Contract Food Services Under SAC Code 996337
Contract food services cover running kitchens and providing meals under long term contracts for offices, factories, schools, hospitals and other institutions. Service providers manage menu planning, cooking, serving and daily operations for a fixed fee or per plate rate. Under GST, such contract catering services are classified under SAC 996337. This SAC code and its GST rate decide how much GST is charged on these food service contracts. This helps institutions outsource kitchen operations while maintaining regular meal quality.
Contract Food Services GST Rate for SAC Code 996337
Contract food services under SAC 996337 are treated as catering and contract catering services under GST. In the initial years, various ways of pricing meals, subsidies and service fees created complexity in finding the correct GST treatment for such contracts.
After the September 2025 rationalisation, most standard catering, contract food and beverage services under these codes generally fall in the 5 percent slab without input tax credit where they operate like regular restaurant or catering services. In some structured or input intensive models, 18 percent with input tax credit can apply as per the latest notifications.
The table below explains the current GST rate applicable to SAC code 996337 for typical services.
| Code | Description | Old GST Rate (till 21 Sep 2025) |
New GST Rate (from 22 Sep 2025) |
Notes on change / inclusions |
|---|---|---|---|---|
| 996337 | Other contract food services | 18% with ITC | 18% with ITC | Residual contract catering bucket. Standard 18% with ITC; not targeted for change in the 56th Council Annexure. |
While issuing invoices under this SAC code, service providers should clearly show the taxable value of food and service charges, the GST rate and the tax amount so that clients understand the bill clearly. The same SAC code and rate pattern should be used in GSTR 1 and GSTR 3B for outward supplies to keep GST records consistent and easy to justify.
Explore Other SAC Codes Under 9963
This SAC code is part of the accommodation, food and beverage services group 9963, which covers hotel stays, hostels and PGs, student residences, restaurant services, catering services and other hospitality activities. Each six digit SAC within this group is meant to capture a specific type of stay or food service so that GST reporting becomes more accurate.
Below are the major related six-digit SAC codes under parent 9963
In daily use, businesses should select the SAC code that best matches the main nature of their service. If the focus is more on room accommodation, restaurant food, large event catering or contract meal supply, another SAC within 9963 may be more suitable. Correct SAC selection and GST rate application help avoid future disputes, keep the input tax credit position clear and make GST records easier to justify during audits or departmental checks.
Conclusion
Contract food services under SAC 996337 cover long term catering contracts for offices, factories, institutions and hospitals. These services generally attract 5 percent GST without input tax credit for standard meal supply models and 18 percent with input tax credit for certain contract catering structures. Service providers and clients should study their contract terms, apply the proper GST rate on each bill and keep the same classification in GST returns. For subsidised or partially recovered meal charges, it is wise to review the latest GST notifications and consult a tax expert.
Important Disclaimer
The entire content on this page has been arranged to the best of the author's understanding and is subject to periodic updates as per the law for the time being in force. The above does not constitute professional advice or a formal recommendation. While due care has been taken in preparing this content, the existence of mistakes and omissions cannot be ruled out. BUSY Infotech Private Ltd. and its associates will not be held responsible for any loss or damage arising from any inaccurate or incomplete information in this document. We recommend consulting a professional tax consultant before acting on the information contained in this piece of content.