GST Implications on Print on demand services from US based entity to US based Customers from India
The plan is to start a clothing brand, Z, as follows:
Target market is the US (and Canada + Europe, if additional compliance for such nations is minimal).
The business entity (Elfreds, hereby referred to as E) is an LLP based in India.
E would set up an online ecommerce store (using Shopify, Woocommerce, etc.) and receive orders from US customers. E would receive the payment from the customer under it's brand.
On receiving an order, E would use Print-on-Demand (POD) platforms like Printful, Yoycol, and Subliminator, to print the item in required design and POD platforms will ship the orders directly from their US/EU warehouse to the customer directly. E would pay the POD platform for fulfilment (Wholesale Price + Shipping costs) of the orders. What are various taxes & compliance involved in the transaction and how?
Is this a case of of importation & exportation of service or goods? (Under GST)
1. What taxes will arise when we pay US/UK based POD Platform for their fulfilment of orders?
2. What taxes will arise when we issue invoices to various B2B or B2C parties based out of US/UK for their orders placed with us?
3. What taxes will arise when we get sample apparels for Quality check from POD Platforms in India?
Queries: To identify compliance & taxes involved in the operations:-
What would be the registrations/compliance in India? (Do we need IEC code, if yes, the registration process?)
What would be the tax incidence of the transactions? (Relevant taxes in India and US.)?
(Tax Invoice would be made under the name of Entity E, since Payments for orders are directly captured by E using Payment gateways like Stripe.)
What would be the registration/compliance in the US ? (Registration for Sales tax/Income tax, if yes, process?)
Is local presence required in the US? Does registration of a US based entity make more sense? If yes, the process?
Additional compliance if we explore adding Canada/UK/Europe as target markets?
We place orders on the POD platforms to deliver some items to sample print designs and quality, would there be additional compliances? (Import duty/GST compliance, if yes, the process.)?
If we take B2B orders from businesses (specific design based on their company/brand), would there be additional compliances/registrations/taxes we need to consider?