GST on web hosting in India, explained

The rate

Web hosting is taxed at 18% GST in India. So are VPS instances, dedicated servers, cloud hosting, domain registration, SSL certificates and control-panel licences. They are classified as IT and hosting services under SAC heading 9983 (hosting itself is 998315). The OIDAR label matters mainly when you buy from a foreign provider. There is no lower slab and no exemption for small websites.

A plan advertised at ₹879/mo therefore costs ₹1,037/mo on the invoice. Honest hosts say "excluding GST" next to the price; less honest ones let you discover it at checkout.

Getting the 18% back

If you are GST-registered and the hosting is for business use, that 18% is input tax credit — it offsets the GST you collect from your own customers. In practice the hosting costs you the base price and the tax washes out.

Three conditions have to hold:

1. You hold a valid tax invoice with your GSTIN printed on it.
2. The service was actually received — not merely paid for in advance.
3. The supplier reported it in their GSTR-1, so it appears in your GSTR-2B.

That third one is where claims fail. If your host does not file, the credit never shows up and your accountant cannot claim it; if it files late, your claim is held up until it does (and is lost if that slips past the annual deadline). It is worth asking before you buy.

What a valid tax invoice has to show

• Supplier's name, address and GSTIN
• Your name, address and GSTIN
• A sequential invoice number and the date
• A description of the service
• The taxable value
• CGST and SGST separately if supplier and customer are in the same state, or IGST if they are in different states
• The place of supply

A PayPal receipt is not a tax invoice. Neither is a credit-card statement. If what arrives after payment has no GSTIN on it, you cannot claim anything against it.

CGST + SGST, or IGST?

It depends on where the supplier and the customer are:

• Supplier and customer in the same state: 9% CGST + 9% SGST.
• Supplier and customer in different states: 18% IGST.

The total is identical and the credit is identical. Only the split on the invoice changes.

Buying from a foreign host

This is where it gets tedious.

If you are GST-registered, importing a service triggers the reverse charge mechanism: you pay the 18% directly to the government yourself, report it, and then claim it back as input credit. Net cost is the same, but you are doing the supplier's paperwork.

If you are not GST-registered, the foreign supplier is supposed to register in India under the OIDAR rules and charge you GST. Many of the large ones do. Some do not, which leaves an obligation sitting somewhere uncomfortable.

Add the forex markup your card issuer charges — usually 2–3.5% — and the "cheaper" foreign host is frequently not cheaper at all.

A worked comparison

Rates are illustrative. The point is the direction, not the decimal: the foreign sticker can still win on price, but local billing is always simpler.

If you are not GST-registered

You pay the 18% and cannot claim it, so it is a real cost. Compare hosts on the GST-inclusive figure. There is no legitimate way to avoid the tax, and any host offering to bill you without it is offering you a problem, not a discount.

Questions to ask any host before you buy

• Is the advertised price inclusive or exclusive of GST?
• If you are GST-registered: will you receive a tax invoice with your GSTIN on it?
• Does the supplier report its sales in GSTR-1, so the credit appears in your GSTR-2B?

Prices on our hosting price list, including Web & cPanel hosting and KVM VPS hosting, are shown excluding GST. For a billing question, email support@bigdomainhost.com.

This is a general explanation, not tax advice. Your accountant knows your situation; we do not.

Sources (checked 13 November 2026)

• CBIC (Central Board of Indirect Taxes and Customs): GST Acts: the CGST Act and the IGST Act
• Goods and Services Tax Network: Goods & Services Tax portal