GST on OTT Platforms and Digital Media Services

GST on OTT (Over-The-Top) platforms and digital media services applies at 18% on subscription and content charges. This covers video streaming services (Netflix, Amazon Prime, Disney+ Hotstar, SonyLIV, Zee5), audio streaming (Spotify, JioSaavn), gaming platforms, e-learning platforms and other electronic/digital services. Here is the complete guide.

GST Rate on OTT and Digital Services

• All subscription-based digital/electronic services: 18% GST (9% CGST + 9% SGST for intra-state; 18% IGST for inter-state)
• Includes: Video streaming, audio streaming, online gaming (non-real money), e-learning subscriptions, cloud software (SaaS)
• No GST on free tier (no consideration) — GST applies only when there is a paid subscription

Place of Supply — Digital Services (Section 12(11) IGST Act)

• For B2C supply of online information and database access retrieval (OIDAR) services: Place of supply is the location of the recipient
• OTT platform based in Maharashtra charging a customer in Kerala: IGST applies (inter-state), collected by the platform
• Both supplier and recipient in same state: CGST + SGST applies

Foreign OTT Platforms — OIDAR

• Netflix, Spotify, Adobe, Microsoft — provide services from outside India to B2C customers in India
• These are OIDAR (Online Information and Database Access or Retrieval) services under GST
• Foreign providers must register in India (under Section 14 IGST Act — simplified registration for foreign OIDAR) and pay IGST on Indian subscriber revenues
• No Aadhaar/PAN required — they register through a simplified portal
• B2B OIDAR: Indian registered businesses receiving foreign digital services must pay GST under RCM (Reverse Charge)

GST Input Tax Credit on OTT for Businesses

• Businesses subscribing to Netflix/Amazon for business purposes: ITC generally available if GST invoice is obtained (GSTIN linked subscription)
• OTT subscriptions for employee entertainment or personal use: ITC blocked under Section 17(5)
• E-learning or cloud SaaS for business: ITC fully available

Online Gaming — Special Note

• Real-money online games (rummy, fantasy sports): GST at 28% on full contest entry fee (effective October 1, 2023 — major change)
• Non-real money skill/casual games: 18% on platform subscription fee

Conclusion

GST on OTT and digital media services at 18% is well-settled — with OIDAR provisions covering foreign platforms and RCM applying to B2B transactions. SPOTON provides GST advisory for digital businesses, content creators, streaming platforms and businesses subscribing to foreign digital services in Kerala. Contact us for expert GST compliance services.