Under GST regime, temporary transfer or permitting the use or enjoyment of intellectual property right constitutes supply of service as per Schedule II read with Section 7 of CGST Act 2017.

Relevant Section: Section 7 of CGST Act 2017

Relevant Section: Section 13(3) of CGST Act 2017

Relevant Schedule: Schedule II of CGST Act 2017

Following are the rates applicable for Intellectual Property Right based on HSN:

HSN	Rate of Tax	Description of Service
99733	12%/[18% from w.e.f. 01/10/2021]*	Temporary or permanent transfer or permitting the use or enjoyment of intellectual property (IP) right in respect of goods other than information technology software.
997331	18%	Temporary or permanent transfer or permitting the use or enjoyment of intellectual property (IP) right in respect of information technology software.
998599	18%	Other support services– management services for rights to industrial property (i.e. trademarks, franchises, etc.).

• Notification no. 11/2017 S. No. 17 has been amended vide Notification no. 06/2021 dated 30/09/2021 and now the combined rate "Temporary or permanent transfer or permitting the use or enjoyment of Intellectual Property (IP) right" is 18%.

Time of Supply

It is important to note, the Time of Supply applicable [Proviso to section 13(3) of CGST Act] to such scenarios.

Earlier of:

• Date of entry in the books of the recipient
• Date of payment

The TOS provision of 60 days for payment to vendor/61st day if unpaid would not be applicable here.