OIDAR Services under GST
C A Sanjay Namboothiri

Updated on February 9th, 2024

The growth of online media and online services are phenomenal in the present world. The world has really seen the amazing power and convenient practical usage of online platform during the lockdown specially in sectors like advertisement, media, education and gaming. These sectors have shown double digit growth post the lockdown period including OIDAR service (Online Information Data Access and Retrieval). OIDAR service in GST article broadly speaks on tax applicability and compliance.

We will try to analyse the OIDAR services from GST perspective. 

We will have step by step approach to understand the concept clearly

OIDAR Services Approach

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Relevant sections and Notifications referred to are as below : -

Sec 2(17) of IGST act

Definition of OIDAR services

Sec 14 of IGST Act

Special provisions of tax by supplier of OIDAR service in GST

Sec 2(16) of IGST act

Definition of Non-taxable Online Recipient (NTOR)

Notification no 9/2017 (IT) Dated 28th June 2017

Non inclusion of OIDAR service in GST in the exemption list (proviso to Serial no 10)

Notification no 10/2017 (IT) Dated 28th June 2017

Import of service under RCM (SERIAL NO 1)

Sec 2(11) of IGST act

Conditions for import of service

Sec 24 (11) read with Rule 14

Compulsory registration of person supplying OIDAR services

What is OIDAR Service in GST?

Concept of OIDAR Services under GST

OIDAR full form is given in sec 2(17) of IGST act which is as below :

 “online information and database access or retrieval services” means services whose delivery is mediated by information technology over the internet or an electronic network and the nature of which renders their supply essentially automated and involving minimal human intervention and impossible to ensure in the absence of information technology and includes electronic services such as,

  1. Advertising on the internet;
  2. Providing cloud services;
  3. Provision of e-books, movie, music, software and other intangibles through telecommunication networks or internet;
  4. providing data or information, retrievable or otherwise, to any person in electronic form through a computer network;
  5. Online supplies of digital content (movies, television shows, music and the like);
  6. Digital data storage; and
  7. Online gaming;

Its online service but all online services are not OIDAR services, as there are two most important factors that differentiate between normal online service and OIDAR.

  • The services whose delivery shall be mediated through information technology over the internet / electronic network which makes it automated and
  • The delivery of service to recipient shall be done with minimum human intervention.

Lets try to analyse the concept with the help of some examples

Name of service

Whether done IT/Internet/Digital network are integral part of this service?

Whether there is only minimum human intervention?


Mr. A is conducting Online teaching pan India from his office in Delhi


No – its live online class


Mr A is also supplying the recorded class to students for a price by providing login id and password




An entrance coaching centre is proving recorded classes and downloadable notes after every live class


No because live class is the main service


 The following are some of the popular OIDAR services:


Name of the service provider

Cloud services

Google cloud, Microsoft Azure, Adobe cloud, IBM cloud

Advertisement services

Facebook, Instagram, google search ads

E books

Scribed, kindle, book mate

Search engine

Bing, google search, Yahoo, You tube


Hotstar, Amazon prime, Netflix

OIDAR Service in GST and Its Tax Treatment (Sec 14 IGST)

If we look at the tax treatment given to OIDAR under GST one will understand that the government wants to tax all type of OIDAR usages, that means

  • Services given from India  or from outside India  
  • Services given for business or for non-business.
  • The government( state/central)  and Charitable entities

Every thing is subjected to GST if it’s OIDAR.

It has been also made clear that if the OIDAR service provider is not having an office in India , then they will have to appoint an agent for representing them who will be liable for the tax payment.

 As per sec 14 of IGST act , the OIDAR services provided by a person from non -taxable territory and received by a person being non-taxable online recipient (NTOR) the supplier of service in non -taxable territory shall be liable to pay the tax.

