Export of service - payment not received - write off

[Mohideen A]

In case of export of services and the payment is not received and the company decides to write off the receivables (in accordance with provisions of FEMA) then is there any implications for GST for the write off. The original invoice was recorded as Zero rated under LUT.

AI Summary

Exporters Must Pay IGST with Interest if Payment Not Received for Zero-Rated Services per Rule 96A(1)(b) CGST Rules In a discussion forum regarding the export of services, a query was raised about the Goods and Services Tax (GST) implications when payment for exported services is not received and the receivables are written off according to FEMA provisions. The original invoice was zero-rated under a Letter of Undertaking (LUT). Respondents clarified that under Rule 96A(1)(b) of the CGST Rules, 2017, if payment is not received within one year, the exporter must pay Integrated GST (IGST) with interest. All respondents agreed that GST is payable on the export value in such cases.