Do authors have to pay GST?

“While books are largely out of the GST gamut, various input supplies are taxable. The royalties paid to authors or writers are taxed at 12\% and that too under the reverse charge mechanism. The cost of books may go up due to the cascading tax effect on publishers,” said Abhishek A Rastogi, partner, Khaitan & Co.

Do I need GST for KDP?

No. You do not have to register for GST. Kindle ebooks are sold through KDP.

Do authors need to pay tax?

Income earned in India: The author must be a resident of India or resident but not ordinarily resident of India. The content written by an author or a joint author should be work of artistic, scientific or literary nature. The taxpayer must file an income tax return to claim the deduction under this section.

Is there tax on Kindle books in Canada?

Items sold on Amazon.ca and shipped to locations in Canada may be subject to tax. Manitoba: 7\% Retail Sales Tax (“RST”) and 5\% GST. Quebec: 9.975\% Quebec Sales Tax (“QST”) and 5\% GST.

Is GST payable on royalty?

GST at the rate of 18 per cent is imposed on royalty given to the state governments for mining rights. “Royalty paid to the state government for mining rights is a statutory levy and accordingly the question of applicability of GST is subject to judicial review as there is no quid pro quo for the payment,” he said.

Does KDP collect sales tax?

Royalty payments for sales on the U.S. store are subject to 30\% U.S. tax withholding, including payments from the KDP Select Global Fund. Publishers may be eligible for a reduced rate of U.S. tax withholding if their country of permanent residence has an income tax treaty with the United States.

Does royalty attract GST?

Following the recent GST Council meeting, the government has clarified that any royalty or licence fees paid to the state should attract 18\% GST. “The services by the way of grant of mineral exploration and mining rights attracted a GST rate of 18\% with effect from July 1, 2017,” the government clarification said.

Is GST payable on royalties?

A: Based on the facts, GST is payable on both the one-off payment and the previous ongoing royalties. GST is payable when an entity makes a taxable supply.

Is there tax on a Kindle book?

If you are selling your book through Amazon, Amazon takes care of charging your customers sales tax and remitting sales tax to the state. So Amazon charges and collects sales tax in states where digital books are taxable. You don’t have to worry about collecting sales tax on the books you sell!

Do you have to pay GST on book sales?

Abhishek A Rastogi, a partner at Khaitan & Co said on regarding the matter, “While books are largely out of the GST gamut, various input supplies are taxable. The royalties paid to authors or writers are taxed at 12\% and that too under the reverse charge mechanism.

Is GST applicable on author royalties?

On the matter, Ashwin Sanghi said, “The problem lies in the fact that 12\% GST is applicable on author royalties. Publishers must pay GST on the reverse charge mechanism basis, but the problem is that the publisher can’t claim input credit given that books are not covered under GST.”.

Why publishers are not able to compensate royalties against tax liabilities?

According to tax experts, refund mechanism is not available against input taxes if the supply Goods such as books are exempted under GST. The revert of refund scheme profits is limited to only taxable goods mentioned under GST taxable items list. This is the reason why publishers are not able to compensate royalties against tax liabilities.

What is the reverse charge under GST on copyrights?

MS Mani, a partner at Deloitte India said, “The reverse charge applicable on the copyrights of authors under GST requires the publishers to pay the tax, and if these are passed on to the authors, it would amount to an effective reduction in the royalties payable.”