Export through foreign e-commerce site applicability of gst

Import / Export 244 views 2 replies

Lalit Mehta

Stationery Business

21 Points Joined July 2008

I have started export of cushion covers etc through FEDEX Courier (no custom clearance required) on foreign website (e-commerce) in Aug 2017 and receive payment in my bank in INR after deducting all the charges by the foreign e-commerce website.

I want to know, whether it is necessary to show shipping bill in GST return in this case. I have to enter individual invoices per day in GST or enter a consolidated invoice in INR on the basis of payment received in INR. Similarly for accounting purpose I have to enter a consolidated invoice of INR received in Bank on the date of receiving the payment and ignoring all the charges applied by foreign e-commerce site in foreign currency or enter individual invoice on daily basis (converting it to INR) AND on the date of receiving payment in INR I should account for all the expenses in Foreign Currency after taking into account the conversion rate of that date. Kindly advise me also that can I take the GST ITC and can show the sale as export sale.

Replies (2)

Moh Imran

Student

21 Points Joined April 2016

Hello,

To answer a part of your question : One thing is sure that you will need to account for all transactions in INR. The way you do is that you convert the $ amount you charged to the buyer in INR using the rate prescribed by RBI (CBEC) which you can get by following below link:

https://www.cbec.gov.in/Exchange-Rate-Notifications

Once that is done you compare the amount deposited to bank to the INR invoice amount and account for difference as Forex Gain/Loss. For example:

Date : 1st July
Sale : $10
USD Rate on 1st July : Rs 63.50 / $ (as per above link)
Payment deposited in bank : Rs 6250 (considering actual rate on this day as Rs 62.50)

In this case you will show Forex Loss of INR 100 because invoice value will be INR 6350. This example solely excludes GST if you are GST registered you will have to account for GST as well. An thats where the confusion arises - Whether or not you will treat these transactions as exports???

I am facing the same issue. We maily sell on e-commerce websites and get payments via PayPal deposited in bank account in INR. However the shipment value is low Rs200-1000 and dispatched through Courier/Post Office. While submitting GSTR 1 you are required to submit Shipping bills numbers. But in our case it is not feasible and not convenient to get shipping bills from excise for all shipments plus the items do not pass through normal customs route.

Can an expert share some knowledge on this area please? How do we merchant exporters having more than 20-30 shipments per day account for GST? Will we be classified as exporters? Can we submit GST returns without providing shipping bills and get Input Tax Credit? Are we supposed to charge IGST and pay IGST?

Thanks