GST UPDATE

Desk of CA. Praveen Sharma

Series- 408

GST Budget Changes- OIDAR

1- The levy of tax on Online information and Database Access Services (OIDAR) was introduced in India in 2001.

2- OIDAR is a category of services provided digitally through the medium of the internet and received by the recipient without a physical interface with the supplier of such services. The nature of OIDAR is such that it can be provided online from even a remote location outside India to a customer in India.

3- The GST law defines OIDAR enlists certain illustrative services such as advertising, cloud services, e-books, movie, music, software, etc.

4- The proposed amendment would make OIDAR services taxable in the hands of the overseas supplier (or intermediary as applicable) if any unregistered person or persons registered under Section 51 of the CGST Act in India, receives OIDAR services for any purpose.

There are many questions to prove the Taxability:

Whether the transaction qualifies as an OIDAR?

Whether the entity qualifies as a ‘Non-Resident Taxable Person’ in India?

Whether the services are rendered to any person who is not a GST registrant in India or to a person registered solely for deducting tax under section 51 of the CGST Act?

Whether services are rendered by the overseas service provider directly through its website to end customers located in India?

Whethr the digital services are rendered through applications downloadable through the third-party app?

Whether GST is discharged by a third-party app service provider on behalf of the overseas entity?

Regards

CA. Praveen Sharma

https://chat.whatsapp.com/FmAfpAUsnyc0WoiFUv5cSh

Link to check:

https://academy.tax4wealth.com/course/e-commerce-and-oidar-services-under-gst