GST clarification on intermediary definition makes companies exempt from GST18% who outsource their services to foreign entities.

It is clarified that back-office service providers (BPO) outsourcing their services to a foreign company will not be treated as the intermediary which relaxes to them to pay GST 18% on their services as intermediaries face a GST of 18% charge.

To qualify as an intermediary, the following parameter needs to be considered:

• Minimum Three parties
• Acting as an agent, broker, or another similar person
• Engaged in Ancillary services (Facilitating main supply not supplying main services)