Major Source of Income of Tour Operator & Travel Agents:
1. Commission from Airlines’ & any mark up amount from passengers.
2. Sale Tour Packages, both inbound and outbound
3. Travel Related Services like Visa, Passport etc.
4. Hotel Bookings
5. CAR Rental Services, Travel Insurance
6. Railway Reservations
1. Air Ticket & Commission from Airlines Companies:
Basically Air travel agents derive following two type of income so air travel agent will raise 2 invoices.
1. Service fees @ 18% on invoice value to passenger.(1st Invoice)
2. Commission/incentive earning from airlines: (2nd Invoice)
Option A: GST Rate on 18% on Commission on issue of invoice on Airlines
Option B: Domestic Fair: 5 % of Basic Fair i.e. 0.9 % basic fair (18%*5%)
International Fair 10% of Basic Fair i.e.1.8 % basic fair (18% *10%)
Here basic fare means that part of the air fare on which commission is normally paid to the air travel agent by the airline.
- Which Tax to be imposed – IGST/CGST/SGST?
1. Service receiver located in India & registered under GST: Location of service Receiver
2. Service Receiver located in India but not registered under GST but his address is available on records: Location of Service Receiver
3. In case service Receiver address not available: Location of Service Provider
| Location of Supplier | Address of Service Receiver | Travel Place | Place of Supply as per GST | Tax Applicable |
| MH | MH | India | MH | CGST+SGST |
| MH | MH | Outside India | MH | CGST+SGST |
| MH | Delhi | India | Delhi | IGST |
| MH | Delhi | Outside India | Delhi | IGST |
| MH | Outside India | Outside India | Outside India | NO GST |
| MH | Outside India | India | Outside India | Export of Service |
- In Case of commission from Airlines :
Location of Airlines in India – Location of Service recipient
Location of Airlines outside India – Location of service Provider
| Location of Supplier | Location of Airlines | Place of Supply for ATA | Tax Applicable |
| MH | MH | MH | CGST+SGST |
| MH | Delhi | Delhi | IGST |
| MH | London | MH | CGST+SGST |
2. Sale of Tour Packages (Both Inbound & Outbound) :
Inbound Tours: Tours organized by the Tour Operator, within India for the tourist coming from abroad is generally known as inbound tours.
Outbound Tours: Tours organized by the Tour Operator, outside India, for the tourist going abroad is generally known as outbound tour.
Inbound Tours:
1. If tour is on Principal basis then the place of supply shall be location of performance of service i.e. in India & Taxable @ 5% without ITC.
2. However if the tour is on Commission basis then place of supply shall be location of Service Provider i.e.in India but taxable @ 18% with ITC
Outbound Tours:
1. The place of supply in case of principal to principal transaction is when service recipient is :
- Located in India & registered under GST Law – Location of service receiver
- Located in India but not registered under GST law but address is available on record – Location of Service receiver
2. The place of supply in case where tour operator receives commission from another tour operator situated outside India shall be place of tour operator i.e. India
3. Outbound tour sold to a foreigner for visiting another foreign country & the payment received in convertible foreign country is exempt from GST.
Also, Check gst on travel agents.
3. Travel Related Service like VISA, Passport etc
- All govt fees & consular charges paid on behalf of the consumer/client are outside the preview of GST.
- Service charge on the above service shall be subject to GST @ 18%.
- If the service is outsourced from another service provider GST Paid on agent invoice can be claimed as ITC & difference amount can be paid to govt.
4. Commission on Hotel Booking :
5. Commission from Hotel/Cruise:
In case of domestic hotel then place of supply shall be location of hotel.
In Case it is international hotel booking then the place of supply shall be location of service provider.
| Location of Supplier | Location of Hotel/Cruise | Place of Supply for travel agent | Tax Applicable |
| MH | MH | MH | CGST+SGST |
| MH | Delhi | Delhi | IGST |
| MH | London | MH | CGST+SGST |
2. Commission from Passengers : When Service Recipient
1. Located in India & registered under GST Law: Location of Service Recipient
2. Located in India but not registered under GST law but address is available on records : Location of Service recipient
3. Located out of India: Location of Hotel/cruise
| Location of Agent | Location of Pax | Location of Hotel/Cruise | Place of Supply for Agent |
Tax Applicable |
| MH | MH | Delhi | MH | CGST+SGST |
| MH | Delhi | Gujarat | Delhi | IGST |
| MH | London | Gujarat | Gujarat | IGST |
| MH | Delhi | USA | Delhi | IGST |
3. GST Will be 5% without ITC.
i. Car Rental Service, Travel Insurance:
ii. GST applicable for renting of motor vehicle shall be @ 5% with no ITC or 12% with ITC.
iii. If the service provided to a person located in India then the place of supply shall be the location service recipient.
iv. GST for travel insurance is 18% but agent are required to register with IRDA as per Insurance act 1938
6. Railway Commission :
i. GST for booking for railway is 18%
ii. Where the agent is receiving service charges the place of supply shall be location of receipt ant of service.
