GST Registration for Tour Operators

 One of the most promising startups and businesses in India is the tour operator. Business models have changed with the advent of technology. They have also found the tax system more complicated. GST Registration for tour operators is one example of this complexity. You need to know the basics of GST Registration for tour operators if you are planning on starting a business as a Tour Operator or if you already own one. This article will cover all aspects of GST Registration for Tour Operators.

What is the role and responsibilities of tour operators? What is the role of a tour operator?

A tour operator is typically a company that offers a complete package. They offer accommodation, meals, and sightseeing as well as other similar services.

Tour operators are responsible for providing complete holidays in both the country and abroad. Simply put, a tour operator is a company that combines several tourism products and creates travel packages that are tailored to the needs and interests of their customers.


GST Registration is required for any company or individual who designs, promotes, and works with suppliers to create an all-inclusive trip. Tour operators typically sell directly to their clients, or through travel agents. Therefore, they may need GST Registration. These businesses are also e-commerce, meaning they can have a website or mobile app. In this instance, they must mandate register for GST and file GST Return Filing.

Two major business models for tour operators

A Tour Operator that offers Tour Packages:

The tour operator will handle the entire booking and charge the full price, which includes his profit margin. The Tour Operator is now a service provider and can receive services from many different counterparts like hotels, airlines, taxi companies, cafes, embassies that issue visas.

A tour operator who acts as an agent only:

The tour operator facilitates the process by helping travelers to identify and reserve vendors that meet their needs. The traveler pays directly to the service provider. The tour operator charges the passenger only for the portion of the service.

GST Application to Tour Operator Businesses

Any tour operator with a turnover exceeding Rs. GST registration in India is mandatory for any tour operator that has a turnover of more than Rs. 20 lakhs per fiscal year. In the case of certain categories or states, the turnover limit for GST Registration is Rs. ten Lakhs. It is simply a term for tour operators in the states:

  1. Arunachal Pradesh

  2. Assam

  3. Jammu & Kashmir

  4. Manipur

  5. Meghalaya

  6. Mizoram

  7. Nagaland

  8. Sikkim

  9. Tripura

  10. Himachal Pradesh

  11. Uttarakhand

If their annual turnover exceeds ten Lakhs Rupees, they will need to file GST Return Filing and GST Registration.

It is important to remember that not all cases are subject to the threshold limit on turnover. The person who makes inter-state taxable supplies, for example. For example, an operator who supplies taxable goods or services to another taxable person (e.g., an airline travel agency) must register for GST.

What are the SAC codes for travel agents for outward supply?


Booking services for accommodation, cruises, and package tours

998552

Booking services for congress centers, exhibition halls, and convention centers

998553

Services for booking event tickets, theatre halls, entertainment, or other reservations

998554

Transportation reservation services

998551

Services of a tour operator

998555

Other travel arrangements and related services

998559

Freight insurance services and Travel insurance services

997136

Tourist Guide Service

998556

Information and promotion of tourism

998557

Services offered on a commission or contract basis for wholesale trade Explanation

996111

Retail trade services are provided on a contract or fee basis. Explanation

9962


You can also find the complete list of HSN codes on our website.

GST Tax Rates for Tour Operators after GST Registration

The following are the GST Tax Rates for Tour Operators After GST Registration

  1. A Tour Operator can charge 18% GST only on the total commission amount and receive reimbursements for other expenses when providing services.

  2. Other Services by the way of admission to amusement parks including theme parks, water parks, joy rides like camel ride, elephant ride, horse ride, jeep safari, merry go rounds, go-carting & ballet will attract 18% GST from 25th January 2018 via notification no.01/2018. However, the benefits of ITC will not be available to tour operators paying 5% GST.

  3.  Other services such as guide services and portal services attract 18% GST.

  4. GST exempts service by a specific organization in relation to religious pilgrimage facilitated under bilateral agreement by the Ministry of External Affairs of the Government of India

  5. The taxpayer has the following rights as a tour operator:

    1. Charge 5% GST on the total value, and get zero input tax credit

    2. Charge 18% GST on the total value.


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