GST For IT

GST For IT ?

Single GST Rate for IT Software:

GST rate for all kinds of IT Software supply: services, products, supply on media, electronic download and temporary transfer of Intellectual Property (IP) is 18% with full Input Tax Credit (ITC).

Export of Services

Export of information technology is an important source of foreign exchange, with India being the biggest exporter of IT services.

Exports are zero-rated and input taxes paid will be allowed as a refund.

The default rule for place of supply (export of service) is the location of the service recipient if the address of the recipient is available.

So, exporters must ensure that the address of service recipient can be presented before the authorities on request. The typical IT/ ITES services which come under the default rule will be software development, BPO operations, software consultancy, etc. Apart from these, this rule will also apply to other services like software support/ maintenance and intermediary services as there are no exceptions under GST.

Freelancers

Freelancers offering software services such as designing, app development, website designing etc., earlier paid a service tax of 15%. This has now increased to 18% under GST.