NASSCOM Member Queries 2

We are Nasscom member and are in a startup phase. We build products. All our sales are outside India only. Currently we have no service tax number nor do we take any  export benefits anywhere.What I wanted to know is:

Question 1: Do we need to register for GST. I think we may need to do and so have gone ahead with that.


Answer: Yes, any person making a supply of taxable goods or services or both is required to obtain registration in the State from where he is making taxable supplies, if his aggregate turnover in a financial year exceeds twenty lakh rupees (or ten lakhs, in case of Special Category States).


Question 2: Do we need to charge GST to our customers. I don’t think so as per the GST FAQ


Answer:  Tax should not be collected where the supply amounts to an export. A supply would qualify as an export only under the following conditions:

  1. Goods: Taking of goods out of India to a place outside India
    • Note: Tax will be recovered where goods are not exported within three months and fifteen days from date of issue of the invoice for export.
  2. Services: For a service to qualify as an export, five conditions to be satisfied, which are:
    • supplier of services should be located in India;
    • recipient of services should be located outside India;
    • place of supply of services said to be exported, shall be outside India;
    • Payment for the said service is received in convertible foreign exchange;
    • supplier and recipient of services are not mere establishments of the same person (viz., the recipient is not a branch or any other form of office of the exporter in India).


Note: Tax will be recovered if payment of such services is not received by the exporter in convertible foreign exchange within one year and 15 days from the date of issue of invoice for export;

Where any transaction does not qualify as an export, as provided above – the supply would be a taxable supply, attracting GST, which can be collected from the recipient.


 Question 3: Do we get tax reimbursement anywhere? I am not sure on this point.


Answer: As exports are zero-rated supplies, the relevant input tax credits are allowed to be utilised against any other output taxes of the exporter. Alternatively, the exporter may claim refund of such taxes, as prescribed.

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