Rito Entrepreneur, YouTuber, Digital Marketer. Founder of Flying Start Online. Dream big, make it happen, and just do what needs to be done!

Goods & Service Tax For Indian Dropshipping Businesses (Bizathon5 Episode20)

2 min read

GST For Indian Dropshipping Businesses

Today we’ll be covering GST for Indian Shopify Dropshipping Stores.

GST refers to the Goods and Services Tax Indians are subject to.

If you’re not from India, this post really doesn’t pertain to you.

Because we have a global audience, with a good portion located within the borders of India, we’ve been asked about GST quite often.

Enjoy the video below as Rito covers GST for Indian Dropshipping Businesses:

India does not make it easy for its people to conduct legitimate business.

In fact India ranks 100 out of 195 countries in the world when it comes to ease of conducting business.

That is not good, and the people in power should be ashamed.

There are so many things the Indian government could do to enhance commerce.

Unfortunately for entrepreneur minded Indians trying to get ahead…

You not only have to deal with much red tape, you’ve got to navigate corruption on top of other nonsense.

On top of all this, you also have to worry about a Goods & Service Tax.

How Do I Get A GST Number?

In order to obtain a GST number, you need a business.

Your business can be in the form of a sole proprietorship or OPC (One Person Company) or both. 

We recommend utilizing Sole Proprietorship, since it’s the easiest way to get you going.

After you’re established and know what it takes to run a successful business, you can then think about incorporating.

Once you’ve established your sole proprietorship, you’ll need to open a bank account prior to applying for your GST number.

Check out this GST guide from Amazon that walks you through the process.

Get Help Forming My Sole Proprietorship

There are several companies that will help you form a sole proprietorship.

Likewise, there are several companies that will help you acquire your GST number.

To get help with company formation, trademark filing, or registering a GST…

Use any of the following websites:

We are not affiliated in any way with the companies I just mentioned.

We’ve just seen many positive reviews for each, and feel they have the potential to be a viable resource for you.

You Can’t Run FB Ads Without A GST Number

Without a GST number, you cannot run Facebook ads.

Actually, you won’t be able to receive payment via PayPal either. 

Just about every other service needed to run a successful business from India, requires you to have a GST number. 

Do I Really Need To File For GST Number?

If you don’t advertise your website and products in India, and you don’t have any customers within the borders of India, you technically don’t need to pay GST.

You only need a GST number when you are selling to people within the actual country of India.

However, that being said, it’s likely the most e-Commerce platforms and associated services will all soon require GST numbers from Indian residents, regardless of your customer base.

For instance, we don’t advertise any of our products or services to India.

That means Rito is not liable to pay any GST for his businesses.

Paying GST Is Different Than Filing A GST

It’s important to understand that paying your GST and filing your GST are different.

You don’t have to pay GST if you’re not selling your products to Indians.

However, it is still required to file GST is you’re an India resident doing business.

In order to file a GST we recommend speaking with a local chartered accountant.

It will only take a few minute phone call.

The accountant will automatically file your GST when the time comes for a nominal fee.

That’ll do it for Episode 20 – Great work!

Questions, comments or just want to say hi?

We love hearing from you in the comments below!

Success by choice, not by chance,

-David Aston

P.S.

If you’re not kept in the loop via our #Bizathon definitely sign up today.

P.P.S. Click here for Episode 21!

Rito Entrepreneur, YouTuber, Digital Marketer. Founder of Flying Start Online. Dream big, make it happen, and just do what needs to be done!

68 Replies to “Goods & Service Tax For Indian Dropshipping Businesses (Bizathon5…”

  1. Can I use MSME udyogaadhaar by goverment of india to register sole proprietorship. Can you plz let me know rito

  2. Thank You for such a great info. Will there be any taxes which we are obliged to pay to The Govt. Of India ? If so , which ones ?

