Minimum investment needed to start dropshipping from India to US

Hi

There are no requirements as regards minimum investment.

You need not form a company, you can work under your PAN as sole proprietorship.

Income tax shall apply as usual on such business income according to the slab rates.

GST registration requirement shall depend upon how the invoicing will be done in dropshipping. Please share the same. Also, what would be the customer base, India or outside India? How payments shall be made? All facts are important for deciding chargeability of GST.

Dear Sir,

1.GST registration is mandatory as although there is no physical movement of goods, the transaction shall be termed as export. And since it is mandatory to have registration for inter state supplies you will have to get registered under the IGST Act.

2. The charges can vary from CA to CA. If your's is a proprietorship concern you can pay charges of Rs. 2,000 for GST registration.

3. There are no laws specifically for drop shipping but since the transaction is termed as export you shall be required to obtain Import Export Code for your business. We can help you obtain the same.

4. The best advice in case of drop shipping business to ascertain the profit margins properly as GST forms an important component of cost.

Hope this resolves all your queries.

Dear Sir,

To start an online business which shall have transactional revenue, the following registration are required:

1. Company or LLP Registration

While starting an online venture it good to have a private company or LLP to have limited liability protection and improve the ease of doing business. Having a company or LLP would ensure that opening of bank accounts in the name of the business or obtaining a VAT/Service tax registration are easy and fast. Almost all marketplaces allow Proprietorships and Partnership firms to sell on their website. However, there would be no limited liability protection in case of a litigation. Hence, it is best to start selling with an LLP or Private Limited Company.

However, Most people decide to open a private company to substantiate any online activity and this article would cover that aspect alone. To incorporate a private limited company one must approve its name, registered office address, have at least 2 directors with director identification numbers (DINs), must have a minimum authorized capital of Rs.1 Lakh, memorandum of association (MOA) and articles of association (AOA), digital signature certificates (DSCs) wherever applicable, etc. Once these conditions and requirements are fulfilled, a certificate of incorporation is sent by post to the registered office of the newly registered company.

The private limited company is also required to comply with income tax related compliances. These include obtaining permanent account number (PAN), tax deduction account number (TAN), and obtaining of tax identification number (TIN), professional tax if applicable, service tax, etc.

In case you wish to start a proprietary online business, then it is best to start with a company, as it is the only type of entity that can allow for angel funding or equity funding – a must for successful startup ventures. It is very easy to start and only requires you to open a (current) bank account. Filing personal income tax returns and getting intellectual property rights protection is necessary however.

.If you don’t advertise your website and products in India, and you don’t have any customers within the borders of India, you technically don’t need to pay GST.

You only need a GST number when you are selling to people within the actual country of India.

However, that being said, it’s likely the most e-Commerce platforms and associated services will all soon require GST numbers from Indian residents, regardless of your customer base.

It’s important to understand that paying your GST and filing your GST are different.

You don’t have to pay GST if you’re not selling your products to Indians.

However, it is still required to file GST is you’re an India resident doing business.

Dear Sir,

1) For dropshipping business there is no specific law. All you required is to do regular compliance under Income tax, GST and IEC.

2) As you are just starting the business, it is advisable to start as a sole proprietor under your PAN. There is no need for separate registration for sole proprietorship.

3) It appears that all your sale would be to US which is export of goods in India. GST registration is mandatory as you will operate through e-commerce portal.

4) Under GST for export of goods, you need to obtain LUT for export without payment of taxes.

5) Income tax will be applicable on Net profit you will earn from such business.

6) You need to obtain IEC code also.

Thanks

Maximum cost would be Rs.10,000 for starting the business. There is no infringement of any law.

Hello

Only GST registration required. Import export code is not required to obtain.

There is hardly any cost for setting up proprietary firm. Further there are no specific laws for drop shipping law and infringement you need to follow.

Hi

Please get the GST registration and also obtain Import Export Code for your business. We can help you obtain the same.

Regards,

Nikhil

Hi,

1. Please note there are no specific regulations for dropshipping business.

2. You just need to have PAN and GST depending upon your exact flow of Transaction.

3. You don't need any company registration.

4. Legal cost involved in this is very minimal. You can start with 5-10k

Hi,

Hope you are doing well !

1. GST registration is mandatory even if you dont need to pay GST . As it is covered under the definition of export , you will have to get registered for GST. Under GST for export of goods, apply for letter of undertaking (LUT) and export without charging/paying GST. Maximum GST registration cost would be Rs. 2500.

2. There is no requirement to form a company. Yo can start as a sole proprietor under your PAN.

3. As such there is no minimum requirement for investment. You can invest as per you convenience.

4.There is no specific law for dropshipping business, you just need to follow regular rules and regulations under Income Tax, GST and IEC.

5.You need to obtain IEC code .

6. Maximum cost to start entire process would be in range of Rs.15000-Rs.20000.

If you need any further assistance, please let us know.

Best of Luck !

Thanks & Regards,

Payal Chhajed

Yes, GST registration will be required.

The fees will vary from one CA to another.

Also, please clarify how invoicing will be done. It is important for applicability of GST.