Opening a restaurant

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

20 February 2016 I am going to open a restaurant (AC & Non AC) in ahmedabad. Which registration I would require including VAT CST Service Tax? and which rate is applicable for service tax?

Suresh Ramaswamy

Suresh Ramaswamy (Expert)
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20 February 2016 Restaurants are subject to both VAT and Service Tax. The exemption from VAT varies from state to state and till the threshold limit is reached no VAT is payable, if the registration is not taken. At the relevant level of turnover an application for voluntary registration i.e. much below the threshold limit

Service Tax is applicable once the turnover touches Rs.10 lakhs. On achieving Rs.9 Lakhs compulsory registration should be taken. For restaurants with full A/C or part A/C service tax is leviable on 40% of the invoice amount.in

VAT is applicable on full invoice amount including Service Tax.

Please ensure timely registration, because on reaching the threshold limits, the liability automatically accrues, irrespective of whether they have been charged from the customers.