INR deposit received for Exports of Services to US Customer

I have raised an invoice to a US customer for USD 320 for my customized graphics development. I have mentioned 0% IGST as it is "Exports of Services". They sent me money from their Bank of America account in US (Philadelphia) this time and I received it as a direct/pre-converted INR deposit to my current account. Is it still Exports of Services with 0% IGST? 

I am asking this because previously when they sent USD 320 from some other bank, I received it as FX Inward Remittance, and I have to convert it and deposit into my current account from the portal of local Indian Bank (Axis Bank). 

Replies (1)

Hey Ashwin! Great question about export of services and receipt of payment in INR directly.


Key points on Export of Services and IGST 0%:

  1. Export of services under GST means:

    • Supplier is in India

    • Recipient is outside India

    • Place of supply is outside India

    • Payment is received in convertible foreign exchange or in INR wherever permitted by RBI

  2. Payment in INR received for export of services is allowed under RBI’s guidelines (Liberalised Remittance Scheme) if it’s received through proper banking channels.

  3. Whether IGST 0% applies or not?

    • GST law does not mandate that the payment must be received in foreign currency. It says payment can be received in convertible foreign exchange or in INR wherever permitted by RBI.

    • So, receiving INR directly from foreign buyer’s bank account in India is acceptable if routed through banking channels as per RBI norms.


What matters most:

  • Invoice raised with 0% IGST citing export of services

  • Place of supply outside India (US)

  • Recipient outside India (US)

  • Payment received in INR routed through banking channels (even if pre-converted before receipt)


Your case:

  • USD 320 from Bank of America (Philadelphia) sent to your Indian current account as INR deposit

  • This means money was converted outside India before sending or paid in INR directly by foreign bank

  • As long as the payment is routed through banking channels and RBI guidelines are followed, it qualifies as export of services for GST with 0% IGST.


Important:

  • Maintain proof of receipt of payment through banking channels.

  • Maintain contract, invoice and bank statements as documentary evidence for export and 0% IGST claim.


Summary:

Receiving INR directly in your Indian bank from a foreign customer’s foreign bank account is acceptable for export of services under GST and IGST @ 0% can be applied.

Leave a Reply

Your are not logged in . Please login to post replies

Click here to Login / Register  

Company
Featured ARTICLESHIP 06 October 2026
Semi Qualified

AJAY SINGH AND CO LLP

Thane

CA Final

View Details
Company
06 October 2026
Assistant Manager - Audit and Compliance

Ravi K Jain & Co

Noida

Others

View Details
Company
26 September 2026
Chartered Accountant

pushpganga ventures

Pune

CA

View Details
Company
18 September 2026
Accounts & Finance Specialist

ULTRA CHEMICAL WORKS

Thane

CA Final

View Details
Company
ARTICLESHIP 18 September 2026
Industrial Trainee

Twenty Point Nine Five Ventures Private Limited

Noida

CA Inter

View Details
Company
ARTICLESHIP 07 September 2026
Article/ Paid Assistant

Murali and Sumeet Chartered Accountant

Bengaluru

CA Foundation

View Details
Company
ARTICLESHIP 28 September 2026
Junior Accountant

J S P M & Associates LLP

Pune

B.Com

View Details
Company
15 September 2026
Client-site CA associate

Aditya Muley and Co

Mumbai

CA

View Details