On featurd you sell through your own Stripe or Razorpay account. featurd takes 0% and never holds the money, which also means you're the seller: the tax on each sale is yours to charge and pay. This page covers the basics for the three places our sellers ask about most. It's general information, not tax advice. Rules change and depend on your situation, so check with an accountant (a chartered accountant in India) before you rely on it.
Who owes the tax
There are two ways to sell online. With your own payment account (Stripe, Razorpay), you're the seller of record: you set the price, the buyer pays you, and any sales tax, VAT or GST is your responsibility. With a merchant of record (Gumroad, Lemon Squeezy, Paddle and similar), that company legally resells your product, collects the tax and pays it in each country, and charges a bigger cut for doing so.
featurd is the first kind. What we do is make the tax part easier: we switch on automatic tax where your provider supports it, show prices the right way, and put the tax details on the buyer's receipt.
India: GST
Digital products and online sessions are generally treated as services. Registration is usually required once your aggregate turnover passes ₹20 lakh in a financial year (₹10 lakh in special category states). Below that it's optional for most sellers, but some situations change this, so ask a CA.
Once registered you get a GSTIN, and digital services sold to buyers in India usually carry 18% GST. Sales to buyers outside India can count as export of services, which is zero-rated if you've filed a Letter of Undertaking (LUT) and the money arrives in foreign currency.
Each invoice names a SAC code for what you sold. 998439 (other online content) is the common choice for digital goods; e-books and other text content are sometimes put under 998431 instead. Your CA can confirm the right one for your products.
What featurd does for GST on Razorpay
If you add your GSTIN to your Razorpay connection in Settings → Payments:
- INR prices on your product pages show "incl. GST", so the price buyers see is the price they pay.
- Each buyer's confirmation email carries a GST invoice: your name and GSTIN, the SAC code (998439 unless you change it), an invoice number, the taxable value and the GST included at 18%.
- The GST shown is the total at 18%. Whether it's split as CGST and SGST (buyer in your state) or charged as IGST (buyer in another state) depends on where the buyer is; your returns are where that split is made.
- You still file your GST returns and pay the tax. Keep Razorpay's settlement reports with your invoices.
EU: VAT
Digital services sold to consumers in the EU are taxed where the buyer lives, at that country's VAT rate. If you're based outside the EU, this applies from your first sale to an EU consumer. Sellers based in the EU can charge their home rate until their cross-border EU sales pass €10,000 a year.
Rather than registering in every country, most sellers use the One Stop Shop (OSS): one registration and one quarterly return that covers all EU countries. Sales to VAT-registered businesses usually fall under the reverse charge, where the buyer accounts for the VAT. The UK runs a similar system of its own.
Stripe Tax can work out the right rate for each buyer and add it at checkout. You still register for OSS (or locally) and pay the VAT you collected.
US: sales tax
There's no federal sales tax in the US. Each state sets its own rules, and not every state taxes digital products. You generally only have to collect in a state once your sales there pass its economic nexus threshold, commonly $100,000 a year, and some states also count the number of transactions.
Stripe Tax helps here too: it calculates tax per buyer location, adds it at checkout and tracks your sales against each state's threshold. Registering in a state and filing returns stay with you.
Switching on Stripe Tax
When you connect Stripe, featurd checks whether Stripe Tax is already active on your account. If it is, we turn it on for your checkouts straight away. If it isn't, Settings → Payments shows two steps: turn on Stripe Tax in your Stripe dashboard (it asks for your address and where you're registered), then tap Use Stripe Tax. Stripe charges a fee for Stripe Tax; see its pricing page.
Indian sellers on Razorpay can read our guide to selling digital products in India for UPI, payouts and TDS. See pricing for what each featurd plan includes.