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30 Mar 2022

Goods and Service Tax (GST) Laws requires an invoice to be generated for each and every transaction of sale or service even if the value of the transaction is nominal.  A copy of this invoice needs to be made available to the customer.  Given these statutory mandates, let us examine how online Real Money Gaming (RMG) Companies offering games like fantasy sports, rummy and poker websites should issue invoices to its customers

  1. Money deposited by players in their wallet – This is not a transaction of supply and hence invoice is not required to be generated.  A receipt acknowledging the money received can be shared with the players
  2. Player participates in a game and rake is generated for RMG – Invoice needs to be generated at this point in time and a copy of the same should be made available to the player for download  
  3. Relaxation from raising individual invoice – Individual Invoices are not required to be generated for transactions where the rake earned is less than Rs 200 per transaction per player.  A consolidated invoice can be generated at the end of the day for all the transactions where the rake generated was less than Rs 200
  4. Consolidated Invoice – Consolidated Invoice can be raised for all the transactions relating to a Single State.  Effectively, for each State, a separate consolidated invoice will have to be generated. 

However, if a player specifically requests for an individual invoice then the same should be issued to him and such value need not be considered for the purpose of generation of consolidated invoice. To comply with this requirement, a request option can be made available in the player profile with a declaration that individual invoices can be shared only if the request for the same is received within 2 days from the date of the transaction.

The author Mr. Hanish S is a partner at HSKA & Associates, Chartered Accountants.  The firm practices exclusively in the field of Indirect Taxes and GST and provide advisory, litigation and compliance support to their clients.  Views expressed are personal. For more details visit their website www.hskaadvisors.com.

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