GST & export of services
This query is : Open
02 September 2021
Hi,
I want to start with POD business on teespring and redbubble. Both these platforms are based outside India. As a seller, I will upload my artwork on these platforms, will create a virtual listing of products & set selling price for each product. Customers(who are also from outside India) visit and place order with these platforms.These platforms manufacture and deliver orders to customers and after deducting a base price for manufacturing from selling price, the remaining amount will be paid by platform to seller i.e. me by payout through PayPal.
After a lot of hassle, I came to know that this will be the export of services( zero rated supply) and all transactions need to be shown under GST.
I am just receiving payout (showing profit earned by me) from these platforms through PayPal
I am not issuing or not receiving any invoice. Even customer details are not shared with me.
So my questions are
1.How to show this profit under gst as I have only payouts showing profit earned by me (i.e. selling price minus base price) from those platforms?
2. I don't have any invoices but in gstr1 Invoice details need to be filled. How to address this issue?
It would be of great help if you could answer query.
Thank you
I want to start with POD business on teespring and redbubble. Both these platforms are based outside India. As a seller, I will upload my artwork on these platforms, will create a virtual listing of products & set selling price for each product. Customers(who are also from outside India) visit and place order with these platforms.These platforms manufacture and deliver orders to customers and after deducting a base price for manufacturing from selling price, the remaining amount will be paid by platform to seller i.e. me by payout through PayPal.
After a lot of hassle, I came to know that this will be the export of services( zero rated supply) and all transactions need to be shown under GST.
I am just receiving payout (showing profit earned by me) from these platforms through PayPal
I am not issuing or not receiving any invoice. Even customer details are not shared with me.
So my questions are
1.How to show this profit under gst as I have only payouts showing profit earned by me (i.e. selling price minus base price) from those platforms?
2. I don't have any invoices but in gstr1 Invoice details need to be filled. How to address this issue?
It would be of great help if you could answer query.
Thank you
02 September 2021
In GST , you have to raise tax invoices and file returns-gstr1 and gstr3b.If you are getting payout in FC then it can be export of service.
If any further clarifications, you may want to discuss in person.
If any further clarifications, you may want to discuss in person.
02 September 2021
1 Consider it as royalty. File letter of undertaking in GST portal no GST applicable. It will fall under export.
2 Raise invoice and enter in GSTR 1.
2 Raise invoice and enter in GSTR 1.
02 September 2021
I don't think his art work of a product can be classified as Royalty because he is making the design of the product which goes for sale with the product.
02 September 2021
As per my opinion, as per Schedule II of CGST Act, No.5 (c) - temporary transfer or permitting the use or enjoyment of any intellectual property right - accordingly your artwork is a supply of service.
Considering, the supplier is located in India, recipient is located outside India, i.e. the platform which uses your artwork, and you receipt the payment in convertible foreign exchange, and the place of supply is the location of the recipient of services according to section 13 (2) of IGST Act, is outside India, your services qualifies export of service.
According to section 7(5)(a) of IGST Act, your supply is inter-state supply where the supplier is located in India and the place of supply is outside India (location of recipient in your case).
According to section 24 (i) of CGST Act, persons making inter-state supply is required to take GST registration.
Since your supply qualifies export of service, you need to file LUT to supply without payment of IGST and issue Bill of Supply.
Considering, the supplier is located in India, recipient is located outside India, i.e. the platform which uses your artwork, and you receipt the payment in convertible foreign exchange, and the place of supply is the location of the recipient of services according to section 13 (2) of IGST Act, is outside India, your services qualifies export of service.
According to section 7(5)(a) of IGST Act, your supply is inter-state supply where the supplier is located in India and the place of supply is outside India (location of recipient in your case).
According to section 24 (i) of CGST Act, persons making inter-state supply is required to take GST registration.
Since your supply qualifies export of service, you need to file LUT to supply without payment of IGST and issue Bill of Supply.
02 September 2021
As these sites are providing platforms along with manufacturing & delivering goods to the customers & Customer details are not shared with me. So if I have to issue invoice , whom I am supposed to issue it?
Further, do I have to issue those invoices for gst purpose only, as I won't be able to send them to platform as well as customers.
What should be value of supply in the invoice , 1. selling price 3. Selling price- base price = profit.
If I show selling price in invoices and in fact I am only getting profit,so there would be discrepancy in gst and income tax filling. How to address issue.
Thank you
Further, do I have to issue those invoices for gst purpose only, as I won't be able to send them to platform as well as customers.
What should be value of supply in the invoice , 1. selling price 3. Selling price- base price = profit.
If I show selling price in invoices and in fact I am only getting profit,so there would be discrepancy in gst and income tax filling. How to address issue.
Thank you
02 September 2021
Issue invoice in the name of platform for GST purpose only for the amount received no need to send the invoice.
02 September 2021
Suppose, date on payout - 4th august 2021 which shows Profit paid for combined sales made for a period from 1st June 2021 to 31st July 2021.
Money got deposited in my bank account on 7th August 2021.
My questions are
1. What should be a date on invoice?
2. Do I need to issue a separate invoice for each sale or a single invoice for the total period i.e. 1st June 2021 to 31st July ?
3. Within how many days of payout issuance, I need to generate invoice?
4. Ttbr of which date to be applied for currency conversion?
5. Should details of this invoice be filled in gstr1 for September 2021 month
Money got deposited in my bank account on 7th August 2021.
My questions are
1. What should be a date on invoice?
2. Do I need to issue a separate invoice for each sale or a single invoice for the total period i.e. 1st June 2021 to 31st July ?
3. Within how many days of payout issuance, I need to generate invoice?
4. Ttbr of which date to be applied for currency conversion?
5. Should details of this invoice be filled in gstr1 for September 2021 month
02 September 2021
1 Make invoice on 7th August.
2 single invoice okay.
3 On or after the payment date.
4 Adopt actual payment conversion rate.
5 Fill in August month.
2 single invoice okay.
3 On or after the payment date.
4 Adopt actual payment conversion rate.
5 Fill in August month.
03 September 2021
In your case, the recipient for you is the PLATFORM. Invoice should be issued within 30 days from the date of supply of service or on the date of the receipt of payment whichever is earlier. In your case, you can issue invoice on the date of the receipt of payment.
The details of the invoices should be shown in GSTR 1 for the month in which it is raised.
The details of the invoices should be shown in GSTR 1 for the month in which it is raised.
03 September 2021
Thank you so much for answering my questions
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