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India

India

Explore the requirements and rules that apply to electronically supplied services in India.

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Supplies of e-services to consumers (B2C)

Is a non-resident supplier of e-services to consumers located in this country obliged to register and/or account for local VAT/GST on such supplies in this country?

Yes.

If there is no current requirement, is there any anticipated change to that position?

Not applicable, requirement is already in place.

Is an invoice compliant with the VAT/GST law in the customer's country required?

Yes.

Supplies of e-services to businesses (B2B)

Is a non-resident supplier of e-services to business customers located in this country obliged to register and/or account for local VAT/GST on such supplies in this country?

No, reverse charge applies. The requirement for a non-resident supplier to register in India for tax payment is triggered only in the case where the supply of digital services is to a government or a consumer in India. It is not applicable in the case of B2B supplies as the receiver of the services in India will be liable to pay tax under the reverse charge mechanism.

If there is no current requirement, is there any anticipated change to that position?

No.

If there is not a requirement for the non-resident supplier to register for VAT/GST, are the services subject to VAT/GST withholding by the customer?

No, the customer pays the full price to the supplier, and self-assesses for GST on this price in its GST return.

Where there is a current or future requirement for non-resident suppliers to register and/or account for local VAT/GST or a customer VAT withholding requirement:

When did/will that requirement come into effect?

1 July 2017

What is the applicable annual turnover threshold (in local currency) for that requirement to apply?

Under the GST law, a non-resident supplier providing digital services to a customer (other than a registered person) is mandatorily required to obtain GST registration in India.

Is simplified or standard registration required?

Simplified

Does the requirement apply to all e-services?

No, only to digital services as defined in the law.

Online information and database access or retrieval services is defined as services whose delivery is mediated by information technology over the internet or an electronic network and the nature of which renders their supply essentially automated and involving minimal human intervention and impossible to ensure in the absence of information technology and includes electronic services such as––

  • advertising on the internet;
  • providing cloud services;
  • provision of e-books, movie, music, software and other intangibles through telecommunication networks or internet;
  • providing data or information, retrievable or otherwise, to any person in electronic form through a computer network;
  • online supplies of digital content (movies, television shows, music and the like);
  • digital data storage; and
  • online gaming;

Contacts

Sachin Menon
Partner
T +91 22 3090 2682
E sachinmenon@kpmg.com
 

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