GST for Influencers: Tax on Brand Deals

Influencers in India are required to pay Goods and Services Tax (GST) on the income earned from brand deals, sponsorships, and other forms of compensation. The GST rate applicable to influencers is 18%, and registration is mandatory if the annual turnover exceeds Rs 40 lakhs. This includes income from barter deals, PR gifts, and other forms of non-monetary compensation.

What is Considered as Supply for GST Purposes?

For GST purposes, any supply of goods or services by an influencer to a brand is considered taxable. This includes sponsored posts, product reviews, and other forms of promotional content. The supply is considered to be made in the course of furtherance of business, and the influencer is required to charge GST on the income earned.

Service	GST Rate	Registration Threshold
Sponsored posts	18%	Rs 40 lakhs
Product reviews	18%	Rs 40 lakhs
Barter deals	18%	Rs 40 lakhs

How to Calculate GST on Brand Deals?

The GST on brand deals is calculated based on the income earned by the influencer. The influencer is required to charge GST on the invoice raised to the brand, and the brand is required to pay the GST amount to the government. The influencer can claim input tax credit (ITC) on the GST paid on the goods and services used for providing the services to the brand.

• Calculate the income earned from the brand deal
• Charge GST on the income earned at the rate of 18%
• Pay the GST amount to the government
• Claim ITC on the GST paid on goods and services used

TDS by Brands on Payments to Influencers

Brands are required to deduct tax at source (TDS) on payments made to influencers. The TDS rate applicable is 10% of the payment made, and the brand is required to deposit the TDS amount to the government. The influencer can claim credit for the TDS amount deducted while filing the income tax return.

The most important thing for influencers to remember is to maintain proper records of the income earned from brand deals and to charge GST on the income earned. This will help in avoiding any disputes with the tax authorities and ensure compliance with the GST laws.

Frequently Asked Questions

What is the GST rate applicable to influencers?

The GST rate applicable to influencers is 18%. However, verify the current figure as GST rates are subject to change.

Is registration mandatory for influencers?

Yes, registration is mandatory for influencers if the annual turnover exceeds Rs 40 lakhs. However, verify the current figure as registration thresholds are subject to change.

Can influencers claim ITC on GST paid on goods and services used?

Yes, influencers can claim ITC on the GST paid on goods and services used for providing services to the brand.

The bottom line

Influencers in India are required to pay GST on the income earned from brand deals, sponsorships, and other forms of compensation. The GST rate applicable is 18%, and registration is mandatory if the annual turnover exceeds Rs 40 lakhs. Influencers must maintain proper records and charge GST on the income earned to avoid any disputes with the tax authorities and ensure compliance with the GST laws.