Royalty to authors of books

This query is : Resolved

SRIVATS IYENGAR (Querist)
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13 April 2017 hi
Wanted to understand the Service tax implication on Royalty paid to both Indian and foreign authors for books published in India and Sold either in India or abroad both in physical or ebooks format.
Whether the tax implication changes in a GST environment. If yes, what are the changes? Would there be an invoicing requirement from authors and whether authors need to apply either for a Service tax registration or GST registration

Rajesh Kumar

Rajesh Kumar (Expert)
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13 April 2017 An author has copyright. Royalty is paid for temporary/permanent transfer of copyright. Copyright was outside ambit of Service Tax, and no service tax was payable in case of royalty for copyright.
GST covers copyright. Unless exempted, temporary transfer of copyright (royalty to authors) shall attract GST. However, threshold exemption limit in GST is 20 lakhs and an author receiving royalty upto Rs 20 lakhs (presuming he is not making other supplies) is not required to pay any GST.