaurants the answer is 5%, no input tax credit. This piece focuses on the 5% regime first, with the 18% notes at the end for the small minority.

The 5%-no-ITC structure is a compromise the GST Council made in November 2017 to keep restaurant prices consumer-friendly. The trade-off is that all the GST you pay on rent, electricity, kitchen equipment, packaged ingredients, software, and consultants is a cost you absorb — you cannot net it against output tax.

The GSTR-3B form — what restaurants fill in

GSTR-3B has six tables. For a 5%-regime standalone restaurant, here's what each table looks like:

Table 3.1 — Outward supplies and inward supplies liable to reverse charge

Aggregator nuance: From January 2022 onwards, food delivered through e-commerce operators (Swiggy, Zomato) is taxed at 5% under Section 9(5), with the aggregator liable to collect and pay the tax — not the restaurant. The restaurant still includes the gross order value in its sales register but does not pay the GST on those orders again. This shows up in Table 3.1.1 (notified supplies through e-commerce operators) on the restaurant side and in the aggregator's own 3B as a separate line.

Table 3.2 — Inter-state supplies to unregistered persons, composition taxable persons, UIN holders

State-wise breakdown for B2C inter-state sales above ₹2.5 lakh per state. Most single-outlet restaurants leave this blank — the customer is local. Multi-state catering, online food gifting, and delivery across state lines can trigger entries here.

Table 4 — Eligible ITC

For 5%-regime restaurants this is where the structural pain sits. The form expects you to declare available ITC, then to reverse the ineligible portion. For 5%-no-ITC restaurants, all ITC on inputs related to restaurant service is ineligible:

The single most common 5%-restaurant filing error is leaving Table 4(B) blank. The correct treatment is to populate (A), then reverse the full amount in (B)(2), so net (C) is nil. The portal does not auto-do this for you.

Table 5 — Values of exempt, nil-rated, and non-GST inward supplies

Largely informational — petrol, diesel, alcohol purchased for stock (where applicable), exempt food items.

Table 6.1 — Payment of tax

The bottom of the form computes tax liability and lets you settle via cash ledger or credit ledger. For 5%-restaurants the cash ledger does almost all the work — there's no ITC to net.

Cash payment via Challan (PMT-06) generated on the portal, paid through net banking or NEFT/RTGS. The challan must be paid before submission of the return; the submitted 3B settles the liability against the cash ledger balance.

Table 6.2 — TDS/TCS credit

Restaurants on aggregator platforms see TCS (tax collected at source) credit here from January 2024 changes — the aggregator collects TCS and the restaurant claims credit. Verify the credit amount against GSTR-2B before filing.

The 4 reconciliation traps before you hit submit

Operators routinely file 3B from the GSTN portal pre-fill and discover errors at year-end during GSTR-9 (annual return) reconciliation. The four traps to check before submission, every month:

1. Aggregator gross vs net. Swiggy and Zomato deduct their commission, GST on commission, marketing fees, and TCS before crediting your bank. Your sales register shows the gross order value (the customer-paying number); your bank shows the net settlement. Both must reconcile to your 3B outward supplies. Build a monthly aggregator reconciliation sheet.
2. Cash sales vs POS reports vs DSR. If your daily sales report (DSR) shows ₹14.2 lakh of cash sales for the month and your POS shows ₹14.4 lakh, that ₹20,000 gap will surface in GSTR-9 with interest. Reconcile DSR-to-POS daily; the monthly 3B inherits clean numbers.
3. Liquor + non-GST line. Alcohol is taxed under state excise, not GST. If you serve liquor, it must come out of GST sales and into the non-GST line (Table 3.1.e). A restaurant that puts liquor in 3.1(a) over-pays GST every month — usually unrecovered.
4. ITC in Table 4 not reversed. If your accountant populates Table 4(A) with available ITC and forgets to reverse it in (B), the return shows you claiming credit you're not entitled to. The mismatch surfaces in GSTR-2B vs 3B comparison and triggers a notice. The fix is mechanical: 4(A) gross, 4(B)(2) reverses, 4(C) nets to zero.

Filing cadence and deadlines

Late filing of 3B attracts ₹50/day late fee per Act (₹20 for nil returns) plus interest at 18 percent per annum on unpaid tax. Multi-month delays can run into ₹10,000+ in late fees alone.

The 5%-no-ITC regime feels punitive on paper — you pay GST on rent and equipment with no offset. In practice, most 5%-regime restaurants are smaller-margin operators where the simplicity of "5% of sales, paid monthly, done" is worth more than the credit complexity of 18% with ITC. The math favours 18% only above a certain rent + capex profile, and the regime change is irreversible. Don't switch regimes without a CA's written calculation.

The 18%-with-ITC regime — three differences

For restaurants in starred hotels (room tariff > ₹7,500/night) operating under the 18% regime:

1. ITC is available. Table 4(A) is populated and most of it is claimable; (B) only reverses for blocked credits under Section 17(5).
2. Output rate is 18%. Half-and-half across CGST and SGST (or full IGST if inter-state).
3. The hotel's room business often shares ITC pools. Cross-utilisation between room (12% or 18% depending on tariff slab) and restaurant (18%) becomes part of the working capital math.

The CGST Section 17(5) blocked-credits list is the operator's permanent reference: motor vehicles for personal transport, food and beverages for personal consumption, club memberships, works contracts for immovable property — these are blocked even in 18% regime. Read the section once with your CA; the list is short and stable.

A worked example: 5%-regime QSR doing ₹35L/month

Sales for the month:
  Walk-in / dine-in / cash + UPI + card    ₹22,40,000
  Aggregator orders (Swiggy + Zomato gross) ₹12,60,000
  Gross sales                              ₹35,00,000

Of which:
  Aggregator gross taxed by aggregator     ₹12,60,000   <-- Section 9(5)
  Restaurant-side taxable sales            ₹22,40,000

GSTR-3B Table 3.1(a)                       ₹22,40,000
  CGST 2.5%                                ₹56,000
  SGST 2.5%                                ₹56,000
  Total tax payable                        ₹1,12,000

Table 3.1.1 (notified supplies through ECO) ₹12,60,000  (informational)

Table 4 ITC:
  (A) Available (rent ₹40k GST + utilities ₹8k GST + 
       packaging ₹12k GST + cleaning ₹6k GST)            ₹66,000
  (B)(2) Reversed (5%-no-ITC regime)                     ₹66,000
  (C) Net ITC                                            ₹0

Cash payment via PMT-06: ₹1,12,000

That's the entire 5%-restaurant 3B in numbers. Filed on the 20th of the next month. Done.

Where this fits in the compliance stack

GSTR-3B is one of about 38 compliance items a restaurant tracks per year. Sister returns:

• GSTR-1 — outward supplies detail, filed monthly by the 11th
• GSTR-3B — summary return + payment, this piece
• GSTR-9 + 9C — annual return + audit reconciliation
• TDS returns — if applicable to your scale

Get the monthly cadence right and the annual reconciliation becomes a 2-day exercise in December. Skip months and the annual becomes a 6-week firefight.

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