Is GST applicable on services received from a foreign company?

Asked by: Dr. Kris Pouros I  |  Last update: August 22, 2026
Score: 5/5 (22 votes)

Yes, GST (specifically IGST) is applicable on services received from a foreign company (import of services) if the supplier is located outside India, the recipient is in India, and the place of supply is in India. Generally, the Indian recipient must pay the GST under the Reverse Charge Mechanism (RCM).

Is GST applicable for services rendered to foreign companies?

This means if you're acting as a broker or agent located in India—even if the client is based in the US or UK—GST on Services Provided to Foreign Companies will still apply, since the place of supply is considered India.

Do I pay GST on overseas services?

When services are used outside Australia. The supply of service is GST-free if the supply is used or enjoyed outside Australia or the supply is made to a non-resident who is not in Australia when the supply is made.

Do I need to pay GST on imported services?

GST on import of services is required to be paid by the recipient of service in India under reverse charge. However, IGST on import of Online Information Data Base Access and Retrieval (OIDAR) services by a non-taxable online recipient is required to be paid by the supplier os services.

Is GST applicable on international transactions?

GST is applicable on exchange transactions or any other fees charged for foreign exchange transactions. GST is calculated based on two methods, either based on the difference of transaction rate and RBI reference rate or using slab-based methodology.

EU Shocks India! Tax Break Ends on 87% Exports Before FTA | GSP Suspended

24 related questions found

Do we charge GST for services to overseas customers?

Share: Your services are considered international services, which are zero-rated (i.e. GST is charged at 0%), if they fall within the provisions from Section 21(3) of the GST Act.

Do I charge GST to foreign companies?

Under the GST/HST regulations, goods exported outside of Canada and services rendered to non-residents are considered zero-rated supplies. This means they're technically taxable, but at a rate of 0%, so you are not required to charge sales tax.

Do foreign companies have to pay GST?

You must register for GST if your overseas business has a GST turnover of A$75,000 or more from sales connected with Australia and made in the course of your business. You may not need to register for GST if the only sales you make are made through an electronic distribution platform.

Is GST mandatory for export of services?

Indian businesses who export goods and services are considered as a zero-rated supply under goods and services tax (GST) - no GST is levied on such supplies.

How to avoid GST on overseas purchases?

How to Avoid GST on Overseas Purchases Legally

  1. You are 18 or older.
  2. You are not arriving from Malaysia.
  3. You have been outside of Singapore for 48 hours or more.
  4. You are importing an allowable product for your personal use.

Do I need to charge GST for services?

Do I have to register for the GST/HST? Generally, if you provide taxable property and services in Canada and your total taxable revenues exceed $30,000 in any single calendar quarter or in four consecutive calendar quarters, you will have to register for the GST/HST.

Do international transactions have GST?

Goods and Services Tax (GST) is a 10% value-added tax applied to most goods and services sold or consumed in Australia. For international transactions, GST becomes more complex when foreign currency and exchange rates are involved.

What services are exempt from GST?

Example: Healthcare services, educational services, and public utility services (e.g., water supply) are exempt from GST. This exemption is unconditional, meaning the supply is fully exempt from GST without any terms or conditions attached.

What is the GST rate for foreign exchange services?

Currency conversion (USD→INR etc.) attracts 18% GST, but only on the forex service value, not on the entire converted amount. That “service value” is calculated under Rule 32 using either (a) RBI rate vs dealer rate difference, or (b) the slab method (the slabs you listed).

Is GST applicable on professional services?

GST Applicability of Professional Services in India

GST is applicable to virtually all professional services offered in India. GST applies to all the following services: Legal and compliance services. Accounting, auditing, and tax-related services.

Do I charge GST to foreign clients?

Exports Under GST Law

Both goods and services exported are considered zero-rated supplies. This means: You don't need to charge GST to foreign clients. You can claim input tax credit (ITC) refunds on the GST you paid for business purchases.

Is GST applicable on foreign services?

Yes, the import of services is taxable under GST in India. The recipient of the services is liable to pay Integrated Goods and Services Tax (IGST) under the reverse charge mechanism. This applies when the service provider is located outside India, the recipient is in India, and the place of supply is in India.

Is GST registration mandatory for services?

Registration under GST is a legal requirement for businesses. The CGST Act 2017 specifies minimum turnover criteria for registration (Rs 40 lakhs for goods and Rs 20 lakhs for services). Still, certain specific businesses are required to register under the GST, irrespective of their annual turnover.

Are services included in exports?

Exports measures the portion of total U.S. production of goods and services—gross domestic product (GDP)—that is provided to the rest of the world; thus, movements in exports reflect changes in foreign demand for U.S.-produced goods and services.

Do you charge GST on overseas services?

Most exports of goods and services are GST-free if specific conditions are met, such as export timeframes and overseas use. You can still claim GST credits on expenses related to making GST-free exports. Overseas sales may trigger sales tax obligations in other countries, depending on local laws.

Do I have to charge GST on services provided to a US company?

Do I need to charge GST to American (non-Canadian) customers? To answer this, we follow the place-of-supply rules, which means that if the customer is located outside of Canada, no GST needs to be charged.

Who is not eligible for GST?

But persons who are engaged exclusively in the business of supplying goods or services or both that are not liable to tax or wholly exempt from tax or an agriculturist, to the extent of supply of produce out of cultivation of land are not liable to register under GST.

Do all companies have to charge GST?

Check if your business needs to register for GST

You must register for GST if: your business has a GST turnover of $75,000 or more. your non-profit organisation has a GST turnover of $150,000 or more. you provide taxi or limousine travel (including ride-sourcing services like Uber or DiDi) regardless of your GST ...

Do Americans pay GST?

The U.S. is one of the few countries that does not charge VAT or GST. Instead, the U.S. uses state sales tax as its method of taxation.

What are the GST exemptions in Canada?

Examples of exempt supplies include sale of used residential real property, most supplies by registered charities, and most health care (by professional practitioners), educational, and financial services. The GST registration threshold is CAD 30,000 of sales to Canadian consumers annually.