What is OIDAR and is the Place of Supply for OIDAR

OIDAR stands for Online Information and Database Access or Retrieval services. It refers to the services that are delivered over the internet or an electronic network and are primarily automated with minimal human intervention. OIDAR services include various digital services such as e-books, software downloads, online gaming, streaming services, online advertisements, website hosting, and similar electronically supplied services.

In India, the place of supply for OIDAR services is determined based on the location of the service recipient. The Goods and Services Tax (GST) law in India follows the concept of the destination-based taxation system for OIDAR services.

According to the Indian GST law, if the service recipient is located in India, the place of supply for OIDAR services is considered to be in India, regardless of the location of the service provider. This means that if an Indian customer avails OIDAR services from a foreign service provider, the place of supply is deemed to be in India, and the service provider may be required to register for GST in India and comply with the applicable GST regulations.

It’s important to note that OIDAR services provided to non-taxable persons, such as individuals not registered for GST, are subject to the reverse charge mechanism. Under this mechanism, the service recipient is responsible for paying the applicable GST on the services directly to the Indian tax authorities.
The specific rules and regulations regarding OIDAR services, and their place of supply may be subject to change. Therefore, it’s advisable to consult with a qualified tax professional or refer to the latest updates from the Indian tax authorities for accurate and up-to-date information.

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