PayPal will now attract 18% GST

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6pack

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Policy update

Effective date: The date your account is moved to PayPal Payments Private Limited from PayPal Pte Ltd which will be no earlier than 2nd October 2017



PayPal is a global leader in digital payments available across 200 markets. Innovation is a core value for PayPal which helps us create amazing experiences for our customers. India is an important market and in order to enable us to provide superior customer experiences, we are updating the UA for PayPal India account holders.

This entails three critical elements-

After the new UA is made effective, you will contract with PayPal Payments Private Limited, a company incorporated in India with CIN U74990MH2009PTC194653.
We have updated our UA to comply with local laws applicable to Indian companies including local taxation laws. We have been advised PayPal Services will attract a GST rate of 18%. Please consult your tax advisors in terms of your eligibility for refunds.
We look forward to increase the scope of PayPal Services in the future subject to regulatory approvals and enter into partnerships.
The actual effective date of the UA change will be notified later after 30 days of the days of notice. As our valuable customer, we hope to continue doing business with you. However for any reason you wish to discontinue doing business with us you have the option of closing your account within 30 days of the date of the notice.
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From what I know of how taxes are applied, they can only charge taxes on the service component which is just what PayPal fees is.
So if PayPal fees was 4%, then effectively it has now increased to 4.72%.
If you are receiving Payment via PayPal as a freelancer then you already need to have a GST no if your revenue is more than 10L. So basically you were supposed to charge service tax which they might be doing now on your behalf (not clear on that as link isn't working)
 
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So, the issue at hand seems to be different than what I had anticipated.
As all foreign transactions are deemed as exports, all payments received via PayPal are exports which are exempt from GST.
However to claim that exemption one needs to generate FIRCs which is turning to be painful for both the user and the banks.
Link to the petition as well as more detailed description of the issue at hand -

https://www.change.org/p/finance-mi...eriences.fake_control&utm_content=ex3:control
 
mutant said:
So, if I am a business making receiving USD on PayPal, how does it affect me?
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You will have to get the bank to issue FIRC for every transaction to claim GST exemption or pay 18% GST on those transactions, just like people who export stuff do.
Go through the link I posted above, it has everything in detail.
 
meetdilip said:
What is FIRC ?
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Foreign Inward Remittance Certificate.
PayPal uses Citibank in India to transfer the money to your bank, so you'll have to request Citibank through your bank to provide a FIRC for every transaction.

Just go through the link I have provided in my second post. It has all the details.
 
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rdst_1 said:
So, the issue at hand seems to be different than what I had anticipated.
As all foreign transactions are deemed as exports, all payments received via PayPal are exports which are exempt from GST.
However to claim that exemption one needs to generate FIRCs which is turning to be painful for both the user and the banks.
Link to the petition as well as more detailed description of the issue at hand -

https://www.change.org/p/finance-mi...eriences.fake_control&utm_content=ex3:control
Click to expand...

So much complication in GST. So if I were to start freelance graphics design business and get money through paypal (like once a week) and my income is less than 10 lakh, I still have to register for GST? I don't have a business and will work from home. So that means I'll have to register a business name, register for GST and only then start accepting orders and payments? and to top it getting FIRC is costlier than the amount i would make. Why does the RBI or govt think i would do this when I'll be in perpetual loss. What happens if paypal deducts GST on their service charge but i don't file any returns? will the IT dept know?[DOUBLEPOST=1504678253][/DOUBLEPOST]
meetdilip said:
What is FIRC ?
Click to expand...
http://www.remittance.in/remittances-foreign-inward-remittance-certificate.html

Edit: cryptocurrency like OmiseGo and XRP look like better alternatives. Concept of buying and transferring cryptocurrency is complicated though.
 
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^ You dont have to register till your revenue from business crosses 20L/year

Even if it crosses, you dont have to register a business name. You can do it as an individual.
 
PayPal reduces remittance certificate charges by 50% for small sellers

Global digital payments platform PayPal has reduced the fee for the Foreign Inward Remittance Certificate (FIRC) to Rs 100 from Rs 200 for up to 20 transactions, the company said in a statement.

For more than 20 transactions a bulk payment of Rs 2000 is charged. PayPal believes it will help in their move to encourage small sellers to sell goods and services globally and use PayPal as their payments platform.

"The reduction in the FIRC fee is in line with our commitment of becoming a customer champion and enabling merchants to grow their cross-border business in a profitable manner," said Narsi Subramanian, Director, Small Sellers & Consumers, PayPal India
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Hi guys,
Thank God !I landed up to this page .I just got a same mail .The buyer tried to buy my listing but couldn't pay the money ,got a message "oh dear .The shop you are trying to order from cannot accept paypal payments"
You can contact to let them know you can't place an order until they resolve an issue with their paypal account .
please advice what need to be done
thanks
 
I am little confused, need clarification for following.

I order toys from amazon.com for around 100 to 200 $ a year and mostly prefer paypal.
How much I have to pay now ?

I make payment for my domains and planning to start a wordpress site, it will cost 50$ annually, how much I have to pay now
payment will done via paypal.
 
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