TaxTMI 
TaxTMI 
Query Regarding GST, ITR Reporting, and Books of Account for Export of Services
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....uery Regarding GST, ITR Reporting, and Books of Account for Export of Services<br> Query (Issue) Started By: - Vineet Kumar Dated:- 14-7-2026 Last Reply Date:- 19-7-2026 Goods and Services Tax - GST<br>Got 4 Replies<br>GST<br>I am providing export of software development services to a client in the United States and have a few queries regarding GST and income tax compliance. I provided services....
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.... for the month of March 2026 and raised an invoice in USD on 31 March 2026. I reported this invoice in GSTR-1 on 5 April 2026, using the applicable RBI exchange rate for GST purposes. The payment for this invoice was credited to my bank account on 24 April 2026. While filing my Income Tax Return (ITR) for FY 2025-26, I noticed that the Annual Information Statement (AIS) reflects the turnover....
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.... reported under GST, which includes the value of this March 2026 invoice. My question is: since the payment for this invoice was actually received in April 2026 (FY 2026-27), should I include this March invoice as income in my ITR for FY 2025-26, or should it be reported in FY 2026-27 when the payment was received? I also have a question regarding the maintenance of books of account. At pres....
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....ent, I maintain only: • The invoices issued to my client, and • The FIRC/Bank advice received for inward remittances. I have no employees or business partners and operate as an individual consultant. Is this sufficient, or am I required to maintain additional books of account? If so, what records should I maintain? Would you recommend using accounting software, or is m....
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....aintaining proper records in Excel acceptable for a business of my size? Reply By Raam Srinivasan Swaminathan Kalpathi: The Reply: Dear Querist For tax purposes you may maintain books either on accrual or cash basis. Choice is yours. Nevertheless, as you have for GST purposes accounted on accrual basis I would urge you to adopt the same for offering your taxable under the Income-tax Act al....
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....so in the same year. Else, you will have to be prepared for Notice requesting reconciliation from the GST department. Books to be maintained under GST is provided in Section 35. In my opinion, if you are not availing ITC the details held by you should suffice. Reply By Vineet Kumar: The Reply: Thanks Raam for your prompt response. For FY-25-26 If I go with accrual but going forward I pr....
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....efer cash basis. Is it okay to switch or are there any implications for switching? Reply By Raam Srinivasan Swaminathan Kalpathi: The Reply: In response to your second query, kindly note that as regards any method of accounting, consistency must be the hallmark. Also, there has to be a reasonable cause for switching from one method of accounting to another. Conventionally, Income-tax departme....
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....nt frowns on any change in method of accounting. With the advent of GST, I would suggest a method of accounting that is congruent and acceptable to both the direct and indirect taxes department. This is purely with the sincere intention of avoiding needless litigation with the resultant expenses to the consultants, etc. Reply By Shilpi Jain: The Reply: Do also maintain any contracts or ord....
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....ers that you have for the works that you are doing. Also in case department wishes to see proof of delivery of your works, like mails, reports, etc. to also be maintained to show that forex has flown for genuine transactions. Ensure that you take care of FEMA compliances as well, receiving forex within specified time limits, filing SOFTEX form, if applicable, which would be EDF (export declarat....
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....ion form) in future (from 1st Oct '26).<br> Discussion Forum - Knowledge Sharing ....