7. Foreign Exchange:
The following option for determining value of supply for a person providing service in relation to purchase or sale of foreign currency & money changing:
Option A
| When any currency is exchanged from or to Indian Rupees | Value shall be difference between the Buying or selling rate and RBI reference rate, multiplied by total units of currency |
| If in relation to the above case, RBI reference rate is not available | Value shall be 1% of gross amount of INR provided or received by the person changing the money |
| If neither of the currencies exchanged in INR | Value shall be 1% of lesser of two amounts by converting any of the two currencies into INR |
Option B
| Gross Amount of currency exchanged | Value to be considered for supply of Service |
| Up to Rs.1,00,000 | 1% of Gross amount of currency Exchanged, Subject to Minimum amount of Rs. 250. |
| Exceeding Rs.1 Lakhs but less than 10 Lakhs | Rs. 1,000 + 0.5% of Gross amount of currency Exchanged |
| Exceeding Rs.10 Lakhs | Rs. 5,000 + 0.1% of Gross amount of currency Exchanged, Subject to Maximum amount of Rs. 60,000. |
8. Other Misc Services :
1. Services by way of entrance to museum, national park, wildlife sanctuary, tiger reserve or zoo are fully exempted from GST.
2. Entrance fee for entry into Govt monuments are not specifically exempted. However service provided by central Govt,state govt,union territory or local authority are exempted if the consideration for such services does not cross Rs.5,000/-
3. As per Notification No.47/2017 GST, Services by way of admission to a protected monument so declared under the Ancient Monuments and Archaeological Sites and Remains Act 1958 (24 of 1958) or any of the State Acts, for the time being in force are exempted from GST.
4. 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 operator paying 5% GST.
5. Other Services such as portal services, guide services etc attract 18% GST.
6. Service by a specified organization in respect of religious pilgrimage facilitated by the ministry of external affairs of the govt of India under bilateral agreement is exempt from GST.
Note: The views expressed in this article are strictly of the author. The contents of this article are solely for informational purpose. It does not constitute professional advice or recommendation by the author. The author does not accept any liabilities for any loss or damage of any kind arising out of any information in this article nor for any actions taken in
Author Bio
Dear sir
I rly need an explanatiom for my query
We are confuse about the thing weare travel agent or travel operator
For eg
we are selling a package of 1lc to our client
And book hotel from.different hotel.portal and take land service from b2b vendor .so we charge 18 percent tax on only our service not on 5percent on full package
Is it justify or not
i have purchases travel insurance policy through agent. police premium amount is 7055, cgst@5% 634.95 & sgst@5% 635.95 total amount is 8325/-
can i claim input credit
I am working in tour & travel company ,in toru & travel company we pay gst on margin basis @18 % ,here I face a problem and I can not understand that what we have to show in gst R3B and R1 Reimburse + service fee Amount as invoice value or not in filling gst return.
Please suggest me .
I AM NEWLY RUNNING SOLE PROPRIETOR CAR OPERATOR ON RENT. I AM NOT HAVING OWN CAR ONLY ATTACHED CARS. I AM RECEIVING ONLY COMMISSION BUT BILLS AND COLLECTION IN MY TRAVELS NAME. IN THIS CASE I RECEIVED ON GST. SHALL I GO FOR COMPOSITE METHOD OR ONLY TDS TO BE FILED.
Sir,
I have transport agency and I am receiving some interest from deposits made in airlines. whether such interest is taxable under GST or not
if my air ticket basic is rs 20000 and tax is rs 30000 = rs 50000 total and i am billing to my pax as basic rs 20000 and tax is rs 35000 = rs 55000 total…so wanted to know how to pay gst on the markup value of rs 5000 and under which section/column in gst portal without passenger coming to know about it…pls advice
Dear Plz let me know that can I take input credit for Tour & travel agent on booking flight ticket on commission gst amount payment can we adjust any type of input credit with gst tax
we engaged in haj tour operator and every year haj traveller near abour 50-60 and my collction of every haj piligrim rs 200000.00 including all expenses
I am running tours travels business.i am collecting the transaction fees 250 And I am paying 45 gst in b2b corporate company .for ex .actuval base fare 80000 airport tax 20000 total 100000.but I am billing 80000 is base fare 25000 is tax 500 transactions fees 90 gst totally 105590 .i am paying to b2b collecting transactions fees 500 paying 90 rs I am not shown markup to the customers how to pay gst on markup 5000 kindly help me
Plz let me know gst rate on package, hotel, transfer?
5% gst on package
I am working with a Ticket booking since 2 months and I am totally new to this field. We are calculating GST on Base fare + YQ but that is not our income. We consider Booking fees as our income and showing same in Income tax. Now this turover does not match with what we have filed in GSTR1. Where do we show the difference in GSTR9C now.
sir,
I want a start tour and travels company (packege tour ) with own luxary buses.
Pl. give the details the tax calculation like service tax ,gst, if other any. if tour package cost Rs. 20000/- (including Fare, accommodation, Fodding, sight seen,any entry fee
Sir,I hope you guide me.
thanks
if we book a hotel for a client in out of state than can we claim input or not.
if we book hotel for a client in out of state, than can we claim input or not, kindly confirm.
If we opt for Basic Fare gst model for air travel agent then do we have required to pay GST on booking fees received from a customer or only 0.9% or 1.8% as the case may be of basic fare suffice?
i am a sub agent. purchase air ticket from iata. re sale of ticket to customer .cna bill to costomer reambersment bases and second bill for my charges. kindly reply and oblige
If we directly book the ticket from airlines website we are eligible for ITC or not kindly confirm.
VERY HELPFUL INFORMATION IN VERY SIMPLE MANNER IT CLEARS LOTS OF DOUBTS. KEEP IT UP
IF YOU CAN DELIVER SAME THING FOR
GST INPLICATION ON FREIGHT FORWARDER & OCEAN FREIGHT CHARGES IT WILL E VERY USEFUL