How to Claim GST Refund in case assesses received money in NRI Account

Hi Ravi,

Good question! Claiming GST refund on export of services when payment is received in NRI accounts requires careful documentation as per GST rules.

Key points:

1. Export of services is zero-rated under GST and eligible for refund of input tax credit or refund of tax paid.

2. Payment receipt proof is essential for claiming refund. As per Notification No. 48/2017-Central Tax (Rate), export of services should be supported by:

   • FIRC (Foreign Inward Remittance Certificate) or

   • Bank realization certificate from authorized dealer showing receipt of foreign currency in the bank account.

3. Receiving payment in NRI account:

   • If the NRI account is a foreign currency account (FCA) maintained in India with authorized dealers, the receipts in such account qualify as receipt of foreign currency.

   • If the NRI account is outside India, then payment is not received in India and may not qualify directly for GST refund on exports (since the export rules require payment receipt in India).

4. Funds transferred later to Indian account:

   • It is important that foreign exchange is received in India, even if initially credited to an NRI account.

   • The export refund claim must be supported by FIRC or bank certificate for actual realization of foreign exchange in India, not just inward remittance in NRI accounts outside India.

Practical steps for claiming GST refund when payment is received in NRI accounts:

• Ensure the NRI account is an authorized FCA in India.

• Obtain FIRC or bank certificate from the authorized dealer confirming receipt of foreign currency against export of services in that NRI account.

• Attach this certificate as proof of export proceeds received for your refund application.

• If payment was initially received in an overseas NRI account and then funds were transferred to India, obtain documentary evidence of inward remittance into India from the bank to support your claim.

Summary:

Recommendation:

• Coordinate with your bank and authorized dealer to get the appropriate FIRC/bank certificate for all export receipts in NRI accounts.

• Keep detailed records of fund transfers from NRI accounts to Indian accounts.

• Consult GST expert if the NRI account is held outside India to understand implications.

If you want, I can help you draft the refund application or list documents required in detail. Let me know!