GST REGISTRATION:

A Digital Marketing Services provider shall be required compulsorily to get registered under GST if; The aggregate turnover of taxable supply of services in a financial year exceeds Rs. 20 Lac [Rs. 10 Lac for North-Eastern states i.e. Pondicherry, Meghalaya, Mizoram, Tripura, Manipur, Sikkim, Nagaland, Arunachal Pradesh, Uttarakhand.]

RATE OF GST:

Digital Marketing Services provider shall have to charge 18% GST on all taxable supply of services.

INPUT TAX CREDIT:

The suppliers of Digital Marketing Services are eligible to avail Input GST Credit. For taking credit GST registration is mandatory.

COMPOSITION SCHEME:

As per Notification No. 02/2019, the suppliers of Digital Marketing Services can avail composition scheme at a flat rate of 6% [3% CGST & 3% SGST] in case they have an annual turnover of less than Rs. 50 Lac in the immediately preceding financial year. [ In computing aggregate turnover in order to determine eligibility of a registered person to pay central tax at the rate of 3% under this notification, value of supply of exempt services by way of extending loans, deposits or advances in so far as a consideration represented by way of interest or discount shall not be taken into account.] This low-compliance scheme is bound to bring joy to many digital marketing companies with advantages like;

 

1] File returns just once a year.

2] Pay GST quarterly.

3] Pay at a flat rate.

 

It is important to note that the suppliers of Digital Marketing Services cannot claim Input Tax Credit if they opt for Composition Scheme. Hence they will have to pay the tax from their own pocket.

SAC [Services Accounting Code]:

These codes are used to classify the services under GST regime in India. Each service has a unique SAC. SAC code for digital marketing service is 9988.