IndiaFilings » Learn » GST on Freelancers

GST on Freelancers

GST on Freelancers

GST on Freelancers

India has emerged to be a hub for passionate freelancers and thereby, the freelance industry has been on a constant growing phase. However, it goes without saying that this particular industry is an unorganised sector and lacks clear and specific rules and regulations. The freelance industry in the country comprises of professional freelancers of various professions, bloggers and consultants. From a wide range of interests starting with travel and food to technology and fashion, freelancing has been a platform for people to display their talents and be their own boss. With the implementation of Goods and Services Tax (GST), there has been quite a confusion and the new rules and regulations of the tax concerning this market has been vague. This article is a GST Guide for Freelancers with the intent to simplify the complexity around the subject.

Freelancers in India

Over time, the freelance sector has come out to be one of the highest revenue earning sectors in the industry. Hence, it was bound to be taxed under the law. It is widely known that freelancers are required to obtain GST registration and pay 18 per cent Goods and Services Tax for any income earned from these services. This is implemented to those who earn an income that exceeds the threshold of INR 20 Lakhs. Know more about GST turnover limit.

Receiver and Supplier

As a vendor, an individual is required to collect GST on an individual or an entity who purchases their services and deposit the tax to the government.

GST Registration for Freelancers – Exporting Services

According to Section 24 of the Central GST Act, an individual who earns an income from outside the country or the state, is liable to get themselves registered with GST and no threshold limit is applicable. To be more precise, the exemption of INR 20 Lakhs is only relevant to small business who earn their revenue from clients and entities present within the state. Hence, GST registration is mandatory for every freelancer who exports services outside the state or the country and earns revenue from the same, with any exemption limits. As indicated in the GST laws formulated by the Government, freelancing services are categorised under database access and online information.


When a freelancer fails to register themselves for GST, they would be liable to pay penalties. The penalty for not registering goes upto INR 25,000, and a penalty of INR 100 would be applicable for not filing GST returns.

Place of Supply

The place of supply would generally be the location of the service recipient. The service recipient is considered to be located in India under the following conditions.

  1. If proof of location is submitted online by the service recipient is well within the taxable territory.
  2. If the taxable territory has issued a means to make the payment settlements, this could include debit cards, credit cards, smart cards or value cards as well.
  3. If the billing address of the service recipient is well within the taxable territory.
  4. If the IP address of the device used by the service recipient is within the taxable territory.

Claiming GST Refund

Below is a quick brief on how a freelancer may claim a GST refund.

  1. File Form GST RFD-01 within two years from the date of export of services.
  2. The form is submitted and reviewed by the concerned authorities and issues an acknowledgement within 15 days under Form GST RFD-02.
  3. If approved, the concerned department would initiate a refund within sixty days from the date of applying.