Place of Supply for OIDAR Services under GST (2026): Section 13(12) and the Non-Taxable Online Recipient
CA Meet Dhrangadhariya 
May 5, 2026
CA Meet Dhrangadhariya May 5, 2026
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Last updated: 09 October 2026 · Written and reviewed by CA Meet Dhrangadhariya, CSM & Co LLP
Quick summary
OIDAR services are the one category where GST deliberately flips the usual rule: instead of taxing where the supplier is, or applying reverse charge on the Indian recipient, the law can require an overseas supplier with no presence in India to register and pay Indian GST directly. This post covers what counts as OIDAR, where it is placed for GST, and who ends up paying.
New to terms such as “reverse charge” or “non-taxable territory”? See the technical terms explained in simple words further down.
Under section 2(17) of the IGST Act, 2017, a service is OIDAR only if both conditions hold:
A 2023 amendment, now in force since 1 October 2023, removed the earlier words “essentially automated involving minimal human intervention and” from this definition. A service does not stop being OIDAR just because real human effort sits behind it - what matters is that IT itself is what makes delivery possible at all.
Examples of OIDAR: internet advertising, cloud storage services, e-books/movies/music/software delivered over telecom networks or the internet, retrievable data or information supplied electronically through a computer network, digital content supplies (streaming shows, music), and digital data storage.
A separate, pending amendment would explicitly add “online gaming” (excluding online money gaming, which is separately defined and taxed) as an OIDAR example - this has been enacted but is not yet notified into force.
Not OIDAR: electronically-ordered physical goods, physical books, newspapers and journals, professional advice delivered by email, bookings for events, hotels or car hire, courses with a teacher actually delivering content live over the internet, offline physical repair services, and advertising through traditional media (newspapers, posters, television).
Under section 13(12), the place of supply of OIDAR services is always the location of the recipient, regardless of who the supplier is or where they are based.
The recipient is deemed to be in India’s taxable territory if any two of the following conditions, taken together, are not contradictory:
Where an OIDAR supplier is located outside India and supplies to an unregistered recipient located in India - a “non-taxable online recipient” - the overseas supplier itself is responsible for registering (typically under a simplified registration scheme) and paying IGST directly. The Indian recipient does not pay this under reverse charge in that scenario.
Example: An Indian student subscribes to a US-based streaming service directly. The streaming company, not the student, is responsible for GST registration and payment in India.
If the recipient is instead a registered person in India, the usual reverse charge applies - the Indian registered recipient pays the IGST, not the overseas supplier.
The same 1 October 2023 amendment that changed the OIDAR definition also redefined “non-taxable online recipient”: it now means any unregistered person receiving OIDAR services located in the taxable territory - including a person who is registered solely as a TDS deductor under section 24(vi) of the CGST Act. This broadened who counts as a non-taxable online recipient compared to the earlier, narrower definition.
Where an intermediary located outside India arranges or facilitates an OIDAR supply between the actual service provider and the non-taxable online recipient, the intermediary is deemed to be the recipient of the service (and so becomes liable), unless all of these hold:
OIDAR compliance sits at an unusual intersection of cross-border tax, registration mechanics, and a fact-specific recipient-location test - getting any one wrong can mean an overseas supplier owes Indian GST it never registered for, or an Indian business wrongly pays reverse charge it never owed. Please reach out to our team and we will be happy to assist with OIDAR classification and compliance.
| Term | What it means |
|---|---|
| Non-taxable online recipient | An unregistered person in India receiving OIDAR services - the category that shifts GST liability onto the overseas OIDAR supplier rather than the Indian recipient. |
| Reverse charge | The arrangement where the recipient of a supply, not the supplier, is liable to pay GST directly to the Government. |
| Intermediary | A broker, agent, or similar party who arranges or facilitates a supply between two others, without supplying it on their own account. |
| Taxable territory | The territory where GST law applies - broadly, the whole of India. |
| Simplified registration scheme | A streamlined GST registration process designed for overseas suppliers of OIDAR services who have no other presence in India. |
Online Information and Database Access or Retrieval services - services whose delivery is mediated by information technology over the internet, and whose nature makes them impossible to supply without that technology. Examples include cloud storage, e-books, streaming video or music, online gaming, and internet advertising.
Always the location of the recipient of the service, under section 13(12) of the IGST Act - regardless of where the supplier is based.
The recipient is deemed to be in the taxable territory (India) if any two of seven non-contradictory conditions are satisfied: the address given over the internet, the card or payment instrument’s issuing country, the billing address, the IP address of the device used, the bank account’s country, the SIM card’s country code, or the location of a fixed landline used to receive the service.
The overseas supplier itself, as a “non-taxable online recipient” situation - the supplier must register in India (typically under a simplified scheme) and pay IGST directly, rather than the Indian recipient paying it on reverse charge.
Yes. A 2023 amendment (Finance (No. 8) Act, 2023), now in force since 1 October 2023, removed the words “essentially automated involving minimal human intervention and” from the definition, and redefined “non-taxable online recipient” more broadly. A separate, still-pending amendment would also explicitly add “online gaming” (excluding online money gaming) to the OIDAR examples, but it has not yet been notified into force.
Goods supplied with electronic ordering, physical books and newspapers, professional advice given over email, bookings for events, hotels or car hire, courses with live teacher-delivered content, offline physical repairs, and advertising in traditional media (newspapers, posters, television).
This article is for general informational purposes only and should not be considered professional advice. Please consult a qualified expert for advice tailored to your specific situation. The author and website owner are not liable for any errors or actions based on this content.
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