GST on brand endorsements: do you need to register?

Is an endorsement a supply under GST?

When you agree to promote a brand, appear in an advertisement, post sponsored content or attend an event for a fee, you are generally providing a service. Under GST, a supply of services made for consideration in the course of business can be taxable, so the question is not whether GST can apply but whether you are required to register and charge it.

The turnover threshold

A person supplying only services is generally required to register once aggregate turnover in a financial year crosses ₹20 lakh. For certain special category states the limit is ₹10 lakh. Aggregate turnover is calculated on an all-India basis for a single PAN and can include taxable supplies, exempt supplies and exports. It is therefore worth tracking your total receipts from all sources of services, not just one brand.

Once the limit is crossed, registration is generally to be obtained within 30 days. Some situations require registration even below the threshold, so it is sensible to check your specific facts rather than rely on the limit alone.

Voluntary registration

You may choose to register even if your turnover is below the threshold. Some creators do this so that they can issue tax invoices to brands that prefer them, claim credit for GST paid on business costs or work with Letters of Undertaking for export income. Registration brings return filing obligations, so it is a decision with costs as well as benefits.

What GST is charged on

Once registered, GST is charged on the value of your services. Endorsement and similar services are generally taxed at the standard rate applicable to such professional and business services, and the rate should be confirmed for your supply at the time of invoicing. Tax is shown on a tax invoice, and returns are filed periodically.

Gifts, free products and barter

GST applies to supplies made for consideration, and consideration need not be money. Where you promote a brand in exchange for goods, a trip or other benefits, the value of what you receive can form part of the value of your supply. Free products received without any obligation to promote may be treated differently. The terms of each arrangement matter, so keep the written brief or contract.

Clients outside India

A service to a recipient outside India, paid for in convertible foreign exchange, can be treated as an export of services and zero-rated if all conditions in the law are met. Zero-rated is not the same as exempt: it generally allows supply without payment of IGST under a Letter of Undertaking, or with payment and a refund. Our guide on foreign brand deals explains the basics.

Practical steps

• Add up your service receipts across the financial year and watch the threshold
• Keep contracts that show what you agreed to provide and what you receive
• Note the location of each client, and whether the client is a business or an individual
• Review whether any engagement already needs registration

If you are unsure whether registration applies to you, a short confidential discussion can help clarify the position before filing deadlines arise.