Looking for expert help with Income tax and GST for pet shop owners India? The team at Tax Garden, based in Kondapur, Hyderabad, helps Indian SMEs stay compliant. End-to-end filings, notices, and deadline tracking, all in one place.
Key Takeaways
- Live pets (dogs, cats, birds) and aquarium fish carry no Goods and Services Tax (GST). They're exempt under Notification 10/2025-Central Tax (Rate) from 22 September 2025.
- Dog and cat food is 18%. Leashes, collars and harnesses are 18%. Packaged veterinary medicines are 5%.
- Your exempt animal sales still count towards the GST registration limit, which is Rs 20 lakh in Telangana.
- If you're registered, you must reverse part of the input tax credit (ITC) on common costs like rent (Section 17(2) and Rule 42).
- Most small pet shops can use Section 44AD for income tax: 6% of digital receipts, 8% of cash receipts.
Is there GST on pets and pet food in India? Live animals such as dogs, cats and birds (heading 0106) and live fish (0301) are exempt from GST under Notification 10/2025-Central Tax (Rate), S. No. 6 and 11. Dog and cat food is not covered by the feed exemption, which is limited to aquatic, poultry and cattle feed, so it's taxed at 18%.
A pet shop is one of the few retail businesses where some of what you sell is tax-free and some isn't. The puppy goes out with no GST. The bag of kibble and the collar go out with tax. That mix decides whether you need GST registration, how much input tax credit you keep and how you file. This guide covers the GST rates you'll bill, the exempt-sales rules that catch pet shops out, and how your income tax works for AY 2026-27.
What GST rate applies to each thing you sell?
Comparison
GST Rates for a Pet Shop (from 22 September 2025)
| Item | HSN | GST rate |
|---|---|---|
| Dogs, cats, birds and other live pets | 0106 | Nil (exempt) |
| Live aquarium fish | 0301 | Nil (exempt) |
| Dog and cat food, other pet food | 2309 | 18% |
| Leashes, collars, harnesses, muzzles, dog coats | 4201 | 18% |
| Packaged veterinary medicines (retail packs) | 3004 | 5% |
| Veterinary thermometers | 9025 | 5% |
Source: Notification 10/2025-Central Tax (Rate) S. No. 6, 11, 105; Notification 9/2025-Central Tax (Rate) Schedule I S. No. 234, 488; Schedule II S. No. 144, 639
The exemption covers the animal itself. It doesn't extend to anything sold with it. If a customer buys a puppy with a starter kit of food, a bed and a collar, bill the kit on separate lines at its own rates.
Pet food needs care. Notification 10/2025, S. No. 105, exempts "aquatic feed including shrimp feed and prawn feed, poultry feed and cattle feed". Dog and cat food isn't in that list, and it isn't named in the 5% schedule either. That leaves it in the catch-all entry of Schedule II (S. No. 639, "goods which are not specified in Schedule I, III..."), which is 18%. Fish feed you sell for aquariums is a different product; check whether your supplier bills it as aquatic feed before you price it.
For veterinary medicines, heading 3004 covers medicaments "put up in measured doses ... or in forms or packings for retail sale", and Schedule I, S. No. 234 puts them at 5%. Our GST on medicines guide explains the medicine entries in more detail.
Within your state, split the rate into CGST and SGST: 9% + 9% on pet food and accessories, 2.5% + 2.5% on medicines. A sale to a buyer in another state is IGST at the full rate.
Do you need GST registration if pets are exempt?
It depends on what else you sell.
- Only live animals and fish: no registration needed. Section 23(1)(a) of the Central GST (CGST) Act excludes a person engaged only in supplying exempt goods.
- Animals plus food or accessories: add everything up. "Aggregate turnover" under Section 2(6) includes exempt supplies, not just taxable ones.
If you sell only goods, registration is required once aggregate turnover crosses Rs 40 lakh in most states. Telangana and several other states kept the Rs 20 lakh limit (Notification 10/2019-Central Tax).
Example (Hyderabad pet shop): You sell Rs 12 lakh of puppies and kittens and Rs 10 lakh of food and accessories in a year. Your taxable sales are only Rs 10 lakh, but aggregate turnover is Rs 22 lakh, above the Rs 20 lakh Telangana limit. You need to register.
Selling food or accessories to a buyer in another state, such as through your own website, needs registration from the first rupee (Section 24(i), CGST Act). Our GST registration service can handle it.
The composition scheme caps aggregate turnover at Rs 1.5 crore. A composition dealer can't collect GST on the bill, can't claim ITC and can't sell to other states (Section 10(2)(c), CGST Act). See our composition scheme guide before you opt in.
How much ITC do you have to reverse?