Concept of NTOR in OIDAR Services

NTOR under OIDAR Services under GST

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As per 2 (16) of the IGST act , NTOR means any

  • Government
  • Government authority
  • Local authority
  • An individual
  • Or any other person not registered
  • AND
  • Receiving OIDAR services in relation to any purpose other than commerce ,industry or any business or profession located in taxable territory 

In short if government or an unregistered person uses OIDAR service for personal use, they are known as NTOR

Now, if the OIDAR services from a non -taxable territory are received by an NTOR, the service provider shall be liable to GST (refer sec 14 of IGST Act)

What is the Taxability in case Recipient is not NTOR?

The answer to the above is lying in Notification 10/2017 (IT) dated 28th June 2017.

As per this notification if any service supplied by any person who is located in a non-taxable territory to any person who is not an NTOR located in taxable territory, the transaction is under RCM.

The following transaction is under RCM

Nature of transaction



Any service supplied by any person who is located in a non-taxable territory to any person (Other than NTOR)

Any person located in non taxable territory

Any person in the taxable territory

We can summaries the Sec and Notification as below from the point of view of nature of charge :

Supplier – OIDAR

Recipient (EXCEPT NTOR)


Outside India

In India

In India

Outside India

Forward Charge (This will be termed as export of service only if the conditions under sec 2(6) are satisfied which is covered below )

In India

In India

Forward charge



Out of GST

What will Happen the Recipient is an NTOR?

If the recipient is an NTOR (Non-taxable On-line Recipient) then the charge of GST in first 3 scenarios mentioned above would be Forward charge (As the notification 10/2017 (IT) is not applicable for such cases) and will be outside GST under the 4th scenario.

Now we will check the exemption notification 9/2017 (IT) dated 28th June 2017 to see any of OIDAR service in GST are exempted or not .

If we refer the exemption notification ITR 9/2017, we can see that none of the OIDAR services are exempted, even the government / government authority or charitable trusts are not exempted if they receive OIDAR service . The relevant extracts of the exemption Notification 9/2017 dated 28th June 2017

Services received from a provider of service located in a non- taxable territory by –

(a) the Central Government, State Government, Union territory, a local authority, a governmental authority or an individual in relation to any purpose other than commerce, industry or any other business or profession;

(b) an entity registered under section 12AA of the Income-tax Act, 1961 (43 of 1961) for the purposes of providing charitable activities; or

(c) a person located in a non-taxable territory:

Provided that the exemption shall not apply to –

(i) online information and database access or retrieval services received by persons specified in entry (a) or entry (b); or

(ii) services by way of transportation of goods by a vessel from a place outside India up to the customs station of clearance in India received by persons specified in the entry.

Let’s take some more examples to understand the concept


NTOR or not

Tax treatment

M/s Sooraj associates is an unregistered firm from Delhi and they are using OIDAR service for business


If OIDAR is located outside India, then transaction is under RCM and the firm has to mandatorily take the registration and pay GST. If OIDAR is in India its under forward charge

M/s Sooraj associates is a registered firm from Delhi and they are using OIDAR service for non- business purpose


If OIDAR is located outside India, then transaction is under RCM If OIDAR is in India its under forward charge

A state government is using OIDAR services for other than commerce /business


Forward charge
OIDAR will raise invoice

Mr A un registered NRI living in USA is using OIDAR services and makes payment through Online banking


If OIDAR is from India its under forward charge and If OIDAR is from outside India its not taxable

Now , we will analyse when the OIDAR services will be treated as export / import of service.

Condition for treating any Service as Export / Import of Service sec 2(6) and sec 2(11) of IGST

We know that in the case of services, transaction is said to be export / import if following conditions are satisfied.


Export of service Sec 2(6) IGST

Import of service Sec 2(11) IGST

Condition 1

Supplier should be in India

Supplier should be out of India

Condition 2

Recipient out of India

Recipient in India

Condition 3

Place of supply should be OUT of India

Place of supply should be India

Condition 4

consideration should be in Forex unless for permitted transactions


Condition 5

Supplier & recipient should not be related person


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A transition shall be export of service if 5 conditions mentioned above are satisfied cumulatively. Similarly for import of service , 3 conditions are to be satisfied cumulatively .

Place of Supply of OIDAR Services sec 13(12)

Sec 13(12) of the IGST act defines the Place Of Supply for OIDAR service as location of the recipient (LOR).

