Guide · OTA commission and taxes

What an OTA booking really leaves you.

The commission, the GST on the commission, and the TCS and TDS on prepaid payouts, worked through for one night, so the payout from Booking.com, MakeMyTrip or Airbnb adds up.

The Reports screen in Host Labs PMS: revenue, GST, OTA costs and net profit for the period

What does an OTA keep from a booking?

Its commission (the rate in your contract), 18% GST on that commission, and, from a booking the guest paid to the OTA, 0.5% TCS and 0.1% TDS of the value before GST. The GST inside the room price is not yours either: it goes to the government.

On a ₹3,150 night (₹3,000 plus 5% GST), prepaid to the OTA at an example 18% commission worked on the price with GST, the OTA pays you ₹2,462.94 and the room earns you ₹2,330.94. The same night booked direct earns ₹3,000.

One ₹3,150 night, prepaid to the OTA, at an example 18% commission
	Commission on the price with GST	Commission on the price before GST
The guest pays	₹3,150	₹3,150
GST inside the price (5%), for the government	₹150	₹150
Value before GST	₹3,000	₹3,000
Commission at 18%	₹567 (on ₹3,150)	₹540 (on ₹3,000)
GST on the commission (18%)	₹102.06	₹97.20
TCS (0.5% of the value before GST)	₹15	₹15
TDS (0.1% of the value before GST)	₹3	₹3
The OTA pays you	₹2,462.94	₹2,494.80
The room earns you, after GST and the OTA	₹2,330.94	₹2,362.80

Commission on the price with GST, or before it

OTAs differ in what they work the commission out on: some take it on the price the guest paid, GST included, others on the price before GST. On a ₹3,150 night at 18%, that is ₹567 or ₹540: ₹31.86 a night between them, once the GST on the commission is added.

Your commission invoice from each OTA shows the rate and the amount it was worked on. Set both per channel in Host Labs PMS (Settings, OTA commission) and every payout and report uses them.

GST on the commission, and when you can claim it back

The OTA adds 18% GST to its commission and fees. Whether it is a cost depends on your room rate: rooms up to ₹7,500 a night are taxed at 5% without input tax credit, so the GST on the commission is a cost; rooms above ₹7,500 are taxed at 18% with input tax credit, so it can be claimed back.

₹3,150 a night (5%, no input tax credit): the ₹102.06 GST on the commission is a cost, and the room earns ₹2,330.94
₹9,440 a night (18%, with input tax credit): the ₹305.86 GST on the commission is claimed back, and the room earns ₹6,300.80 of its ₹8,000 before GST

TCS and TDS on prepaid bookings

When the guest pays the OTA, the OTA keeps 0.5% as GST TCS (section 52 of the CGST Act) and 0.1% as income tax TDS (section 194-O of the Income-tax Act), both of the value before GST, before it pays you. Neither is a cost: both are credited to you and come back against your GST and income tax.

On the ₹3,150 night that is ₹15 TCS and ₹3 TDS. They lower the payout, not the profit, so Host Labs PMS shows them apart from the commission and counts them as credits.

The TCS rate came down from 1% to 0.5% in July 2024, and the TDS rate from 1% to 0.1% in October 2024.

Pay-at-property bookings

When the guest pays you at the property, the OTA collects nothing and pays you nothing: it invoices its commission, with GST, afterwards, and you pay it.

The same ₹3,150 night, paid at the property
	Commission on the price with GST
The guest pays	₹3,150
GST inside the price (5%), for the government	₹150
Value before GST	₹3,000
Commission at 18%	₹567 (on ₹3,150)
GST on the commission (18%)	₹102.06
The OTA pays you	Nothing; you owe it ₹669.06
The room earns you, after GST and the OTA	₹2,330.94

The true profit from an OTA night

The room earns its value before GST, less the commission and fees, less the GST on them when it cannot be claimed back. TCS and TDS are not taken off: they come back as credits.

So the ₹3,150 night earns ₹2,330.94 from the OTA and ₹3,000 booked direct: ₹669.06 more for every direct night at the same price. That is the case for your own booking page.

How Host Labs PMS works it out

Each OTA booking carries its commission, the GST on it, TCS, TDS, the payout and what the room earns, from the rates you set per channel, and Reports adds them up for any period.

Settings: commission per channel, worked on the price with or before GST, with fees, GST on commission, TCS and TDS
Reports: where the money went, from what guests paid to the net profit, with GST payable and OTA costs
By channel: what each OTA cost and earned you, against direct bookings
Stay by stay as a spreadsheet for your accountant: payout, taxes and what each stay earned

Questions

Why is my OTA payout less than the booking amount?

Because the OTA keeps its commission, 18% GST on it, and on prepaid bookings 0.5% TCS and 0.1% TDS of the value before GST. On a ₹3,150 night at an example 18% commission on the price with GST, the payout is ₹2,462.94.

Is TCS deducted by an OTA a cost?

No. It is GST collected at source on your behalf, credited to you, and used against the GST you owe.

What is TDS under section 194-O?

Income tax the OTA, as an e-commerce operator, deducts from what it pays you: 0.1% of the value. It is credited against your income tax.

Can a homestay claim the GST on OTA commission?

Only on rooms taxed at 18% (above ₹7,500 a night), which allow input tax credit. Rooms at 5% have none, so the GST on the commission is a cost.

Is OTA commission charged on the price with GST?

It depends on the OTA and your contract: some work it on the price the guest paid, GST included, others on the price before GST. Your commission invoice shows which.

How much more does a direct booking earn?

At an example 18% commission on the price with GST, a ₹3,150 night earns ₹669.06 more booked direct.

This guide explains how Host Labs PMS works out OTA payouts, with the rates in force in October 2026. It is not tax advice: confirm what applies to your property with your CA, and check your rates against your OTA contracts and commission invoices. Every rate can be changed in Settings.