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FAQ: Collecting Payments from India for OIDAR Services

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1. What are OIDAR services?
OIDAR (Online Information Database Access and Retrieval) services are digital services provided over the internet or electronic networks with minimal human intervention. Examples include:

  • Advertising on the internet
  • Cloud services, online data storage
  • E-books, movies, music, software downloads
  • Online gaming
  • Supply of images, text, information, and access to databases.

2. Are OIDAR services taxable in India under GST?
Yes, OIDAR services supplied to recipients in India are taxable under GST if the place of supply is India. This applies whether the supplier is located inside or outside India.

3. Who is responsible for paying GST on OIDAR services supplied to India from abroad?
If the recipient is a registered business in India:

  • The Indian recipient must pay GST under the reverse charge mechanism.
  • If the recipient is an individual, government, or unregistered entity (non-taxable online recipient):
  • The overseas supplier is responsible for registering, collecting, and paying GST.

4. What if an intermediary is involved in the supply?
An intermediary located outside India that arranges or facilitates the supply of OIDAR services to a non-taxable online recipient in India will be treated as the supplier and must pay GST, unless certain conditions are met (e.g., the invoice clearly identifies the actual supplier, and the intermediary does not authorize payment or delivery)

5. How does an overseas OIDAR service provider register for GST in India?
Overseas suppliers must register under the Simplified Registration Scheme using Form GST REG-10 with the Principal Commissioner of Central Tax, Bengaluru West. Alternatively, they can appoint a representative in India to register and pay GST on their behalf.

6. What are the compliance requirements for overseas OIDAR suppliers?

  • Registration: As above.
  • Return Filing: File a monthly return in Form GSTR-5A by the 20th of the following month.
  • Tax Payment: Pay the Integrated Tax (IGST) due on the supply.

7. Who is a “non-taxable online recipient”?
A non-taxable online recipient is any government, local authority, governmental authority, individual, or unregistered person receiving OIDAR services for purposes other than business or profession.

8. What happens if the supplier is in India and the recipient is in India?
The default GST rules apply: the supplier charges and collects GST, and the place of supply is the recipient’s location.

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