For the purposes of this sub-section, person receiving such services shall be deemed to be located in the taxable territory, if any two of the following non contradictory conditions are satisfied, namely:
  • Location of address presented by the recipient through internet is in the taxable territory;
  • The credit card or debit card or store value card or charge card or smart card or any other card by which the recipient settles payment has been issued in the taxable territory;
  • The billing address of the recipient is in the taxable territory;
  • The IP address of the device used by the recipient is in the taxable territory
  • The bank of the recipient in which the account used for payment is maintained is in the taxable territory;
  • The country code of the SIM card used by the recipient is of taxable territory;
  • The location of the fixed land line through which the service is received by the recipient is in the taxable territory

Hence , if OIDAR service is provided from India to customers who are NRIs etc , the transaction shall be closely checked whether the above non contradictory conditions are applicable Or not . If yes , then the location of recipient shall be deemed to be in India and hence cant be treated as export of service.

OIDAR service providers must file their GST return filing by a specific date and with the appropriate form, depending on their place of business.

GST Registration Requirements for OIDAR Service Provider

The GST registration requirements are mentioned in sec 14 of IGST and Sec 24 (xi) of CGST act .

As per sec 24(xi) of CGST , notwithstanding anything contained in sub-section (1) of section 22, the following categories of persons shall be required to be registered under this Act,–:-

(xi) every person supplying online information and database access or retrieval services from a place outside India to a person in India, other than a registered person; and [See Rule 14]

As per Sec 14 (2) of IGST act

The supplier of online information and database access or retrieval services referred to in sub-section (1) shall, for payment of integrated tax, take a single registration under the Simplified Registration Scheme to be notified by the Government:

Provided that any person located in the taxable territory representing such supplier for any purpose in the taxable territory shall get registered and pay integrated tax on behalf of the supplier:

Provided further that if such supplier does not have a physical presence or does not have a representative for any purpose in the taxable territory, he may appoint a person in the taxable territory for the purpose of paying integrated tax and such person shall be liable for payment of such tax.

OIDAR Service in GST : Compliance Aspects

Location of OIDAR service provider

Name of Return

Due date

Outside India and serving an Indian customer ( whether or not through a agent in India)


20th of the subsequent month

In India

11th and 20th of subsequent month respectively


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C A Sanjay Namboothiri

About the author

Qualified Chartered Accountant with over 20 years of  experience.

Has worked in many reputed companies at senior posts which include Muthoot Finance , Joyalukkas and Indel Corporation . Has played pivot role in strategic planning , cost control , Treasury Management, Risk based control and Tax regulatory compliance areas .

Key Strength  :

Hands on experience in the areas of Non – Banking financé , Retail and Govt contracting
Experience in financial analysis, financial management, Budgetary control, MIS and planning
Has expertise in the areas of Fund raising, both equity and debt.
Possess wide range of Experience in Administration and Management.
Strong Organizational and Communication skills.
Well versed in all areas of Banking with special focus in Corporate Finance.
Expertise in Tax advisory specifically with respect to Indirect tax (GST)

Present Engagement

Designated Partner, JSST & CO LLP – A firm of CAs based out of Ernakulam engaged in Audit and advisory services .
Associate of ‘ESQUIRE Consulting’ – A firm of professionals engaged in Fund Raising, Debt Syndication, Insolvency Process, Restructuring, Advisory Services and working as an Associate with the firm.

Professional Achievements :-

MBA With specialization in Finance and strategic management from IIM Kozhikode (Online )
MBA in Strategic management from Bharathiyar University
Has successfully completed the Certificate Course form ICAI on GST by Indirect Tax committee of ICAI
Has successfully completed online GST Practitioner course conducted by the Ministry of Commerce and Industry (MSME) Govt of India
Has written many articles in Tax journals and Professional magazines on GST and Finance management

Other Expertise

Providing training to students and professionals in Taxation/ GST /Accounting / Finance
Liasoning with Banks/FIs/various authorities on behalf of clients.
Preparation of Restructuring and Resolution Plans

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