  3. DEAR RITO,
    MY CA TOLD ME TO PAY GST@18% RATE FOR MY DROPSHIPPING BUSINESS,I DIDNOT ADVERTISE IN INDIA AND NEVER MAKE ANY KIND OF MARKETING IN INDIA,PLEASE HELP ME IN THIS MATTER.
    THANKS

  4. hi thanks for the video on GST. Now, as you said we don’t need GST to sell for customers outside india, then can we also run FB ads w/o GST number? Please explain.
    Thank you !!

  5. Hello Sir.
    I have consulted 2-3 CA and read lots of QA on taxfull(dot)com, I found that regarding GST on drop shipping, all the professionals(CA) are divided.
    1. One is saying you dont need GSTIN
    2. Two is saying GSTIN is required but no need to pay GST
    3. Three is saying You are required pay GST on full sale amount
    4. Four is saying You are required to pay 18% on profit earned etc,
    As I am considering the fourth option is more reliable than other. Fourth say that register yourself as Intermediary and pay 18% GST on profit earned. Please suggest further.

  6. Hi Rito,
    I currently don’t have a GST number. Will I be able to receive payments through paypal if I am not advertising in India? You mentioned I can’t receive payments on paypal without a GST number. Does this exclude those who are only selling and advertising in the US? Also, paypal is notifying me to enter my GST N number, I am not sure if this is a requirement or not.

  7. is ecommerce shopify dropshipper( Non Indian supplier to non Indian consumer) a tax payer or a tax deductor or a tax collector.
    This is the first question asked while registering for GST ?
    Please help bro.
    Thanks in advance

    1. hi u got your answer ? i am also going to start my dropshipping business and i am applying for gst registration and in that process i got stuck in one page HSN code and Service help me out bro what to fill for dropshippers?

  8. Hi,
    Nice article thanks,

    Sorry for my english. 🙁
    But i have question as i will purchase product from one country and sell to another country. So am i liable to pay tax from the profit and if yes is it from my personal income or from my company name.
    Thanks

  9. One has to pay 18% on goods sold.
    Paying GST is mandatory since it is export of services/ goods.

  10. Hey Rito, I have a doubt if you can clear. My CA says that, regardless of the fact that I dont need to pay GST, I need to file it and for that I need to furnish every detail of my customer from his name to invoice no.,address, sale amount, purchase amount & product etc. on the GST portal and then file it as ‘NULL’ or ‘NIL’.

    Is it correct? Because gathering so much information in one file is such a tough task ? Please reply as I cant get a solution to this. Even the CAs in my city are new to the e commerce. Help please!!

  11. Hi,

    Thanks for your article. Just wanted some clarification.
    I am a resident of India and looking to start my dropshipping business.
    My questions are:
    1) How do you do the invoicing? Is it that the Ali Express vendor raises an invoice in your name let’s say for $100 and you raise an invoice to the buyer in USA let’s say for $120?
    2)If that is the case then that means goods were sold to an Indian and that Indian exported those goods. This while I was reading I figured comes into the compliance of High Seas.
    If so have you looked into any Import Export aspect of this?
    I am very confused with all this and really appreciate your help on this.

  12. there is requirement in gst registration

    1. E-Commerce operator
    2. Selling through E-Commerce Portal

    which one to select?

  13. Hi, I am from India and I am planning to start drop shipping business to outside of India. Is there any way to start the “small business/not yet established” without registering all of these. Do I need to register a “Pvt Ltd” for starting the business? How much does it cost to start the business. Kindly let me know.

  14. Hey,
    Question
    What if I am operating from India but selling in USA- (not that simple).. So I have an Shopify account and sell goods in USA, I do not hold any physical inventory for any products in USA or India. I am a deal hunter- will find deals and post the product on shopify, if someone buys il just ship the product from whoever has the best deal. I recieve money in USD to paypal which converts to INR.

    How would that senario work for GST purposes- Filing or getting a GST number- I am not selling in India so I wont be paying the GST for sure.

    Thanks in Advance

      1. Please create a video on Taxes. I’m paying penalty from past three months as my CA is not able to understand what Taxes to chargeand what not
        .