A registered pet shop claims ITC on what it buys. Credit on pet food and accessories you resell is fine, because those sales are taxable. The problem is costs you share across both sides of the shop: rent, fit-out, billing software, a chartered accountant's fees. Section 17(2) of the CGST Act allows credit only for the part used for taxable supplies, and Rule 42 of the CGST Rules sets the formula. Broadly, the share you reverse is exempt turnover divided by total turnover.
Example (one month):
- Pet food and accessories sold: Rs 2,30,000, GST at 18% = Rs 41,400
- Veterinary medicines sold: Rs 40,000, GST at 5% = Rs 2,000
- Puppies and aquarium fish sold: Rs 1,40,000, exempt
- Total turnover: Rs 4,10,000
- Shop rent: Rs 50,000 plus Rs 9,000 GST
Exempt share is Rs 1,40,000 out of Rs 4,10,000, about 34%. So about Rs 3,073 of the Rs 9,000 GST on rent is reversed, and you keep Rs 5,927. Rule 42 works this out each month and trues it up after the year ends. Our Rule 42 and 43 ITC reversal guide has the full formula.
Report exempt sales in GSTR-1 and GSTR-3B under nil-rated and exempt supplies. Leaving them out makes your turnover look smaller than it is, and it hides the reason for your reversal.
Step-by-Step Guide
Setting Up GST for a Pet Shop
Add up all sales
Animals, fish, food, accessories and medicines together. Exempt sales count towards the Rs 20 lakh or Rs 40 lakh limit.
Tag every item
Live animals and fish nil, pet food and accessories 18%, retail-pack veterinary medicines 5%.
Bill kits line by line
A puppy with food and a collar is three lines at three rates, not one exempt line.
Reverse common ITC
Work out the exempt share of turnover each month and reverse that share of GST on rent and shared costs (Rule 42).
File exempt sales too
Show them as nil-rated or exempt in GSTR-1 and GSTR-3B.
Source: Notifications 9/2025 and 10/2025-Central Tax (Rate); Sections 2(6), 17(2) and 23(1)(a), CGST Act; Rule 42, CGST Rules
How is a pet shop's income taxed for AY 2026-27?
Section 44AD of the Income-tax Act 1961 lets a resident individual, HUF or partnership firm (not an LLP) declare a deemed profit instead of keeping full books. Turnover can be up to Rs 2 crore, or Rs 3 crore where cash receipts are within 5% of total receipts. Deemed profit is 6% of receipts through banking channels and 8% of cash receipts. Both exempt and taxable sales count, because GST exemption has nothing to do with income tax.
Example 1 (proprietor, new regime): Turnover is Rs 1.5 crore, with Rs 30 lakh in cash and Rs 1.2 crore by UPI and card. Cash is 20% of receipts, so the Rs 2 crore limit applies, and Rs 1.5 crore is within it.
- Deemed income: 8% of Rs 30,00,000 (Rs 2,40,000) plus 6% of Rs 1,20,00,000 (Rs 7,20,000). Total Rs 9,60,000.
- Tax: nil on the first Rs 4,00,000, 5% of Rs 4,00,000 (Rs 20,000), 10% of Rs 1,60,000 (Rs 16,000). Total Rs 36,000.
- The Section 87A rebate covers tax up to Rs 60,000 where income is up to Rs 12 lakh, so tax payable is nil.
Example 2: Turnover is Rs 2.6 crore with Rs 26 lakh in cash (10% of receipts). The cash share is above 5%, so the 44AD limit is Rs 2 crore and you're past it. You'll keep books and pay tax on actual profit. A tax audit is also needed, because turnover is above Rs 1 crore and cash isn't within 5% (Section 44AB(a)). See our tax audit thresholds guide.
A proprietor on 44AD files ITR-4 if total income is within Rs 50 lakh. On books, it's ITR-3. Our Section 44AD guide covers advance tax and the five-year lock-in if you opt out.
Apart from tax, a pet shop needs a certificate of registration from the State Animal Welfare Board under the Prevention of Cruelty to Animals (Pet Shop) Rules, 2018. Check your state board's current process before you open.
Common mistakes pet shop owners make
- Treating pet food as exempt. The feed exemption covers aquatic, poultry and cattle feed only. Dog and cat food is 18%.
- Leaving exempt sales out of the registration limit. Animal sales count towards aggregate turnover.
- Claiming full ITC on rent. Reverse the exempt share every month under Rule 42.
- Billing a puppy kit as one exempt item. Food and accessories keep their own rates.
- Skipping exempt sales in GSTR-3B. Report them, even though there's no tax on them.
How Tax Garden helps pet shops
We tag every animal, food line and accessory with its HSN and rate, file GSTR-1 and GSTR-3B with your exempt and taxable sales shown correctly, and calculate the Rule 42 reversal each month. See our GST return filing service. We also keep your books and prepare your ITR, under Section 44AD where it suits you; see our accounting and bookkeeping service, ITR filing service and pricing. If your shop is more general store than pet shop, our kirana store owners guide covers it.
