Income from Social media post

[VIGNESH]

sir.one of my client is promoting his own products in youtube and receiving amount for each such post from youtube, is this taxable under GST?

[KASTURI SETHI]

Dear Sh. Vignesh Ji,

Will you please elaborate your query ? The query is too brief to reply.

[VIGNESH]

Sir.my client is running a retail Jewellery shop and he is promoting his products by advertisng the jewellery he has in his shop, he has received amount from youtube for his posts. Will this atract GST?

[Shilpi Jain]

Generally the money that he receives is for the number of clicks. It would generally be in the nature of export of services assuming that the amount is received in foreign currency from YT abroad.

[KASTURI SETHI]

Shri Vignesh Ji,

Has your client received the amount in foreign currency ? Pl. confirm.

[VIGNESH]

Guruji. s Money has been received in foreign currency.

[KASTURI SETHI]

Dear Sh.Vignesh Ji,

So Madam Shilpi Jain is right

. Does transaction qualify all the parameters laid down in the definition of 'Export of Service' under Section 2(6) of IGST Act ? This aspect has to be examined.

[VIGNESH]

Guruji . The Conditions such as-

(i) The supplier of service is located in India

(ii) The recipient of service is located outside India

(iii) The place of supply of service is outside India

(iv) The payment for such service has been received by the supplier of service in convertible foreign exchange or in Indian rupees wherever permitted by the Reserve Bank of India, are satisfied.

But

1. Client has not applied LUT still! will it impact?

2.Should the transaction be reflceted in GSTR-1 and self invoice for same to be generated?

[VIGNESH]

Guruji. Will the above service fall under Import or Export? as the service provider You Tube is not in india?

[KASTURI SETHI]

LUT is not a hurdle if actually service has been exported.

Dear Sh. Vignesh Ji,

Your client has 'received payment' from a person/firm outside India. It is not in dispute. So service has been provided and not received (imported). So it is export of service.

However, it needs to be clarified on what account the amount in foreign currency has been received.

Normally when we give advertisement, we spend money. Here in addition to spending, money has also been earned. The 'possibility' of import of service is also here.

Therefore, correct and concrete and complete reply is possible only after going through the terms and conditions of the agreement or invoices. Sometimes terms and conditions are mentioned in the invoice.

​​​​​​​ Initially I asked for elaboration of the query.

[Padmanathan KV]

I agree with Shilpi Ma'am. I think we have discussed this issue in another post in this forum in detail.

[Ganeshan Kalyani]

It is an export of service. If the recipient is registered under GST then obtain LUT and pay no GST or pay IGST and claim refund.

AI Summary

Export of services: YouTube ad receipts for domestic promoters qualify as export if statutory conditions are met, affecting GST treatment. Receipts from a social media platform for promoting domestic goods constitute export of services if supplier is in India, recipient is outside India, place of supply is outside India, and payment is received in convertible foreign exchange; contractual terms and invoices must be examined. LUT execution does not alter export character; procedural choices include furnishing an LUT to supply without IGST or paying IGST and claiming refund, and the supplies should be reported in GSTR 1 with appropriate invoicing or self billing as warranted.