05 June 2018
Importer of services will have to pay GST on reverse charge basis.
Under GST, supply of goods and/or services in the course of import into India is be deemed to be supply in the course of inter-State trade or commerce, attracting the levy of IGST. Thus, all import of services into India will be treated as deemed inter-State supplies and would be subject to GST.
Though the IGST Act makes it clear that GST is applicable on imported services, calculating GST on imported services is slightly more complex. To find if an import of service would be liable for payment of GST, a few tests as under have to be applied.
1) Only import of services for consideration is considered a supply under the CGST Act, 2017. Thus, import of services without consideration would not be considered a supply and GST would not be levied. Thus, import and use of free services from Foreign Corporations like Whatsapp, Facebook and Instagram by all of us, without any consideration, are not liable for tax under GST. 2) However, if the import of service from a related person in the course or furtherance of business would be treated as supply, even if it is made without any consideration. Thus, if some services are imported or used by an Indian Branch of a foreign company, even without any consideration, it will be treated as a supply and liable for payment of GST.
Since I don't know description of services received by you from foreign entity, I will not comment on that. However, in general it RCM is applicable.
05 June 2018
Thanks CA Himanshu Ojha for detailed reply. What about Individuals who buy google space. Because as per GST Act, the ceiling limit of Rs. 20 lakh is not applicable for importer of services.
05 June 2018
Thanks CA Himanshu Ojha for detailed reply. What about Individuals who buy google space. Because as per GST Act, the ceiling limit of Rs. 20 lakh is not applicable for importer of services.
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