I sell SaaS subscriptions to individuals abroad: what applies?
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Short answer
Online software sold to consumers abroad is usually an export: section 13(12) of the IGST Act sets the place of supply of online information and database access or retrieval (OIDAR) services at the recipient's location, and a customer is deemed to be in India only if two non-contradictory signals, such as billing address and card country, point there.1 A registered seller files a Letter of Undertaking to invoice without IGST.3 Card receipts through a cross-border payment aggregator are capped at ₹25 lakh per transaction, and each export must be realised within nine months of the invoice date.56
A Jaipur founder sells a note-taking app on monthly plans to individuals in the US, UK and Australia, collected by card through a payment provider. Each subscription is a small service export, and the rules are written for exactly this kind of business.
Is a subscription sold to a consumer abroad an export?
Usually yes. Section 13(12) of the IGST Act makes the place of supply of OIDAR services the location of the recipient.1 With the customer abroad, payment in foreign currency and the other conditions in section 2(6) met, the sale is an export.2 It does not matter that the buyer is an individual rather than a business.
How do I tell Indian customers from foreign ones?
The Explanation to section 13(12) deems a recipient to be in India if any two non-contradictory conditions point there: the address presented online, the card's issuing country, billing address, IP address, the bank's country, the SIM country code, or the fixed landline location.1 Capture at least billing country, card country and IP at checkout. Customers who land in India get a GST invoice; the rest are exports.
What do I do for GST?
If you are registered, file a Letter of Undertaking (LUT) for each financial year and issue export invoices without IGST, with the rule 46 endorsement.3 Rule 96A makes tax payable with interest if payment is not received within one year of the invoice date, which is rarely an issue for card-paid subscriptions.3 See GST on SaaS sold to foreign customers.
What RBI rules apply to card subscriptions?
A cross-border payment aggregator (PA-CB) can process export receipts of up to ₹25 lakh per transaction.5 Every service exporter files an Export Declaration Form (EDF) with its bank within 30 days from the end of the invoice month, and must realise each export within nine months of the invoice date.46 How this works for a high volume of small receipts is something to agree with your bank and provider up front. Compare providers on the compare hub.
What about income tax and foreign taxes?
Subscription revenue is business income of your company or proprietorship, taxed in India. Other countries may tax digital sales to their consumers: the EU's guidance says electronic services to consumers are taxed in the customer's country.7 Because thresholds abroad differ, review your top markets with a chartered accountant before sales grow.
How did we verify this?
We checked this page against the sources below on 28 October 2026. Read our methodology or report an error.
- [1]CBIC: IGST Act, 2017, section 13 (place of supply where supplier or recipient is outside India), sub-section (12)
- [2]CBIC: IGST Act, 2017, section 2 (definitions), clause (6)
- [3]CGST Rules, 2017 (consolidated), rules 46 and 96A, CBIC
- [4]RBI: Foreign Exchange Management (Export and Import of Goods and Services) Regulations, 2026, Notification No. FEMA 23(R)/2026-RB, amended up to 22 September 2026 (regulations 3 and 5)
- [5]RBI: Master Direction on Regulation of Payment Aggregator, 15 September 2025, paragraph 11.d
- [6]RBI: Notification No. FEMA 23(R)/(1)/2026-RB dated 22 September 2026 (amendment to regulation 5)
- [7]European Union, Your Europe: Cross-border VAT rules for services (checked 28 October 2026)
Frequently asked questions
How do I prove a subscriber is outside India?+
Use the signals listed in the Explanation to section 13(12): address given online, card issuing country, billing address, IP address, bank country, SIM country and landline location. Keep them in your billing records.1
Do I charge GST to subscribers in India?+
Yes, if you are registered. A customer deemed located in India under section 13(12) receives a domestic supply.1
Do I need an EDF for every card payment?+
The 2026 Regulations require an Export Declaration Form for every service export, filed monthly or by the payment date for non-software services.4 How banks and aggregators handle thousands of small subscriptions is not spelled out, so ask your bank.
Do other countries tax my sales to their consumers?+
Some do. The EU, for example, says electronic services sold to consumers are taxed in the customer's country.7 Check each market where you have meaningful sales.
This page is general information for Indian service exporters, not tax or legal advice. Rules change and outcomes depend on your facts, so confirm with a chartered accountant before acting.
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