Import of Services under GST

Import of Services under GST

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Import of Services under GST

Import of services refers to supply of a service, wherein the supplier is located outside India, the recipient is located in India, and the place of supply of service is in India. Import of services attract GST under reverse charge basis. Under GST, any person required to pay GST on reverse charge basis is mandatorily required to obtain GST registration and file GST returns, irrespective of any other criteria. Hence, its important for all persons importing services into India to be aware of regulations pertaining to import of services under GST.

Know more about GST reverse charge.

OIDAR Services

OIDAR services or Online Information and Database Access or Retrieval Services attract GST. Persons providing OIDAR services are mandatorily required to be registered under GST.

Import of services with consideration whether or not in the course or furtherance of business, will be considered as a supply. Business test is not required to be fulfilled for import of service to be considered as supply. Hence, import of service by most businesses would be taxable under GST on reverse charge basis.

In respect of import of online information and database access or retrieval services (OIDAR) by unregistered, non-taxable recipients, the supplier located outside India will be responsible for payment of taxes. Hence, the service provider outside of India will have to obtain non-resident taxable person GST registration and file monthly GSTR-5 returns.

Supply to SEZ

Supply of goods or services or both to a Special Economic Zone Developer or a SEZ unit will be treated as inter-state supply and will be subject to levy of IGST.

Import of Services by Related Entities

Import of services by a taxable person between related entities in the course or furtherance of business will be treated as supply, even if it is made without any consideration. Thus, import of some services by an Indian branch or foreign subsidiary from their parent company, in the course or furtherance of business, even without consideration, will be a supply and subject to GST.

In case of supply by a related person, where the supplier of service is located outside India, the time of supply will be the date of entry in the books of account of the recipient of supply or the date of payment, whichever is earlier.

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