GST on cab and taxi services in India
If you run a cab or taxi business in India, GST is one of the first things you have to get right on every invoice. This guide explains the rate options, input tax credit, reverse charge and how billing software handles it, in plain language.
The two GST rate options for passenger transport by cab
For renting or hiring of a motor cab that carries passengers, the common structure gives operators a choice between two treatments.
| Treatment | What it means |
|---|---|
| 5% GST | No input tax credit on most inputs. Simpler, lower headline rate. |
| 12% GST | Full input tax credit available on inputs and input services. |
Which one is better depends on how much GST you pay on your own inputs (vehicles, maintenance, fuel where applicable). Many small operators pick 5%; fleets with large input GST sometimes prefer 12% to claim credit. Model both before you decide.
Reverse charge (RCM) when you serve companies
When a non-body-corporate operator supplies renting of a passenger motor vehicle (with fuel cost included) to a body corporate, the tax can fall under reverse charge, meaning the company that hires you pays the GST directly to the government, not you.
This matters for corporate and employee-transport contracts. Your invoice and your client's expectations must match the correct RCM treatment, or you will face reconciliation problems at filing time.
Cab aggregators and e-commerce operators
If bookings flow through an electronic platform (an e-commerce operator), specific provisions can make the platform liable to pay GST on the ride. If you operate your own booking platform or list on aggregators, understand who is liable for the tax on each ride.
How billing software keeps GST clean
Manual GST on hundreds of trips is where errors and notices come from. Transport billing software applies the correct rate per trip, handles RCM flags for corporate clients, generates GST invoices and e-invoices, and produces the return-ready summaries your CA needs.
ZeniaFleets is built in India, so GST, TDS and state rate cards are first class. See our transport billing software to run compliant invoicing across your fleet.