Do you need GST if you are an affiliate who does media buying?
watch_later 9 months, 1 week ago
Mediabuying is the process of buying adspaces in publisher websites, and advertising products owned by other companies in return of a commission. You are the middleman.
Usually you buy adspaces from websites such as Facebook and Google.
You sell products by CPA networks such as Maxbounty.
And the profit will usually range from 5%-15% of overall cost.
So if I run ads worth $10,000 I will make $11000 on a good month, for example.
How is GST applicable here under the following circumstances -
1) I am an affiliate based in India and the CPA networks that pay me commission are outside India. And I run ads only in foreign geos.
2) I am an affiliate based in India and the CPA networks that pay me commission are outside India. And I run ads only in India.
3) I am an affiliate based in India and the CPA network that pay me commission are also in India.
This is really confusing me, because since my volumes are increasing I need to worry about taxes a lot now.
Of course, with 10% margin the 18%GST on the total revenue will not work as a business model. So I am sure there should be a catch that I dont know about.
Thanks for taking the time to read. Your answer will help several online mediabuyers like me. And there are many in India now :)
GST is payable on every outward supply of goods or services of both.
You are supplying a service, and your service is taxable, so you are liable for GST registration as well as you have to charge GST on your billing.
However, government has introduced a term zero rated supplies. These are nothing but export of goods or services or both.
Zero rated supplies, as name suggest are taxed at 0%.
To understand it better, in fact a very similar question about GST on internet marketing is already answer by Pulkit, you can read that answer.
To summarize your post, you have mainly these question.
I am an affiliate based in India and the CPA networks that pay me commission are outside India. And I run ads only in foreign geos.
It is export of service, GST will be at 0%. However understand the procedure of exports to avoid any non compliance (LUT and Bond concept).
I am an affiliate based in India and the CPA networks that pay me commission are outside India. And I run ads only in India.
It is again export of service and same answer as above.
I am an affiliate based in India and the CPA network that pay me commission are also in India.
This is not an export of service and GST at 18% needs to be charged on value of service.
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