Subject: Digital Payments

Dear All,

My client's digital payments will be received from the e-commerce sites that will be selling their products through. Currently, they will be using two platforms:

1) Intel AppUp

2) Digital River

Basic Info

1) There is a software developer

2) There is a platform (Intel AppUp, Digital River)

3) The developer submits his product to the platform

4) The platform collects payments from individual customers who come to the platform, retains its margin, and transmits the funds to the developer when a certain amount of sale is made

5) The platform will also collect taxes over and above the cost of the product. In the U.S., different states have different taxes

6) The developer normally receives funds from an intermediary like PayPal

7) PayPal will also deduct its own margins


Thoughts that should come to my mind

1) Any taxes

2) How will the company raise an invoice, on whom

3) How will the company treat margin deductions

4) Will there be any RBI implications- example, product is for 2.99$ per license. Net amount would be less deductions of platform, and payment gateway (PayPal)

5) Will the company invoice net amount? Will that be correct on an accounting/rbi/technically basis

6) Will the company invoice each time payment will be received

7) What kind of certification will we need. From whom. STPI?

8) STPI does not certify any invoice that is lower than USD 25,000-.

9) Would it be correct to invoice the platform

10) They may not accept an ‘invoice’, as they are not ‘buyers’

11) The Company cannot invoice an individual buyer, since, to the best of my knowledge, the platform will not provide the details


I request all fellow members who has this type of client to help me with your views.

Warm Regards,

CA ABDUL QAYOOM ABBASI

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