GST on Tooling development charges to Overseas customer

This query is : Resolved

Munisami (Querist)
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16 November 2022 To manufacture of components we need to develop tool as per the overseas customer specification. Once the tool is developed and after submission of samples approved by customer to raise invoice on overseas customer for tool development charges but tool movement will not happing.

The tool retained by us for further manufacture of components .

Please provide your valuable views in the GST whether GST is applicable on tool development charges on overseas customer or its teared as zero rated supply or service for the tooling cost recovery for which the tool retained by us for further manufacturing of components.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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16 November 2022 One of the consultants in Maharashtra told that they had approached the GST officials in Kolhapur and they have said it is an export of service. His clients do not charge GST treating tools development charges as export of service and receive the payment in foreign Currency.

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