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I'm an app developer based in India, and I will be selling my apps through an app store. As I understand, developers are subject to a service tax of 15% once their revenue crosses a threshold of ₹10 lac.

  • Does Apple deduct and pay the service tax on my behalf, or should do it myself?

  • Is it 15% of the sale price of the app, or of my proceeds after Apple takes its 30% cut?

  • Does the ₹10 lac threshold apply to my revenue or the entire revenue of the app store in India?

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The Goods and Services Tax(GST) is a revolution in indirect taxation and it has the effect of changing the overall tax complexities involved in India. The effect on Android app developers on GST will be as follows:

1) If you are providing app development as a service to the clients in India, then the normal GST rate of 18% will apply. However, if the annual revenue in the previous year from that service is less than Rs.20 lakhs [Rs.10 lakhs for special states (Assam, Mizoram, etc)], then the developers might opt for non-registration in GST. Also, you will not be eligible for Input Tax Credit (ITC).

2) If you are selling apps through platforms like Google Play Store or Apple Store, then it will be considered as normal sale and GST will be charged on the sale price at the rate of 18%. The app developer, however, will have to submit the GST amount to the Government by themselves. Here also, not necessary to register!

3) If the app developer is providing services to clients based outside India, then if it covers the requirements of “Export” as per GST Act then it would be considered as exports and are 0% taxation (Government gives more benefits and pay you for exports!).

Each word mentioned above is correct up to 21/04/19 11:48 IST.

The answers may differ every six months as constitution changes twice a year, but stable since last year.

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