GST Doubts for my new Web Hosting Business

1. We are providing OIDAR services to 80% of International clients. Do we have to show their transactions in GST Report? Or The GST report should be generated excluding them?

Ans you have to include those transactions also under export of service . You may or may not Charge GST from foreign client. if you have applied Letter of Undertaking (LUT) you can not charge GST from from Foreign Client. .

on the other hand if you have not applied LUT, then you have to charge GST from Foreign Client.

A Proper Tax Invoice should be issued from your end. Payment from client should be credited to your bank account with in 6 Month.

2.We often face Chargebacks or Return orders within 30 days of ordering. How do we deal with them in case the GST has already been filed? 

Ans: you should issued Credit note for the same as sale return in next GST return. If you have paid any tax  it will get reduced your tax liability.

3. We rent our servers from 3rd Party data centers located in the USA, UK, etc. on monthly basis. Do we have to keep a record of all expenses (paid to international companies) and file them in our GST?

Ans: as per GST rules if you have imported any service from outside India you are liable to Reverse Charge (RCM). first you have to pay tax on import of service and the you can take Input for same amount in same month in which you have paid .

also you have to report all expenses under GST and Income Tax both.

4. Is it mandatory for us to register for GST even if our turnover per annum is < 20L for Indian Customers? 

Ans: 20L Limit is not limited for Indian Customer. it is a limit for business on single PAN either With International Customer or Indian Customer

1. You have to report all the sales in your GST return, including your export sales which are 80% in your case. In the case of export of services, you have to issue tax invoices with or without GST. If you have applied for LUT, you can give a Tax invoice without GST and claim the refund of ITC. If you have not used LUT, you must charge GST from the customers. 

2. Issue a credit note against every sales return. Credit Notes have to be mentioned in GSTR 1. 

3. RCM will apply to all imports of services. You have to pay RCM against all the data centre bills and claim ITC of the same in your GSTR 3B. 

4. GST registration is required if your aggregate annual turnover(on the same PAN) during the FY exceeds Rs. 20 Lakhs. 

Hello,

Thank you for your response. A little more clarification needed if you can help me.
 

1. I have to import services like renting servers from International datacenter on monthly basis. As per the law in GST, All international companies dealing with Indian customers has to file IGST in case of registered customer. Okay! I talked to my datacenter billing team and they say, they are not interested in filing GST nor they are governed by Indian laws, use our services at your own.  How do I claim input credit in such case? What to do in such a case?
2. In case of export of services I do have a lot of international customers whose invoices are generated in USD or other international currencies and they make payments through gateways like Paypal, stripe etc. Customer makes payment in USD to PayPal and the payouts are converted &  settled in INR to indian bank account. Now, as per the law for claiming zero rated support or claiming the transaction as import of services, the currency of the payment should be in international currency. In my scenario the payment was collected in USD and settled in INR, does this count as Import of service? 
    
3. Can a individual/ proprietor register under Letter of Understanding if he deals with import/ export of OIDAR services?

Originally posted by : CA Puja Sharma
	1. You have to report all the sales in your GST return, including your export sales which are 80% in your case. In the case of export of services, you have to issue tax invoices with or without GST. If you have applied for LUT, you can give a Tax invoice without GST and claim the refund of ITC. If you have not used LUT, you must charge GST from the customers.  2. Issue a credit note against every sales return. Credit Notes have to be mentioned in GSTR 1.  3. RCM will apply to all imports of services. You have to pay RCM against all the data centre bills and claim ITC of the same in your GSTR 3B.  4. GST registration is required if your aggregate annual turnover(on the same PAN) during the FY exceeds Rs. 20 Lakhs.

Hello,  

Thank you for your response. A little more clarification is needed if you can help me.

 1) I have to import services like renting servers from an International data center monthly. As per the law in GST, All international companies dealing with Indian customers have to file IGST in case of the registered customer. Okay! I talked to my data center billing team and they say, they are not interested in filing GST nor they are governed by Indian laws, use our services on your own.  How do I claim input credit in such a case? What to do in such a case?

2) In the case of export of services, I have many international customers whose invoices are generated in USD or other international currencies and make payments through gateways like Paypal, stripe, etc. The customer makes payment in USD to PayPal and the payouts are converted &  settled in INR to an Indian bank account. Now, as per the law for claiming zero-rated support or claiming the transaction as an import of services, the currency of the payment should be in international currency. In my scenario the payment was collected in USD and settled in INR, does this count as Import of service?   

3) Can an individual/ proprietor register under a Letter of Understanding if he deals with the import/ export of OIDAR services?

 

I will suggest you take paid consultations instead of answers in forums. Answers in forums will be short and mostly without absolute clarity. This is an inherent limitation of forums

I just purchaged hosting plan for my business website and received invoice without GST  Webhosting service provider says I do not have to pay GST since I have GST no. I just want to ask, do i Have to show the invoice in my GSTR1