GST for tour operators: setting up Zoho Books
A tour operator's books have three moving parts: money received in advance, costs paid to hotels and transport on the customer's behalf, and the operator's own margin. Zoho Books can keep all three apart if it is set up for them from the start.
Customer advances
Record advances against the customer and the booking as soon as they arrive, and apply them to the invoice when the tour is billed. Advances for services can carry GST at the time of receipt, so set up the tax treatment your accountant confirms.
Hotel, ferry and airline costs
Where you pay these strictly on the customer's behalf and recover the exact amount, they may qualify as pure-agent costs under GST and stay out of your taxable value. Keep them in separate clearing accounts so every rupee paid and recovered can be matched. If you sell a package at one price, the treatment is different.
Profit per booking
A Booking ID reporting tag on every invoice, bill and payment turns profit per tour into a single report, and shows which bookings still have money to collect or pay.
Place of supply
Setting it up in Zoho Books, step by step
- Accounts. Create separate accounts for customer advances, pure-agent recoveries (hotels, ferries, flights) and your own service income, so each one shows on its own line in the trial balance.
- Items. Create service items for your tour packages and your service fee, each with the SAC code and tax rate your accountant confirms, and a non-taxable item for pure-agent recoveries if that treatment applies.
- Reporting tag. Add a Booking ID reporting tag and make it mandatory on invoices, bills, expenses and payments.
- Customer place of supply. Fill the state or union territory on every customer so CGST/UTGST or IGST is chosen automatically.
- Vendor bills. Record hotel and transport bills with the Booking ID so costs land on the right tour, and claim input tax only where your accountant confirms it is allowed.
Common mistakes we fix
- Advances recorded straight as income, which overstates revenue before the tour runs.
- Package prices split into "hotel" and "service" lines on the invoice without the pure-agent conditions being met.
- One clearing account for every supplier, which makes it impossible to see what is still owed per booking.
- Customers created without a state, so the wrong tax type appears on invoices.
Month-end routine
Each month, reconcile the bank feed, review advances that have not been applied to an invoice, run the Booking ID profit report to catch tours with unmatched costs, and run the GST summary before your accountant prepares GSTR-1 and GSTR-3B. With the tags in place, this takes an hour rather than a day.
Operators in a union territory such as Andaman and Nicobar charge CGST with UTGST on local invoices, and IGST to customers registered in other states. Set the place of supply on each customer so Zoho Books picks the right tax.
This guide explains software setup, not tax advice. Rates and the pure-agent conditions should be confirmed by your Chartered Accountant. See how we set up Zoho for tour operators.