GST for export of goods and services in India is zero-rated. Zero-rated supply does not mean that the goods and services have a tax rate of ‘0 ’. It means that the recipient of the supply is entitled to pay ‘0%’ GST to the supplier of goods or services.
This blog will help you underst and GST registration and compliances related issues if you are an exporter of goods or services. It is going to a simple blog for the most searched or most common question that every new exporter in India.
GST on the export of services from India
1. What is the export of services in the context of GST?
Export of services mean a case where the place of supply of service is outside India and the person receiving services is outside India and the provider of services is located in India
2. Is GST registration required if I am an exporter of services?
Export of goods are considered as inter-state supply and under GST law, new GST registration becomes compulsory for any person who is doing the inter-state taxable supply of goods. Unlike in export of goods, Export of services cases is exempt from GST registration for a threshold limit of up to INR 20 Lakhs.
3. Do I need to pay GST while I sell services outside India?
If you are registered under GST as an exporter of services, then you should know that since export is considered as interstate supply so you need to pay IGST in case of export of services. However, the amount of I GST paid in case of export of services can be claimed as refund by the exporter by following a certain procedure as prescribed by the Government. Another alternative that an exporter of services has is that he can apply for a Letter of Undertaking (which is called LUT in short). By taking LUT an exporter of services can make the export without paying any IGST.
4. What is GST Registration procedure for exporter of services in India? Is GST registration online possible?
There is the facility of GST registration online provided on the Government of India portal. https://www.gst.gov.in/.
Other Blog :– Annual Return under GST (Form GSTR-9)
One can collect the documents first then apply by following the instructions given on the website. Or one can approach service providers such as caonweb which are India’s top GST registration service provider. Why take a risk when you have an affordable best quality service providers in the market.
There is a chance that if you file it yourself you might get a notice from the GST department for any error you may make while filing the application of GST registration. Therefore another alternative of GST registration online is caonweb, India’s most trusted tax, and compliance service provider online. GST registration procedure is simple however it could be tricky based on the nature of business.
5. If I have not crossed the threshold limit but I took GST Registration as an exporter of services?
In this case, do I need to comply with GST return filing norms? Yes, once you take GST registration, filing becomes mandatory for you.
GST on exports of goods from India
1.What is export of goods in the context of GST?
Export of goods in simple terms means taking goods out of India to a place outside India. Export of goods is considered as inter-state supply and under GST law, GST registration becomes compulsory for any person who is doing the inter-state taxable supply of goods
2. Is GST registration required for export of goods?
Yes it is mandatory for you to take GST Registration if you are an exporter of goods. Irrespective of the limit of your turnover, it becomes mandatory to take new GST registration for an exporter of goods.
3. Do I need to pay GST while I sell goods outside India?
If you are registered under GST as exporter of goods, then you should know that since export is considered as interstate supply so you need to pay IGST in case of export of goods. However the amount of igst paid in case of export of goods can be claimed as refund by the exporter by following a certain procedure as prescribed by the Government. Another alternative that an exporter of goods has- that he can apply for a Letter of Undertaking (which is called LUT in short). By taking LUT an exporter of goods can make the export without paying any IGST.
Here are some common important points for both exporter of good and services
· What are the important compliances to be kept in mind once my GST Registration procedure is completed? Once you obtain new GST registration, you will be assigned a number which is called GSTIN. Now you are registered under GST. GST return filing becomes mandatory for you.
· What is the compliance of GST return filing in case of exporter of goods or services? GST return filing is mandatory even if you have to pay zero taxes or even if your business is not doing operation currently. Because once a person is registered under GST it becomes mandatory that such GST registered person files GST returns as per the prescribed due dates are given by the Government.
· What are the consequences for late filing or return or no filing of return under GST for export of goods or services? You will have to pay interest and penalty for all these noncompliance’s. It is your tax consultants duty to ensure that your business is filing GST return before the due date and there is zero noncompliance from your side.
How to apply for LUT?
To apply for LUT online you need to login to your GST website. Here are the simple steps on how to file furnish LUT in GST. To apply LUT, here is what you need to follow:
- Login to GST website of the Government
- Click on User Service
- Click on Furnish Letter of Undertaking (LUT)
- Fill the form as per the instruction given
- Submit with EVC or DSC
Is online GST return filing easy and can be self-filed?
Online GST return filing by yourself is the right thing to do only if you have technical knowledge on GST laws. Otherwise, you must go to a Chartered Accountant who can file your GST return in a correct manner.
Chartered Accountant by profession, CA Sanket Agarwal has an experience of above11 years in Cross Border compliance , Import Export , International Taxation & is a passionate content creator.