Which exchange rate do you use for GST on an export of services invoice?

You invoice a client in Toronto for CAD 6,000, but your GST return is in rupees. Which exchange rate converts one into the other? Many exporters assume GST law prescribes the RBI reference rate or a customs rate. For services, it does neither. Rule 34 of the Central GST (CGST) Rules points instead to accounting principles and to a specific date.¹

This guide sets out what rule 34 says, which date it uses, what it leaves to you, and how to apply it on export invoices. The text is as on the CBIC tax information portal in October 2026.¹

What is the GST exchange rate rule for an export of services invoice?

The GST exchange rate rule for an export of services invoice is rule 34(2) of the CGST Rules, which uses the rate determined under generally accepted accounting principles for the date of time of supply.¹ Rule 34 has two sub-rules, one for goods and one for services.¹

• Rule 34(1), goods: the rate of exchange is "the applicable rate of exchange as notified by the Board under section 14 of the Customs Act, 1962 for the date of time of supply of such goods in terms of section 12 of the Act".¹
• Rule 34(2), services: the rate of exchange is "the applicable rate of exchange determined as per the generally accepted accounting principles for the date of time of supply of such services in terms of section 13 of the Act".¹

The value itself is the transaction value under section 15(1) of the CGST Act: the price actually paid or payable, where the parties are not related and price is the sole consideration.⁴ Rule 34 only converts that price into rupees.

Did rule 34 of the CGST Rules always use accounting principles?

Rule 34 of the CGST Rules did not always use accounting principles. As first notified, rule 34 used one rate for goods and services alike: "the applicable reference rate for that currency as determined by the Reserve Bank of India on the date of time of supply". Notification No. 17/2017-Central Tax, dated 27 July 2017, substituted the rule with the current two-part version.¹ Older articles and invoice templates that still cite the RBI reference rate as mandatory for GST are out of date.

Who does rule 34(2) of the CGST Rules apply to?

Rule 34(2) of the CGST Rules applies to anyone valuing a supply of services priced in a currency other than Indian rupees, which includes every exporter of services.¹

So a freelancer, agency or software company exporting services uses rule 34(2).¹

How do you apply the GST exchange rate to an export of services invoice?

You apply the GST exchange rate to an export of services invoice by fixing a documented rate method, finding the time of supply, and converting the invoice at the rate for that date.¹²

1. Method: agree a rate method with your accountant that fits generally accepted accounting principles, and write it down.¹
2. Date: work out the time of supply under section 13 of the CGST Act.²
3. Rate: take the rate from your chosen source for that date.¹
4. Invoice: show the foreign-currency amount, the rate with its date and source, and the rupee equivalent.
5. Return: report that rupee value in your GST return.

Rule 34 governs the rupee value for GST; it does not require the invoice to be in rupees, so invoice in the currency agreed with the client.¹ See the export invoice format and how to raise an invoice in foreign currency.

Which date's exchange rate applies for GST on an export invoice?

The date that applies for GST on an export invoice is the date of time of supply under section 13 of the CGST Act.¹ Section 13(2) makes the time of supply of services the earliest of:²

• Invoice on time: the invoice date, if the invoice is issued within the prescribed period, or the date of receipt of payment, whichever is earlier.
• Invoice late: the date the service is provided, or the date of receipt of payment, whichever is earlier.

Rule 47 sets the prescribed period at thirty days from the date of supply of the service.³ That gives three common cases:

The table applies section 13(2) and rule 47 to illustrative dates.²³ Section 13(2) treats a payment as received on the earlier of its entry in your books and its credit to your bank account.²

What does "generally accepted accounting principles" mean for the GST exchange rate?

For the GST exchange rate, "generally accepted accounting principles" is not defined further, and rule 34(2) does not mention the RBI reference rate, a bank's TT buying or selling rate, or a mid-market rate.¹ We found no CBIC circular, as of 28 October 2026, that prescribes a particular source for services.

In practice, the rate is the one your books use to record the foreign-currency sale under the accounting framework that applies to your business. Exporters commonly use one of these, and the choice should be agreed with your accountant:

Whichever you pick, apply it consistently and record the source. A mismatch between the rupee value in your GST return and the value in your books is easier to explain if the method is fixed and documented.

What happens when the export payment arrives at a different rate from the GST value?

When the export payment arrives at a different rate, the GST value stays as it was, because rule 34(2) fixes the value at the rate for the date of time of supply and contains no mechanism for revising it when the payment is converted.¹ The rupees credited to your account will almost never match the GST value, because the rate moves and banks or platforms apply their own rates and fees.

• Accounts: the difference is a foreign exchange gain or loss in your accounts, which has income tax consequences. See forex gain or loss on exports.
• Refunds: the refund formula in rule 89(4) measures zero-rated services turnover by payments received in the period, and your Statement 3 lists each invoice against its BRC or FIRC.⁵
• Scrutiny: for goods, CBIC Circular No. 125/44/2019-GST, para 47, directs that the lower of the invoice value and the shipping bill value be used. There is no equivalent paragraph for services, but expect similar scrutiny of invoice and remittance values.⁶

Keep the GST value and the realised value as two separate figures in your records.

How is the GST value of an export invoice calculated?

The GST value of an export invoice is calculated by multiplying the foreign-currency transaction value by the exchange rate for the date of time of supply.¹⁴

• Inputs: the price actually paid or payable under section 15(1), and the rate under rule 34(2).⁴¹
• For example: say a designer invoices a Toronto client CAD 6,000 on 10 November, within thirty days of finishing the work, and the rate in her books for 10 November is ₹60 per CAD (an illustrative figure). The GST value is CAD 6,000 × 60 = ₹3,60,000.¹²³
• Advance: if the client had paid CAD 3,000 in advance on 1 October, that CAD 3,000 is valued at the 1 October rate and the balance at the 10 November rate.²

Use the real rate from your documented source in place of the illustrative ₹60.¹

What are the common mistakes with the exchange rate for GST on export invoices?

The common mistakes with the exchange rate for GST on export invoices come from older rules and from mixing GST with other tax rules.¹

• Old RBI rule: treating the RBI reference rate as mandatory, which stopped with Notification No. 17/2017-Central Tax.¹
• Customs rate: using the customs rate in rule 34(1) for services.¹
• Wrong date: using the payment date when the invoice was issued on time and before payment.²
• Late invoices: forgetting that an invoice more than thirty days late moves the date to the date of provision of service.²³
• Revaluing: changing the GST value when the money converts later.¹
• Mixing taxes: assuming the GST rate is also the income tax rate. See exchange rate for income tax on foreign income. For daily reference rates, the currency converter shows indicative figures.

Because the GST rule leaves the method to accounting principles, the safest approach is a written policy that your chartered accountant (CA) has approved and that you apply to every export invoice.¹