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GST applicability on Exporting from 3rd country

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vijay

25 Points Posted on 18 December 2019

Here is the scenario.

My company in India is selling(exporting) a course which is digital(ebooks, online membership material etc) to USA customers. But with it we now plan to include a physical DVD video, that is made by a firm in USA, whom we will ask to ship to our customer also in USA. This will be part of our course(which until now was fully digital)

Process goes like this.

We receive order, we give the customer access to online course, we then contact the USA firm, pay for the DVD and then ask them to ship the DVD to our USA customer directly. The DVD as such is never in India.

What is the GST applicability in this case, especially for the DVD?

Regards
Vijay

Replies (1)

Pankaj Rawat

GST Practitioner

55067 Points Posted on 19 December 2019

Dear Vijay

As per Your Query there are 2 Transaction :

1. Between You & Receptient in
USA
2. Between You & Your supplier In USA.

let's take the First Condition :

The total value of Services agreed to provided by You to Recepeint in USA will be considered as Export Services as it fulfills all the condition lay down in Section 2(6) , 13(11) of IGST Act . Hence it's EXPORT OF SERVICES.

Condition 2:

You (Supplier in India) located in India would be liable to pay IGST on RC basis on Import of Services on that portion of services which has been provided by supplier in USA to Receptient in USA.
HENCE ITS IMPORT OF SERVICES.

For more detail explanation Kindly Refer Circular 78/52/2018 GST DTD. 31/12/2019