Hi, I live in JAIPUR, RAJASTHAN. Case1: I have started a dropshipping business from my own website (Via Shopify). Customer places an order which gets forwarded to my supplier based in TAMILNADU, who then ships the order to my customer(ONLY IN INDIA). How would GST work? Do I pay GST on my turnover or on my commission/profit? Is it possible to know exact %? 5%,9%,18% etc. Is it possible to save that money? Case 2: Dropshipping via Flipkart/Amazon. In this case the supplier is from RAJASTHAN. F/A takes commission and charges GST on the price. Do I still need to pay GST again? If yes, Is it applied on turnover or applied on commission/profit? Please let me know. I have no idea how it works.
Hi
Case 1
If invoicing to the customer is done by you, GST has to be charged. GST rate shall be the applicable rate for the product.
Case 2
Flipkart would charge GST on entire sales only when the seller is unregistered. Registered sellers have to charge GST.
In both the cases, sale is on your own account therefore GST would be applicable depending on the nature of the product. In case of sale via ECO, TCS would be deducted in your hands.
For detailed discussion, please take phone consultation.
Dear Sir,
Hope you are doing well !!
-The commission income so earned is subjected to GST@18% and all the provisions of GST law is applicable accordingly.
- You need to issue an invoice to the company. If they are paying you a fixed amount and not paying GST in addition, you simply need to do reverse calculation of GST according to the amount so received.
It is advisable to take a phone consultation for detailed discussion.
Hello,
In both cases, since you are registered, you would be liable to charge GST from the end customer.
Case 1: You would issue the invoice to the end customers and charge GST from them(Rate would depend upon the product) The GST charge by the Tamilnadu based supplier from you would be available as a credit while making payment for GST.
Case 2: Since you are registered, you would be liable to charge GST from the end customer through E-commerce Operator. The e-commerce operator would deduct TCS and his commission plus GST on its commission from the amount received from the end customer and remit the balance amount to you. TCS and GST on commission charged by E-commerce operator would be available as credit while making payment for GST to the Govt.
I hope that this answer satisfies your requirements. For further understanding, you can contact us directly or take a phone consultation.
Regards,
CA Hunny Badlani
Dear Sir,
Here are my replies to your queries:
Case 1: As you mentioned that you are currently working as Market Place that helps the customer and seller to buy and sell the products in return of the commission charges.
Accordingly you have to pay GST only on the commission charges charged by you and commission charged by you will be considered as your turnover.
Rate of GST on the above services is 18%.
You mean saving GST, You can save only by the way of GST Input.
Case 2:
Can you please elaborate the case little bit more. so that i can help you in providing the best possible solution.
Thanks and Regards
Divya Chugh
The shopify website helps you sell your own product as you list the products there and then sell the goods to customer. Therefore you would be the ultimate seller and hence the income earned by you is not commission but your profit and people are not registering with you to sell their goods.
Therefore in case 1 you have to show the sale as retail sale and pay GST accordingly.
In the second case also you will have to pay GST on sale price as flipkart only pays GST on its commission and deduct TCS on sale amount in your name and for selling on Flipkart you need to register with GST.
If you need further clarification you can have a phone consultation or you can hire me and we can discuss as we are from same city.
Hope you find the information helpful if you do please rate it 5 and provide your valuable feedback for my improvement.
Thank you.
