Goods and Services Tax (GST) is India's value-added tax, implemented in 2017. For foreign companies, GST registration applies in three scenarios — and the foreign company often doesn't realise it has an obligation until receiving a show-cause notice. Get registered up front.
Three GST registration scenarios
| Scenario | Who registers | GST registration type |
|---|---|---|
| Indian subsidiary has operations in India | Indian subsidiary itself | Regular GST registration (state-specific) |
| Foreign provider offers OIDAR services to Indians (B2C) | Foreign provider | OIDAR registration (simplified) |
| Foreign company temporarily operates in India (event, project) | Foreign company | Casual Taxable Person registration |
| Foreign provider sells goods to Indian customers (import) | Indian importer or distributor | Regular GST (importer's registration) |
Indian subsidiary GST registration
- Mandatory if aggregate annual turnover exceeds ₹40 lakh (₹20 lakh for service-only businesses).
- Voluntary for any business below the threshold — recommended for B2B operations to claim input credit.
- State-specific — separate GST registration for each state of operation.
- Application via GST portal — typically 5-10 working days.
- Issued GSTIN is a 15-character identifier including state code, PAN, and check digit.
OIDAR — for foreign B2C platforms
OIDAR (Online Information and Database Access or Retrieval services) registration applies to foreign companies providing digital services to Indian consumers (B2C). Examples: foreign streaming services, foreign SaaS providers selling to Indian individuals, foreign e-learning platforms.
- Applies to B2C only — foreign provider to Indian individual consumer.
- B2B sales to GST-registered Indian businesses use Reverse Charge Mechanism (RCM); buyer pays GST.
- Simplified registration process for OIDAR providers — single nationwide registration.
- 18% IGST charged on invoices to Indian B2C customers.
- Foreign provider remits GST quarterly via the OIDAR portal.
- Major platforms (Google, Meta, AWS B2C, Apple, Netflix) registered under OIDAR for India.
GST registration handled with incorporation
FastLegal's incorporation engagement includes GST registration for the Indian subsidiary — applied during the SPICe+ filing where possible, otherwise filed separately in 3-5 days. For OIDAR registration of a foreign provider, our tax specialist handles the application and ongoing returns.
Reverse Charge Mechanism on imports of services
When an Indian GST-registered business buys services from a foreign supplier, the Indian buyer pays IGST under RCM (Reverse Charge Mechanism). The foreign supplier doesn't charge GST; the Indian buyer self-assesses and remits.
- No threshold — RCM on imports applies from the first rupee.
- Typical rate 18% IGST.
- Self-invoice issued by the Indian buyer at the time of receipt of service.
- IGST paid via GSTR-3B filing.
- Input Tax Credit (ITC) claimable in the same GSTR-3B return — net cash impact zero for a normal tax-paying business.
Documents needed for subsidiary GST registration
- PAN of the company (auto-allotted with CoI).
- Certificate of Incorporation.
- Address proof of principal place of business (rental agreement / NOC + utility bill).
- Bank account details + cancelled cheque.
- Authorised signatory PAN + Aadhaar + photo.
- Board resolution authorising the signatory.
- Digital Signature Certificate of the authorised signatory.
Ongoing GST compliance
- Monthly GSTR-1 (outward supplies) by 11th of next month.
- Monthly GSTR-3B (summary return + payment) by 20th of next month.
- Quarterly QRMP scheme available for businesses under ₹5 crore turnover (file quarterly, pay monthly).
- Annual GSTR-9 by 31 December.
- GSTR-9C reconciliation by 31 December for businesses above ₹5 crore turnover.
- E-invoicing mandatory for businesses above turnover threshold (currently ₹5 crore).
Frequently asked questions
Is GST registration mandatory for an export-focused Indian subsidiary?+
Yes — for service exports, GSTIN is required even though exports are zero-rated. Lets you claim input credit refund.
Can a foreign company register for GST without an Indian subsidiary?+
Only for OIDAR (B2C) or Casual Taxable Person (short-term presence). For ongoing B2B services, the recipient (Indian buyer) handles GST under RCM; foreign provider doesn't need GST.
What's the penalty for late GST registration?+
Late fee of ₹50 per day per return (₹100 if late beyond 60 days), capped at ₹5,000. Plus 18% interest on outstanding tax.
Does GST apply to ESOP perquisite?+
No — ESOP perquisite is salary income, not service supply. No GST. Income tax via TDS at salary slab rate.
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