  15. Hey Rito,

    Great content. One question. I have a dropship business set up in USA on my relatives name. I transfer money here as it grows there. How do I show this expense. And I use my card here to make AE purchases. Really confused about how this whole thing fits in an equation. Can you please help. My whatsapp is 8805027937 . Please feel free to drop a text . Big Fan

  16. Hey Rito ,

    mene apne ca se baat ki or unhone bola ki mere ko mere monthly net profit pr 18% gst return file krna pdega..

    muje yeh glt lg raha hai ki nah to mei india mei sale ja purchase kr raha hu or nahi india mei advertisement kr raha hu to 18% kaise lgega??

    Kyaa aap plz meri is confusion ko door krdenge sir.

    best regards,
    Pushpinder Singh

  17. I want to dropship in amazon however there is gst is must so if i sell them and i dont have any bill slip se how will i file in amazon

  18. Hi

    I have a question regarding taxation on Drop shipping business, I want to do drop shipping via aliexpress/alidropship, Here is scenario:-

    1. I live in India but i want to sell to US citizen,, so Am i eligible to pay Vat to India/US ??

    2. 1. I live in India but i want to sell to Europen citizen,, so Am i eligible to pay Vat to India/European country ??

    3.1. I live in India but i want to sell to Brazil. Argentina and other LATIN country,, so Am i eligible to pay Vat to India/LATIN Countries ??

    Looking for problem solving a detail answer on this.

    Thank you very much in Advance

  19. Rito one question I almost complete my business account PayPal but in bank link, I connected my bank account but also I show yellow colour exclamatory mark what i meant by that i need your help, please….

  20. Hello,

    Your video is perfect and cleared many my questions, Althou i have x questions
    basic info : I am planning to do a drop-shopping business with a partner , so the gst company and bank accounts will be under partnership firm & as you mentioned the items it is same for me , my ads and products will be sold to USA or other countries customers ( all non-indian ) , so i just need to fill NIL returns , but what about the profits in my bank account ( which will be sent to partners individual accounts after expenses ) will there be any tax for IT ? If yes, how much ?

    1. The standard income tax rules apply on your profits. Make sure you consult a certified CA in your area

  21. Hi rito..
    Thanks for the amazing englightment with every video u bring.. Thank you n god bless.. Can u suggest any good C. A for registering Gst for dropshipping bhaijaan as most of the C. A not understanding this model.. As we will not be liable for paying any Gst as we are just operator n buying from China n selling on Usa via aliexpress…kindly help.. My no 9989469283
    Regards n thanks n keep up the good work.. God bless.

  22. Does I need to pay GST for affiliate marketing and Google AdSense websites? Do I need to pay GST for Clickbank earnings? Sir please reply.

  23. Hi Rito,
    I have a confusion, i haven’t registered myself for income tax return. As i have just started my turnover is very nominal.
    Do I have to file itr? Or is it based on the turnover beyond some amount?

    1. If you’re serious about this business, its recommended to register the company, get a PAN card and file taxes.

  24. I have obtained a GST number recently going to start the operations very soon. But I was told by a CA that I should charge GST for people outside the borders of India in a Reverse Charge mechanism. I am not understanding the point here that why should I charge tax who is not in the tax regime.

    And do I need to take a reseller’s certificate before selling to different locations around the world?
    For example, I am selling products to people from NC, USA then I need to take the reseller’s certificate of NC in order to have dealings from the suppliers I am having in the U.S. I am very much confused now.

    1. can you please help me out how to get gst number i stuck in goods and service page dont know what to fill in HSN code?

  25. Hello Sir..

    Is there any difference between GST and GSTIN. Which one is for shopify store (Not selling in India)
    Thanks,
    Naveen

  26. Rito i want to know which forms do I need to fill to file my gst,
    I don’t understand if I need to pay IGST or what ?

    I have dropped a comment on youtube too but no reply.

  27. Hello Buddy,

    What if we dropship to India. Do we need to charge GST, I have a US stripe and i do not charge any tax and i don’t have to, but i am now thinking for using Indian payment methods like payumoney kn this case do i need to charge gst if i dropship from Aliexpress.

    Best Regards,
    Amir K

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