Gst treatment of promotional scheme of restaurant

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GST Treatment of Promotional Scheme of Restaurant 

Sales: -

  1. If we give discount on original value of Burger/ puff.
  2. If we give free promotional gift along with Burger/puff
  3. If we give free Burger/puff (like- on order above Rs…)
  4. If customer return the Burger/puff with/without gift
  5. If changes in value after the goods are delivered (i.e. some material return back by customer or incorrect value charged)

 

Purchase: -

  1. If raw material returns back to supplier (i.e. Bad quality of Milk/Butter or some other reason) etc.
Replies (2)
In the case of milk, I think that company directly settles the damaged milk on the spot.

Hello Ratan, I'll try to answer to the best of my knowledge of GST Law. 

 A1) If you are selling the food products at a discounted price, GST shall be levied on the discounted price itself.

 A2) Giving anything free i.e. without consideration to an unrelated person does not fall in the definition of “supply”. There no GST is chargeable on value of free product.

A3) As in the above case, no GST is chargeable in this case also. 

A4) If customer returns back the sold product, GST needs to be reversed.

A5) Credit note needs to be issued in case of any change in value and accordingly GST will be charged or reversed. 

A6) In case of restaurant business, you won’t get any ITC for the purchases made. So if that product is returned to the supplier, no effect with regards to GST.

I hope I was able to help you. But I’ll still recommend you to consult some professional.

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