17/06/2026
🚨 "I Export Services. GST Doesn't Apply To Me."
This is one of the costliest GST myths.
Many freelancers, consultants, agencies and software companies earn from foreign clients and assume:
👉 Foreign client = No GST
❌ Not always.
📌 Export ≠ Exempt Supply
Under GST, exports are:
✅ Zero-Rated Supplies
Not Exempt Supplies.
Why does it matter?
✔ ITC can be claimed
✔ Refund can be claimed
✔ GST burden can effectively become NIL
⚠ But Zero-Rating Is Not Automatic
To export without paying GST, you generally need:
👉 LUT (Letter of Undertaking)
OR
👉 Pay IGST and claim refund
❌ No LUT + No IGST Payment?
Your export may be treated as a normal taxable supply.
Result?
🚨 GST Demand
🚨 Interest
🚨 Notice
📌 Another Common Mistake
Foreign Client ≠ Export of Service
To qualify as export, specific GST conditions must be satisfied.
Miss even one condition and the supply may become taxable.
⚠ Special Risk: Intermediary Services
Many businesses serving overseas clients assume they are exporters.
But if the service is classified as an intermediary service:
👉 GST may become payable @18%
Even if the client is outside India.
📌 Don't Forget Compliance
Exporters must still file:
✔ GSTR-1
✔ GSTR-3B
✔ Refund applications (where applicable)
"No tax" does NOT mean "No GST compliance."
🎯 Final Insight
Getting export GST right can mean:
✔ Full ITC benefit
✔ Faster refunds
✔ No tax cost
Getting it wrong can create an unexpected 18% GST liability.
Foreign income alone does not make a transaction GST-free.
