Indian Paypal Users - Paypal is going to charge 18% GST from October

As we expected the shocking news has been arrived finally : - Paypal is going to charge 18% GST on paypal services in India effective from October - 2017 .You can check the complete details from this paypal page --> https://www.paypal.com/in/webapps/mpp/ua/upcoming-policies-full

So freelancers from India and GST experts , Please come together , share your ideas and solutions to manage this situation and how we can get the refund later once paypal deducts GST from your payments received from overseas.Kindly share your thoughts in reply .

 

Yes, it is something has to be sorted out. I guess, here we will not get any GST expert advice, as there may not be any Tax Advisers in this forum. More over, I have seen (in my past experiences), that even CA forums or websites are not giving any proper answers to tax related queries of online freelancers. Either they are not sure about our scenarios or they need to be payed to get their service. Mostly we are the only people who give expert advice for free...

 

Yes , it seems very true . But if anyone went through the same scenario and sharing their experience will be much helpful in this situation. Thank you..

 

Yes it is effective from 2nd October, 2017. If you don't want this to happen, sign this petition on change https://www.change.org/p/finance-mi...e-paypal-payoneer-rules-regulations-for-india

 

Seems a good move , Posted the petition, let's come together and present it infront of the ministry . Hope it will make a positive impact

 

I have already signed the petition. Let's unite together and remove this thing.

 

Atleast we are letting government know about this thing.

 

This page informs users in advance of important changes to the PayPal Service, its User Agreement, or other policies. We encourage you to review this Policy Update to familiarize yourself with all of the changes that are being made to the PayPal User Agreement. These updates will be posted at least 30 days prior to their effective date.

Effective date: 2 October 2017 for Users who contract with PayPal Payments Private Limited

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
latter 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 closing your account within 30 days of the date of the notice.

Request a FIRC for every money transfer.
Every transfer of funds from your PayPal account to your bank account will require a separate FIRC. Contact the bank where your PayPal withdrawals are credited to request a FIRC and a letter addressed to Citibank with the following information:

• Unique Transaction Reference number (UTR)
• Customer name
• Account number
• Amount of money
• Date and purpose of the payment

We recommend that the letter also mention that the payment was received from PayPal. You can refer to a sample request letter here. Please also inform your bank of the postal address you want the certificate(s) to be delivered to.


Questions and Answers

What is a Unique Transaction Reference number and how can I find it?
The UTR number can be found on your bank statement beside each payment from PayPal. In the example below the reference number for the deposit from the sample PayPal credit of INR 151.49 is CITIN12198884488
Figure: Sample image of PayPal credit with n-EFT reference number (UTR number) in bank statement

Is there a fee for the FIRC certificates?
There is a fee of INR 200.00 + 18% GST per FIRC certificate charged by Citibank (i.e. per transfer from PayPal to your bank). For merchants with a Citibank account, this fee will be automatically deducted from the bank account. Merchants without a Citibank account will be required to submit a Demand Draft of the fee amount in favour of ‘CITIBANK INDIA NA FIRC CHARGES’, payable at Mumbai together with the FIRC request letter.
Note: GST rate can change from time to time. Please check applicable tax rate at time of creation of Demand Draft.

Who pays this fee?
You (the merchant) will need to pay the fee.
How long does it take?

• The time taken to process the FIRC by Citibank is given below:
• Citi account holders: 3 working days
• Non-Citi account holders: 7 working days

Please note that the duration mentioned is the processing period and does not include the time taken to ship the documents from your bank to Citibank and back.

Who contacts Citibank with the request for the FIRC and fee?
Your bank contacts the nearest Citibank corporate branch. Citibank will then issue the FIRC certificate(s) and courier them to the address you provided. You can find the list of Citibank corporate branch locations here.


SO WE SHOULD STARTING FINDING ANOTHER OPTION FOR PAYMENT INSTEAD OF PAYPAL PAYMENT

 

The government may not be aware about the exact situation. Using that petition, it will be possible. If you remember, in past PayPal terms have been changed few times in India.

 

If that happen most of people will stop using Paypal. 18% GST will be too high for us for every paypal transaction...After GST not much people can offer cheap services..

 

I already have signed up the petition. Indian Government really screwing the freelancers and bloggers in India.

 

Yeah...It will ruin all Freelancers and many others.

 

I signed it too but Does it really work? Are you sure will it reach to Prime Minister ?

 

This statement is puzzling. From paypal website

How does this "refunds" thingy work? Does it mean we need to compulsorily register for GST, file return & claim refund?

 

Not Only this, I think our govt, just want to TAX TAX TAX, Starting from
1) We need to pay paypal will charge 4.5%
2) We need to pay paypal will charge GST 18 %
3) We need to pay income tax to our govt,
4) We need to pay GST every where starting from TOUR, HOTEL, Intertainment, ETC ETC

So our Indian govt want GST how many times,

MAIN part is We need to GST from our SALARY ( Income) Why should not GOVT Employee or Private Company NOT pay GST according to GST, they are also providing services to our govt, they are also income from their services or job

Every where we go GST GST, Govt said one tax but they are taking to TAX, central GST and State GST,

Whats going on with finance minister, I don't know what he thinks