GST Registration For Foreign Companies

Goods and Services Tax or GST is an indirect tax in India that is levied on consumption of goods and services. The liability for payment of GST is generally with the manufacturer or service provider in the value chain. However, the the tax is usually borne by the consumer and paid to the supplier supplier along with the price charged. In India, GST rollout is expected to happen from July 1st, 2017 replacing the existing tax structures like VAT, Service Tax, Central Excise, Luxury Tax, etc., In this article, we look at all aspects of GST registration and filing for foreign companies doing business in India.

Do Foreign Companies Require Indian GST Registration?

Yes, any foreign company that supplies goods and/or services to recipients in India, but who has no fixed place of business or residence in India are mandatorily required to obtain GST registration.

In the CGST Act, a “non-resident taxable person” has been defined any person who occasionally undertakes transactions involving supply of goods or services or both, whether as principal or agent or in any other capacity, but who has no fixed place of business or residence in India. And Section 24 of the CGST Act, has mandated that non-resident taxable persons making taxable supply mandatorily obtain GST registration.

Hence, all foreign companies that are supplying goods and/or services to recipients in India are required to obtain GST registration.

Read the guide to obtaining GST Registration in India.

GST Filing for Foreign Companies

All foreign companies that have obtained GST registration are required to file Form GSTR-5 through the GST Common Portal or a GSP. Like other taxpayers registered under GST, the GST return filed by foreign companies must include details of outward supplies and inward supplies. GST filing and payment of GST liability for foreign companies is due on the 20th of each month or within 7 after the last day of the validity of GST registration, whichever is earlier.

Many foreign companies are involved in the supply or providing of Online Information and Database Access or Retrieval (OIDAR) services. Such foreign companies providing OIDAR services to persons in India are also required to obtain GST registration and file monthly GST filing using Form FORM GSTR-5A on or before the 20th of each month.

Instruction for Filing GSTR-5

Form GSTR-5 must be submitted online through the GST Common Portal. 

1. Terms used:
   1. GSTIN: Goods and Services Tax Identification Number
   2. UIN: Unique Identity Number
   3. UQC: Unit Quantity Code
   4. HSN: Harmonized System of Nomenclature
   5. POS: Place of Supply (Respective State)
   6. B to B: From one registered person to another registered person
   7. B to C: From registered person to unregistered person
2. GSTR-5 is applicable to non-resident taxable person and it is a monthly return.
3. The details in GSTR-5 should be furnished by 20thof the month succeeding the relevant tax period or within 7 days from the last date of the registration whichever is earlier.
4. Table 3 consists of details of import of goods, bill of entry wise and taxpayer has to specify the amount of ITC eligible on such import of goods.
5. Recipient to provide for Bill of Entry information including six digits port code and seven digits bill of entry number.
6. Table 4 consists of amendment of import of goods which are declared in the returns of earlier tax period.
7. Invoice-level information, rate-wise, pertaining to the tax period separately for goods and services should be reported as under:
   1. For all B to B supplies (whether inter-State or intra-State), invoice level details should be uploaded in Table 5;
   2. For all inter-state B to C supplies, where invoice value is more than Rs. 2,50,000/- (B to C Large) invoice level detail to be provided in Table 6; and
   3. For all B to C supplies (whether inter-State or intra-State) where invoice value is up to Rs. 2,50,000/- State-wise summary of supplies shall be filed in Table 7.
   4. Table 8 consists of amendments in respect of –
      1. B2B outward supplies declared in the previous tax period;
      2. “B2C inter-State invoices where invoice value is more than 2.5 lakhs” reported in the previous tax period; and
      3. Original Debit and credit note details and its amendments.
8. Table 9 covers the Amendments in respect of B2C outward supplies other than inter-State supplies where invoice value is more than Rs 250000/-.
9. Table 10 consists of tax liability on account of outward supplies declared in the current tax period and negative ITC on account of amendment to import of goods in the current tax period. On submission of GSTR-5, System shall compute the tax liability and ITC will be posted to the respective ledgers.

If you are a foreign company requiring GST registration or GST filing services, get in touch with an IndiaFilings Expert.

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