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03Oct 2016

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Web Hosting Business! Factors That Could Damage It

Hosting by admin

Web hosting business services generally enable individuals and organizations to make their website available over the internet. At its simplest, web hosting business services involve the storage of data on a server of the service provider. When electronic device (e.g. a computer) sends request to view the client’s website. Then host server sends a copy of the client’s stored web page to the electronic device.

The Webhost Infrastructure

A web hosting business company should be as stable and reliable as their infrastructure. Web hosts should develop one of the highest quality and most reliable infrastructures in the web hosting industry. Company purchases and maintains its own equipment located in the same city as their management facilities.

Place of supply

The principal rule with regards to place of supply for services providing Web host is where the supplier belongs. In this context, if the supplier of web host services belongs to Pakistan. Such services follow GST at a standard rate. On the other hand, if the supplier belongs to another country, the supply of service is an out of scope supply. However, if the recipient of the overseas services supplier belongs to Pakistan. Then it considers an imported service and subject to  GST  at a standard  rate and  the  recipient  has  to  account  GST as  if  he/she supply to himself.

Bandwidth overage

Bandwidth overage is where the volume of data that the website transmits has gone above the allotted amount bandwidth. When this situation arises, some

web hosting business

companies will switch off the website while others will automatically add  on  extra  bandwidth  charges  which  are  priced  at  a  different  (usually  much higher) rate than the normal monthly hosting charges. These extra charges don’t penalize the customer , instead, they are to cover the cost that the web hosting  company  has  to  compensate  for  the  extra  bandwidth  quota.  On that account, bandwidth overage is subject to GST at a standard rate.

Govt. Taxes

Some countries require you to charge a sales/use tax on certain services. It is best for you to take a look at your state-specific Department of Revenue site to find out. If you need to charge sales/use tax you will need to get a sales/use tax permit.

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