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Goods and Services Tax (GST) on Domain Names in India

Labeled as information in Domain Industry News started by anantj, Jul 3, 2017.

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  1. anantj

    anantj Top Member VIP

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    The Indian government recently implemented a historic major overhaul of the tax system by implementing the Goods and Services Tax (GST). With the advent of GST, the earlier taxation regime has been replaced with a relatively simpler (albeit complex in its own right) tax structure. While I'll not get into details of the GST itself, there is a material and direct impact on Domain names and similar digital products (i.e. Hosting, SSL certs etc):

    The earlier tax rates on Domain names was 15% + some cess. Now, under GST, the tax on Domain names will be 18% which effectively increases the price of domain names for buyers from India. GoDaddy has already implemented this I think (they don't break out the taxes so I'm not sure). Similarly, BigRock has split their operations between PDR for registrants from outside India and Directi for registrants from within India.

    Long term, expect cost of domain investment to only go up in India as cumulative effect of GST makes an impact.
     
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  2. ramkumaritrvs

    ramkumaritrvs RapidNames.com PRO VIP

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    It's time to switch abroad services like namesilo.com, epik.com to save 18% fees.
     
  3. anantj

    anantj Top Member VIP

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    Indeed. But GoDaddy cannot fully be avoided if you're an auctions user as they have some of the largest auction inventory.
     
  4. siya

    siya Established Member

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    It's a good thought but we cannot avoid GoDaddy and BigRiock because they are the largest auction inventory in india with almost all domains which we prefer.
     
  5. andNames

    andNames Shailendra Mishra VIP

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    For some strange reason Godaddy India is charging 12% GST not 18%.
    Furthermore, you can avoid GST if you buy from Godaddy US in USD. Isnt it?

    My question: Forget domain registration for a while. Do you charge GST on domain sales of your own. especially high (end use) sales?
     
  6. anantj

    anantj Top Member VIP

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    You need a valid US Address and payment method to register it from GD US in USD

    You should
     
  7. andNames

    andNames Shailendra Mishra VIP

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    At what rate? Isnt it an export if you are selling to someone outside India (totally valid foreign sale) GST applies to buyers from India only.
     
  8. Joe Nichols

    Joe Nichols Common sense consultant VIP

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    If the GST in India works anything like the GST in Canada, then businesses who collect and submit (to the government) GST on their sales may be able to get that money back in tax credits (as long as the domain is used in taxable business operations).
     
  9. Joe Nichols

    Joe Nichols Common sense consultant VIP

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    Again, if the rules are similar to Canadian rules, you are only required to charge GST on your sales if you make a certain amount of income per year in taxable sales.
     
  10. pokainc

    pokainc Top Member VIP ★★★★★★★★★★

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    @Joe Nichols it also makes a difference if you're sales are to Canadian buyers or other times it's even province specific, depending on the tax... I am from Canada, but 99.9% of my sales are to people around the world.. so I don't need to charge tax.. luckily
     
    Last edited: Jan 23, 2018
  11. anantj

    anantj Top Member VIP

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    Not a certified CA so you will need to consult with a GST Expert for advice on when to charge GST
     

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