If a company or person earns money worldwide from his home country, let's say India for clarity, does the person file taxes for all countries he has supplied goods or services to? This in the case of the Apple/Google app stores.

  • I have never found the absolutely perfect answer.Can you please explain this:- lets say an Indian sells in app purchases to someone in Germany through Google which is an Indian company.Does that person file three income tax returns? – compenthusiast Aug 13 '20 at 13:01
  • I think it's a little harsh on a new user to Close this question. It is absolutely clear. There is certainly NO restriction against "simple" questions on SE sites, and, surprisingly, I couldn't really find a dupe. It was very clear OP meant app-store sales, I added 2 words clarifying that. Kindness to new users – Fattie Aug 13 '20 at 13:15
  • Thanks.for it again. – compenthusiast Aug 13 '20 at 13:16

If someone sells in-app-purchases, through Google Play Store or Apple Store, while in India and lets say the payers are in various countries (USA, Australia, France), what happens?

It is extremely simple:

  1. Each person (in USA, Australia, France) pays approximately say about five dollars. (It will vary slightly in each case.)

  2. For each of those customers of the Apple/Google Store they will pay sales tax on the purchase. So for Madame in France, she may pay actually Euros4.13, in fact 0.47 goes to the French government.

  3. Apple/Goog entirely takes care of sending the sales tax to the various governments.

  4. Of the money "left over" after sales tax. Apple/Goog takes 30% of everything.

  5. During the month, your product sales will be X in USD, Y in Euros, Z in AUD and so on.

  6. Apple/Goog will convert ALL of that to INR (recall they already took their 30% AND gave the various governments their cut).

This will amount to a final INR amount for the month, let's say INR 72,100

  1. Finally. Appel/Goog will send YOU a wire transfer for exactly INR 72,100. (BTW you get it at the end of the next month. Your bank will deduct some fees.)

  2. AND they will make a report to the Indian tax service, that you received 72,100.

  3. You ONLY pay income tax IN INDIA to the INDIAN authorities. The fact that Apple sold product to people in France, Australia etc is totally irrelevant. Nobody even knows this. (You won't even "know" this unless for some reason you dig in to the details. You will get an email from Apple saying "We have wired you INR72,100" and that's all you will know.)

You will have absolutely NO CONNECTION to France, Australia, USA etc. and utterly no connection to their tax authorities.

Your ONLY ITR is in India. You will have utterly no connection to any other countries, no other paperwork, no other id numbers, nothing: no connection whatsoever to any other country than India.

Say you are a large business in India that sells (say) tshirts and some of your customers are in the USA, France etc. In that case you will have to process sales tax in those countries. But your ONLY involvement with income tax is with the Indian authorities. As I explain above in the app store case, you have NO, ZERO involvement with sales tax.

  • This system kind of is bad for those countries with the buyers,actually it those countries from which the income is comming and they don't get taxes.So I don't have to worry about 1040 NR. – compenthusiast Aug 13 '20 at 13:15
  • don't forget they get sales tax which is what they want. as you know India is a great major exporting country. if a company in India makes some say cars and sells them in France, it would be ridiculous that France gets income tax! nobody worked in France, nobody made an income in France!! What you are thinking of is VAT or sales tax - of course, France levies sales tax on anything sold in France. but regarding the cars made in India there is no *income" whatsoever involved in France!!!! all work was in India. – Fattie Aug 13 '20 at 13:20
  • Yes.Your logic is correct.I was actually first confused by those american 1040NR forms demanding taxation of non-residents. – compenthusiast Aug 13 '20 at 13:22
  • @compenthusiast: Thats actually what you pay the 30% for to google/apple. To take away all the hassle! – Daniel Aug 13 '20 at 14:51
  • This is to note that google actually asks developers to charge tax in some regions like Japan.Link :support.google.com/googleplay/android-developer/answer/… – compenthusiast Aug 13 '20 at 17:31

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