GST billing for cafes: what the bill has to carry

This is general information for cafe owners, not tax advice. GST rates, thresholds and invoice rules change, and the right answer depends on your registration, turnover and menu. Confirm the specifics with a chartered accountant before you configure anything.

A cafe bill looks like a receipt: items, prices, total. But once the cafe is registered for GST, that slip is a tax document. It has to carry specific information, be numbered in sequence, and match what gets filed. Most POS problems in this area are not exotic — they are a missing GSTIN, a tax rate applied to the wrong line, or a menu price that quietly includes tax while the invoice adds it again.

The short version

A GST bill is a tax document: supplier GSTIN, consecutive invoice number, date, SAC, taxable value, discount, tax split and place of supply.
Regular registration issues a tax invoice with CGST/SGST or IGST. Composition issues a bill of supply and must not show GST lines.
Decide tax-inclusive vs tax-exclusive menu pricing and per-item classification before the first bill.
Rates, thresholds and invoice rules change — confirm them with a chartered accountant and keep the POS export with your returns.

First, which kind of registration are you?

There are two common situations for a small cafe, and they produce different bills.

Regular registration. The cafe charges GST on its supplies, shows CGST and SGST (or IGST) separately on a tax invoice, and can generally claim input tax credit on eligible business purchases. Restaurant service has typically been taxed at 5% without input tax credit, which means the credit question is often moot for the food itself — but the registration still brings invoice and filing obligations.

Composition scheme. A smaller restaurant may opt to pay tax at a flat rate on turnover. A composition dealer cannot collect GST from customers or issue a tax invoice; it issues a bill of supply. If your POS prints “CGST 2.5% / SGST 2.5%” for a composition dealer, the bill is wrong even if the total is right.

There is also the threshold question: service providers generally register above ₹20 lakh of aggregate turnover (lower in special-category states), but the calculation includes more than the till. Do not decide this from a blog post. Ask your CA, then tell the POS which mode you are in.

What belongs on the bill

For a regular tax invoice, the useful checklist is:

Supplier’s name, address and GSTIN
A consecutive invoice number, up to 16 characters, and the invoice date
Customer’s name, address and GSTIN where the customer is registered; for unregistered walk-ins, the requirements are lighter but the invoice still needs to identify the supply
Description of the service — “dine-in”, “takeaway”, “delivery” — and the SAC code (restaurant service is commonly 996331; confirm your classification)
Taxable value per line, and any discount shown separately
CGST and SGST for a supply within the state, or IGST for an inter-state supply
Place of supply
Total amount payable, and the tax rate where applicable

Two details trip people up more than the rest:

Tax-inclusive menu prices. If the menu says ₹200 and GST is 5%, the customer should pay ₹200, with the tax backed out of it — not ₹210. The POS has to know whether prices are tax-inclusive or exclusive, and it has to apply that consistently. Switching the setting after the menu is loaded changes every total.

Alcohol. Alcoholic liquor for human consumption is outside GST and is taxed under state excise rules. A bill that mixes food and alcohol needs the two treated separately, with the correct state levies. If the POS has one tax field for the whole bill, it cannot do this correctly.

The invoice series is not a detail

GST invoices have to be numbered consecutively within a series. A POS that resets numbering every day, or lets two terminals issue the same number, creates a reconciliation problem that surfaces at filing time.

Decide the series before the first bill:

One series per financial year, or per outlet if you have more than one
A prefix that identifies the outlet and the order type, if that helps your accountant
A rule for cancelled bills: mark them cancelled in the system, do not delete the number
A rule for reprints: a duplicate must be marked as a duplicate

The goal is simple: for any invoice number, there is exactly one bill, and the sequence has no unexplained gaps.

Where POS configuration usually goes wrong

The tax rate is set on the item, but the exemption is on the supply. A packaged retail product and a prepared drink can be classified differently. Get the classification right per item before loading prices.
Discounts are applied after tax. A discount that reduces the taxable value has to be reflected before the tax is computed, not subtracted from the grand total.
Service charge is treated as tax. A service charge is part of the bill; GST applies to the value of supply including it. A voluntary tip is not the same thing and should not be buried in the taxable total.
Rounding is inconsistent. Round-off is fine if it is a line on the bill, not a silent adjustment that makes the day’s total disagree with the invoices.
The day close does not reconcile. Cash, card and UPI totals should match the bills issued. If they do not, the problem is usually a payment mode recorded as “other” or a bill settled twice.

What to ask your accountant before setup

Bring these five answers to the POS configuration, not the other way round:

Are we regular or composition?
Are menu prices inclusive or exclusive of tax?
Which SAC code and rate apply to each category — food, beverages, packaged retail, alcohol?
What invoice series and format do you want, including cancellations and reprints?
How should service charge and tips appear on the bill?

Write the answers down. A POS is only as correct as the rules it is given.

Where CafePOS fits

We build CafePOS, so read this as a product description.

CafePOS has configurable tax settings for billing, and it records order type (dine-in, takeaway, delivery) alongside the bill. It is a cloud POS, so the invoice data lives in the service and is available to the owner’s reports without a manual export.

Because GST configuration depends on the outlet, the menu and the invoice format, we do not pretend there is one correct switch. The team confirms the setup with you. Visit cafepos.in or email contact.cafepos@gmail.com to book a demo.

The bottom line

A correct cafe bill is the product of three things: the right registration mode, the right classification per item, and a POS that applies both consistently. Get those right and the invoice is boring — which is exactly what a tax document should be. Get them wrong and no amount of reporting will fix the numbers after the fact.

Sources and further reading

GST portal — registration, returns and invoice rules.
Central Board of Indirect Taxes and Customs — notifications, circulars and the CGST rules.
GST Council — rate decisions and Council minutes.

What a cafe POS does — and what to check before you buy — the workflows that decide whether a system survives service.
Table management for a cafe: a floor plan that survives a rush — moving, merging and splitting tabs without losing the room.
Why an on-device studio builds a cloud POS — where CafePOS sits in the catalogue, and why it is deliberately connected.

Common questions

What GST rate applies to a cafe bill?

Standalone restaurant service has generally been taxed at 5% without input tax credit, while outdoor catering and some bundled supplies are taxed differently. Rates and classifications change, so confirm the current rate and your eligibility with a chartered accountant before configuring the POS.

Can a composition-scheme restaurant issue a tax invoice?

No. A composition dealer issues a bill of supply and cannot collect GST separately from the customer. The tax is paid by the business at the composition rate, so the bill should not show CGST and SGST lines.

Is a service charge the same as GST?

No. A service charge is a charge levied by the restaurant and is generally part of the value of supply, so it affects the taxable amount. GST is the tax on that value. A voluntary tip is a different thing and should be recorded separately.

What details must a cafe tax invoice include?

At minimum: supplier name, address and GSTIN; a consecutive invoice number and date; the recipient's details where required; description of the service, SAC code, taxable value, discount, the applicable CGST/SGST or IGST amounts, place of supply, and the total. Exact requirements depend on whether the customer is registered and on the invoice value.

Does the POS need to print a separate bill for takeaway and dine-in?

The tax treatment can differ from the format, so the safer rule is that the bill must state what was supplied and where. Many cafes use one invoice series with a clear order type. Confirm the format your accountant wants before the first service.

How long should GST records be kept?

GST law generally requires records to be retained for six years from the due date of filing the annual return for the year, but the exact obligation depends on your situation. Keep the POS export alongside the filed returns.