With the rise of cloud computing and digital transformation, SaaS (Software as a Service) has become a global phenomenon. Many Indian businesses now rely on SaaS solutions offered by international companies or act as aggregators to resell global SaaS services. But what about GST implications?
Understanding the Goods and Services Tax (GST) rules applicable to cross-border SaaS aggregators is crucial — especially with India’s evolving digital tax regulations.
A SaaS aggregator is a platform or intermediary that bundles software services from various SaaS vendors (often foreign) and resells them to businesses or individuals in India. These aggregators:
Simplify billing & access
Localize services
Handle subscription management
Provide value-added support
When cross-border transactions come into play, GST can get tricky but not impossible to manage.
Yes! Under Indian GST law, import of services, including software delivered over the internet, is taxable.
👉 If a SaaS aggregator imports software and resells it to Indian users, it's considered a supply of services under GST.
Section 13(12) of the IGST Act: Place of supply of online information/database access or retrieval services (OIDAR) is the location of the recipient.
Section 2(17): Any person involved in supplying software services (even digitally) is a "taxable person."
If the SaaS aggregator supplies software to another GST-registered business:
The recipient pays IGST under reverse charge mechanism (RCM).
The aggregator may avoid charging GST if the buyer is clearly registered.
If supplied to an unregistered customer:
The foreign SaaS provider or aggregator is liable to pay GST.
They must register in India and charge IGST @ 18%.
If you're a foreign SaaS provider or aggregator supplying to Indian customers, you must:
Register under GST in India
(Mandatory even if your business is abroad)
Appoint a representative in India
(Under Section 24 of the CGST Act)
File monthly GST returns for cross-border B2C supplies
This applies whether you’re selling directly or via an Indian aggregator.
✅ Determine place of supply (India vs abroad)
✅ Collect valid GSTIN from B2B customers
✅ Apply reverse charge where applicable
✅ Charge IGST @ 18% if supplying to Indian end-users
✅ Issue proper tax invoices with SAC codes
✅ File GSTR-1 and GSTR-3B monthly
✅ Reconcile with foreign exchange remittances
Many SaaS aggregators operate like digital marketplaces — onboarding multiple vendors (including foreign ones) and offering their services to Indian users. In such a case:
You may be considered an Electronic Commerce Operator (ECO) under GST
You could be liable to collect and remit TCS @ 1%, and may have GST liability on behalf of vendors
A careful evaluation is needed under Section 9(5) of CGST Act if you are enabling services digitally.
Indian SaaS aggregators can claim Input Tax Credit for:
IGST paid on imported services (under RCM)
GST paid on business expenses like marketing, server hosting, or payment gateway charges
However, ITC can only be availed if you’re a registered taxable person and maintain accurate invoices.
🚫 Ignoring RCM applicability
🚫 Not collecting GSTIN from B2B customers
🚫 Treating cross-border services as exempt
🚫 Missing out on GST registration despite crossing the threshold
🚫 Invoicing errors on foreign software sales
As a cross-border SaaS aggregator in India, it’s your duty to stay GST-compliant. The Indian government is tightening digital taxation — and non-compliance can lead to penalties, loss of ITC, and scrutiny.
Whether you're reselling Zoom, Canva, Google Workspace, or a global CRM – be prepared with correct GST treatment, proper documentation, and timely filings.
📝 Tip: Consult with a professional GST advisor who understands the tech domain!