GST while receiving inward remittances

[Vihan S]

We are exporting software/services and as per the contract the transfer costs are born by us, thus the total invoice value is always like 100$ - less the banking charges, so my clients transfer the full $100 and than the intermediary bank (the bank in between my client and the bank appointed by my bank in US) charges around $5 and the rest amount is transferred to my bank who than transfers me the amount in Indian currency on request. Am i liable to pay gst under reverse charge on the $5 i have not received?

[Ganeshan Kalyani]

in my view no.

[Alkesh Jani]

Sir, I agree with the views of Sh. Ganeshan ji

AI Summary

Reverse charge on intermediary banking charges for exported services does not arise where those charges are deducted before remittance. Exporter received payment for exported software/services through an intermediary bank which deducted banking charges before remittance; the question was whether the exporter must pay GST under reverse charge on the deducted charges. Respondents advised that the exporter is not liable to discharge GST under reverse charge on the intermediary bank charges retained in the remittance process.