§ 1
When the OIDAR rules apply
OIDAR services are services delivered over the internet with minimal human intervention: SaaS, digital content, online gaming, e-books, cloud services, online advertising and similar. When an overseas supplier provides them to a 'non-taxable online recipient' in India (an individual consumer, or a business not registered for GST), the supplier itself is liable to pay IGST.
When the customer is a GST-registered business, the customer pays tax under the reverse charge instead, so the supplier's obligation turns on identifying who its Indian customers are. The law presumes a customer is in India if two non-contradictory indicators, such as billing address, card issuer, IP address or SIM country code, point to India.
There is no registration threshold for OIDAR suppliers. A business with even small Indian consumer sales is expected to register.
§ 2
The law that applies
| IGST Act, 2017, section 14 and the OIDAR definition | Liability of the overseas supplier and the tests for 'non-taxable online recipient'. |
|---|---|
| CGST Rules, 2017 | Simplified registration and the monthly GSTR-5A return. |
§ 3
Issues and how we solve them
The problems that most often hold up or complicate this work, and how we deal with each.
Issue 1
The business cannot tell which Indian customers are registered businesses.
Our approach
We help set up checkout to capture a GSTIN from business customers and validate it, so B2B sales move to reverse charge and only consumer sales are taxed in the return.
Issue 2
The supplier has no Indian bank account to pay the tax.
Our approach
Tax can be paid from abroad through the GST portal's international payment options; we coordinate the payment cycle so each return is filed and paid by the 20th.
Issue 3
Sales data from payment processors does not match the returns.
Our approach
We build a monthly reconciliation from the billing system to the GSTR-5A figures, including refunds and currency conversion at the prescribed rate.
§ 4
Process and timeline
- 1
Assessment
Week 1Confirm that the services are OIDAR and estimate the Indian consumer revenue.
- 2
Registration
Weeks 1–3Simplified registration, with a representative in India where appointed.
- 3
Monthly
MonthlyCompute tax on Indian consumer sales, pay IGST and file the return.
Filing: GSTR-5A by the 20th
§ 5
Our scope of work
Included
- OIDAR applicability review
- Registration
- Representative services where required
- Monthly returns and payment coordination
- Data reconciliation
- Notice responses
§ 6
Questions
Is there a turnover threshold for OIDAR registration?
No. An overseas supplier of OIDAR services to non-taxable online recipients in India must register regardless of the amount of sales.
What if all Indian customers are businesses?
Registered business customers pay GST under the reverse charge. The supplier should still keep evidence of their GST registration.
Does registration create a permanent establishment for income tax?
No. GST registration is a separate obligation and does not by itself create a taxable presence for income tax. Equalisation levy and income tax positions should be reviewed separately.
Prepared by CA Utsav Dogra, Chartered Accountant, ICAI M. No. 542375, SU and Company · Last reviewed 4 November 2026. General information only, based on the law as it stood on that date; it is not advice for any particular case.