Is it an export if my foreign client also has an office in India?

A performance marketing agency hired by a US software company, a recruiter working for a German manufacturer or a legal researcher supporting a UK law firm may find that the client also has an office in India. That one fact can change the GST answer.

How does GST decide where the client is located?

GST decides the client's location under section 2(14) of the IGST Act, which sets out the "location of the recipient of services":¹

1. Where the supply is received at a registered place of business, that place.
2. Where it is received at a fixed establishment elsewhere, that establishment.
3. Where it is received at more than one establishment, the establishment most directly concerned with receiving it.
4. Where there is no such place, the recipient's usual place of residence.

For export status, condition (ii) of section 2(6) needs that location to be outside India, and condition (iii) needs the place of supply to be outside India.¹ For most remote services the place of supply is the recipient's location under section 13(2).³

When does the Indian office make it a domestic supply?

The Indian office makes it a domestic supply when it is the establishment that actually receives the service. CBIC Circular No. 161/17/2021-GST explains that a branch, agency or representational office of a foreign company in India is treated as that company's establishment in India.² If your campaign is run for the Indian market, briefed and approved by the Mumbai team and charged to the Indian office's budget, the Indian establishment is likely the one most directly concerned.¹²

If instead the work is commissioned, used and paid for by the head office abroad, for example a global website redesign managed from London, the recipient is more likely located outside India.¹

Does it matter who pays?

Payment is one indicator, not the test. Condition (iv) of section 2(6) needs payment in convertible foreign exchange (or rupees where the RBI permits), but that condition is separate from where the recipient is located.¹ A head office paying in dollars for work received by its Indian branch does not, by itself, make the supply an export.

What records should I keep?

Keep records that show which establishment receives the work:

• The contracting entity's name and address on the agreement and invoice.
• Who briefs, reviews and accepts the deliverables, and where they sit.
• Which entity pays, from which country and account.
• The market the work is for.

Where the facts point both ways, ask the client to confirm in writing which entity receives the service, and check the position with a chartered accountant (CA) before treating the invoices as exports. See the place of supply guide for the wider rules.