• Dropshipping requirements

Hello,

I want to start dropshipping work through online Shopify store from the vendors located outside India. Products will be shipped directly by the vendor to the customers located outside India. I will not have to handle or hold any inventory at my end.

1. In the beginning, can you suggest any formality be completed?
2. Is it necessary to have a current account in my name or I can operate through my saving account? 
3. Initially, the turnover will not exceed Rs 20 Lacs. So it necessary to have GST registration?

Thanks in advance

Rajbir Singh
Asked 5 years ago in GST

So from the above question what I understand is that you are neither importing the goods now exporting the goods you are going to act as a retailer who doesn't keep the stock and fulfills the order so everything would be done outside India.

Therefore in such case I don't think there would be any GST applicable.

I think the company (Shopify) might ask you to have a current account and I think it would be better to have a current account as you are going to receive foreign income so it would be easy for you to bifurcate.

I think later on you will also be required to get some forms signed by CA and get permission from FEMA. Please consult a FEMA expert regarding this.

Naman Maloo
CA, Jaipur
4265 Answers
96 Consultations

5.0 on 5.0

Hi,

1. You should have a PAN.

2. You an operate through your savings account.

3. Yes, GST will be compulsory.

Abhishek Dugar
CA, Mumbai
3576 Answers
183 Consultations

4.8 on 5.0

Dear Sir,

Hope you are doing well !

1.You don't need to comply so much formalities, just need to have your PAN.

2.You can operate through your saving account.

Current account is more suited individuals who are required to carry out frequent money transfers like businessmen, firms, companies, organizations, public enterprises, etc.

3.Since turnover is not exceed Rs 20 lakh so you do not need to required GST registration.

Thanks & Regards,

Payal Chhajed

Payal Chhajed
CA, Mumbai
5188 Answers
288 Consultations

5.0 on 5.0

Hi,

- You will act as an Intermediary between foreign vendor and Indian customer. You will receive orders from Indian customer and pass on to foreign vendors which will result in to payment of commission to you from foreign vendors.

- The above services will be treated as export of services.

- Open separate current account only for this business. Don't use saving account as it will result in to transactions from multiple sources which will be difficult for you to proove.

- Obtain GST registration.

Thanks

Vivek Kumar Arora
CA, Delhi
4825 Answers
1031 Consultations

5.0 on 5.0

Hi Rajbir,

1.It will be treated as export of services.Export of services are called Zero rated supplies under GST.

2.The current account is mainly opened by people who are into the business which requires frequent deposit and withdrawal. It is advisable that open separate current account only.

2.Yes, GST registration will be compulsory.

Karishma Chhajer
CA, Jodhpur
2450 Answers
29 Consultations

5.0 on 5.0

1. Create your account in Shopify

2. Yes, it is better if you operate through your current account rather than savings account.

3. GST registration is required only if your turnover exceeds 20 Lakhs rupees.

Thanks & Regards

Praneeth Thunuguntla

Praneeth Thunuguntla
CA, Guntur
56 Answers
1 Consultation

Not rated

Hi Rajibir,

1. You will need GST and Pan.

2. You can operate it through savings account also. There is no issue.

3. GST registration is mandatory for your irrespective of threshold.

Lakshita Bhandari
CA, Mumbai
5687 Answers
909 Consultations

5.0 on 5.0

Hello Rajbir,

1. Please get the GST and PAN.

2. Savings account is also fine.

3. Yes, GST registration is mandatory irrespective of threshold.

Nikhil Khanna
CA, Mumbai
1429 Answers
19 Consultations

4.8 on 5.0

Hi

1.Take GST and PAN

2.Not necessary ,but its advisable to take

3.Yes GST is mandatory in case of online business,irrespective of threshold limit of 20 lacs

Swati Agrawal
CA, Mumbai
1146 Answers
7 Consultations

5.0 on 5.0

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