Yes: an Indian KDP author registered for GST gets back the 18% GST on Amazon ads. Every KDP royalty, amazon.in included, is paid by an Amazon company outside India, so your royalties are an export of services: zero-rated. You claim the GST on your ads as input tax credit, and since your exports leave no GST to pay, that credit is refunded in cash. Without registration, the 18% is a pure cost: ₹50,000 of ads a month costs you ₹1,08,000 of GST a year.
For self-published authors living in India, from the CGST and IGST Acts, CBIC notifications, the KDP terms and Amazon Ads help, checked in October 2026. This is information, not tax advice.
Work out your own figures with our free calculator, India preselected
In short
| Your situation | GST on your ads | Cost of ₹10,000 of ads |
|---|---|---|
| No GSTIN | 18%, lost | ₹11,800 |
| Registered, exporting under LUT | 18%, refunded | ₹10,000, after the refund |
What 18% GST costs you
Online advertising is taxed at 18% (9% CGST + 9% SGST, or 18% IGST), under heading 9983 of the GST rate notifications. The September 2025 rate changes left it there.
| Ads a month | GST a month | GST a year |
|---|---|---|
| ₹10,000 | ₹1,800 | ₹21,600 |
| ₹50,000 | ₹9,000 | ₹1,08,000 |
| ₹1,00,000 | ₹18,000 | ₹2,16,000 |
You pay it on amazon.com ads too. India is on Amazon Ads' list of "Countries that collect tax on Electronically Supplied Services". Since October 1, 2023, any "unregistered person" buying online services from abroad is a "non-taxable online recipient" (IGST Act, section 2(16)), and the law names "advertising on the internet" as such a service (section 2(17)). The foreign supplier then charges you 18% IGST.
Why your KDP royalties are a zero-rated export
Every KDP royalty comes from outside India. The KDP terms say "the Amazon party that made the sale" pays you; the parties are companies such as Amazon.com Services LLC, Amazon Media EU S.à r.l. and Amazon Asia-Pacific Holdings Private Limited. For amazon.in, KDP's own tax page says: "Royalty payments for sales on Amazon.in are subject to 10% Singaporean tax withholding." The payer is in Singapore.
Your licence is a service. The CGST Act treats "permitting the use or enjoyment of any intellectual property right" as a supply of services (Schedule II, paragraph 5(c)). Under KDP, you grant Amazon "a nonexclusive, irrevocable, right and license" to sell your books.
It meets the five conditions of an export (IGST Act, section 2(6)):
- You, the supplier, are in India.
- The recipient, the Amazon company, is outside India.
- The place of supply is outside India: for this service, it is where the recipient is (section 13(2)).
- You are paid "in convertible foreign exchange or in Indian rupees wherever permitted by the Reserve Bank of India". Keep your bank's inward remittance records to show it.
- You and Amazon are not two establishments of the same person.
An export is zero-rated (section 16): you charge no GST on your royalties, and you keep the right to the credit on what you buy for them.
How the 18% comes back
- Register for GST voluntarily. Below the ₹20 lakh threshold you are not obliged to, but "a person, though not liable to be registered […] may get himself registered voluntarily" (CGST Act, section 25(3)).
- File a Letter of Undertaking (LUT) in form GST RFD-11, before you export. You then export "without payment of integrated tax".
- Add your GSTIN to Amazon Ads. Ads on amazon.in then carry GST you claim as input tax credit. Ads on amazon.com bought from a foreign Amazon company are taxed by reverse charge: you pay the 18% IGST in cash, then claim it as credit. Advertising is not on the list of blocked credits (section 17(5)).
- Claim the refund of unused credit. Section 54(3) allows it for "zero rated supplies made without payment of tax". File within two years of receiving your royalties. If the refund takes more than 60 days, interest of up to 6% is due (section 56).
Example. You spend ₹50,000 a month on ads and are registered under LUT:
| Per year | Not registered | Registered |
|---|---|---|
| Ads | ₹6,00,000 | ₹6,00,000 |
| GST paid | ₹1,08,000, lost | ₹1,08,000, refunded |
| Real cost | ₹7,08,000 | ₹6,00,000 |
The catch is cash flow and paperwork. You pay the GST first and get it back only when your refund is processed. Add monthly GST returns and an accountant's fee, and compare them with your figures.
If the GST department reads your royalties otherwise, the refund falls: confirm it with an advance ruling before you claim.
How to get a binding answer
An advance ruling binds the department for you: it is "binding only on the applicant" and "on the concerned officer" (CGST Act, section 103). Anyone "registered or desirous of obtaining registration" can apply (section 95), in form GST ARA-01 on the GST portal. The fee is ₹5,000 under the CGST Act and ₹5,000 under your State's Act.
What to ask, or to ask your tax adviser:
- Am I entitled to input tax credit for the GST on my Amazon Ads, including the IGST paid by reverse charge (section 97(2)(d))?
- Am I required to register, given that my only supplies are KDP royalties paid by Amazon companies outside India (section 97(2)(f))?
How to lose less: waste less ad spend
Until you register, every rupee wasted on a click that never sells costs you ₹1.18.
- Add negative keywords on search terms that spend without selling: how negative keywords work.
- Move spend from automatic to manual targeting once you know which searches sell: automatic vs manual targeting.
- Know what a click costs before you raise a bid: what Sponsored Products cost.
Gloriads can do the first two for you every day, by rules you set: for example, add a negative on any search term that spent more than a set amount without a sale.
Frequently asked questions
Do my KDP royalties carry GST once I register?
No. Paid by Amazon companies outside India, they are exports, zero-rated under section 16 of the IGST Act. Under an LUT you charge no GST on them.
Can I get back the GST on ads I bought before registering?
No. Amazon refunds tax only with a "valid VAT/GST registration number" and proof that registration "was active during the billing period" (Amazon Ads help, "Tax refunds").
Do I have to register once I earn ₹20 lakh?
Yes. Exports count in your aggregate turnover, and above ₹20 lakh a year (₹10 lakh in the special category States) registration is compulsory (CGST Act, section 22).
Check your figures
Use the free Amazon Ads tax calculator, India preselected, then take the figure to your accountant.
Authors elsewhere: the UK, Singapore.
Sources
- Notification No. 11/2017-Central Tax (Rate), entry 21, and Notification No. 15/2025-Central Tax (Rate), CBIC
- IGST Act, section 2 (export of services, OIDAR, non-taxable online recipient), CBIC
- IGST Act, section 16 (zero-rated supply), CBIC
- Notification No. 10/2017-Integrated Tax (Rate) (reverse charge on imported services), CBIC
- CGST Act, section 22 (registration threshold), CBIC
- Advance Ruling Mechanism under GST, GST Council
- Countries that collect tax on Electronically Supplied Services and Tax refunds, Amazon Ads help
- KDP Terms and Conditions, sections 5.4 and 5.5, and Tax withholding, Amazon KDP
Gloriads is an Amazon Ads automation platform that creates, monitors and optimizes Sponsored Products, Sponsored Brands, Sponsored Display and Streaming TV campaigns for sellers, brands, authors and agencies, by rules you control. See how it works.