GST is applicable in India from 1st July 2017 and it is also applicable to Bloggers, Youtubers, Affiliate Marketers and all other types of Freelancers and the rate of GST in such cases is 18%. There is no confusion regarding this and it is fairly clear that GST @ 18% is applicable on all Bloggers, Affiliate Marketers, Youtubers and other freelancers.
However, in case of export – no GST would be payable. But no GST does not mean that there would not be any compliance requirements. All compliances and procedures would be required to be followed and the same have been discussed below.
GST on Bloggers, Affiliate Marketers, Youtubers & Freelancers (For services within India)
In case the services are provided in India – GST @ 18% would be applicable on the services provided by bloggers, affiliate marketers, youtubers and other types of freelancers. They would be required to collect this GST from their clients and then deposit the same with the Govt.
The mechanism of working of GST has been explained with the help of the following image:-
GST on Services within the same state
If the service has been provided in the same state i.e. both the supplier and the recipient are based in the same state, there would be 2 components of GST which would be applicable i.e.
- Central GST (CGST) @ 9%
- State GST (SGST) @ 9%
The total tax would remain the same i.e. 18% but it would be split into 2 parts i.e. CGST & SGST.
Exemption from GST in case of Transaction within the same state
In case total turnover of the blogger/affiliate marketer/youtuber/freelancer is less than Rs. 20 Lakhs for the whole year – it is not mandatory for him to register for GST and pay GST.
However, for service suppliers from the following states – the threshold limit is of Rs. 10 Lakhs instead of Rs. 20 Lakhs:-
- Arunachal Pradesh
- Jammu & Kashmir
- Himachal Pradesh
For service suppliers of all other states, the threhhold limit is Rs. 20 Lakhs.
For services provided from one state to another
In case of services which are provided from one state to another, i.e. the supplier and the recipient are based in different states, only a single component of GST would be applicable i.e.
- IGST @ 18%
The total tax payable in case of both inter-state transaction as well as the same state transaction would be the same i.e. 18%. Its only that the components would change.
No Exemption from GST in case of Transaction from one state to another
In case of inter-state transaction, there is no exemption from payment of GST and the GST Registration is mandatory and GST is required to be paid even if the transaction is of Rs. 1
GST on Bloggers, Affiliate Marketers, Youtubers & Freelancers (For services outside India – Export of Services)
In case of export of service i.e. when the supplier of service is in India and the Recipient is outside India, GST @ 18% would not be levied. GST @ 0% would be levied in such cases.
However, GST Registration would be required in such cases and Return filing & all other compliances would also be required to be followed.
Services can be exported outside India by using any of the following options:-
Option 1: Export Services outside India on payment of IGST and then claim refund.
Option 2: Export Services outside India without payment of IGST by furnishing bond or Letter of Undertaking (LUT)
- Recommended Read: Procedure to submit Bond/ LUT for Exports without Payment of GST
Due Dates for Payment of GST & GST Return filing
|Date||Return Form Name||Details to be furnished|
|10th of next month||GSTR 1||Details of all Sales made in the previous month|
|15th of next month||GSTR 2||Details of all Purchases made in the previous month|
|20th of next month||GSTR 3||Consolidated Return and Payment of Tax|
How to raise a GST Invoice
GST Invoice would be required to be raised for all services provided and the invoice should very specifically mention the Invoice No., Date of Invoice, Value of Services provided, Rate of GST and several other items.
There is no prescribed format for raising a GST Invoice. The govt has only mandated that some items should be mentioned on all invoices.
The details of all invoices are required to be mentioned in the GST Return and therefore it is important that all invoices are properly prepared as per the guidelines released by the Govt.
- Recommended Read: How and When to raise a GST Invoice – Explaining all Practical Scenarios
Penalty for Non-Compliance
In case of non-compliance with any of the above mentioned provisions, the following penalties would be levied:
- For Non-Registration: Rs. 25,000
- For late filing of GST Return: Rs. 100 per return per day
- For short/non payment of GST: 10% of tax amount (min of Rs. 10,000)
- For fraud while filing GST: 100% of the tax amount evaded/ short deducted (min. of Rs. 10,000)
Other Relevant Points
- Income Tax is different from GST and you would be required to pay both Income Tax as well as GST.
- The service supplier can claim the benefit of Input Tax Credit of the GST paid by him.
- If you have raised an Invoice but the payment for the same has not been received, you would still be required to deposit the GST with the govt for the month in which the invoice was raised.
- Bloggers, Freelancers, Youtubers, Affiliate Marketers and all other type of Service providers cannot opt for the GST Composition Scheme.
- GST on Adsense Income would be levied in the same manner as mentioned above. Adsense Income is considered as Income from sale of Ad space to Google Adsense.