What does a first-time service exporter in India need to set up?

Exporting services from India is mostly paperwork you set up once and then repeat. The rules come from three places: GST law decides whether the work is a zero-rated export and how you invoice it, foreign exchange law decides how the money must reach you, and income tax law decides what you pay on it.⁷³⁵ This checklist walks through all three in the order a new exporter usually meets them.

It applies to any service: tutoring, translation, design, software, content, consulting, architecture, accounting. Rules are as of October 2026.³⁴

What does a first-time service exporter checklist cover?

A first-time service exporter checklist covers the one-time setup across GST, foreign exchange and income tax that every Indian service exporter repeats for each invoice.⁷³⁵

• GST: export status, registration and the Letter of Undertaking (LUT).¹²⁷
• Foreign exchange: the bank account, purpose codes, the Export Declaration Form (EDF) and realisation deadlines.³⁴⁹
• Income tax: presumptive taxation, advance tax, the return and foreign tax credit.⁵⁶¹⁰¹¹

The steps below follow that order.

Who does the first-time service exporter checklist apply to?

The first-time service exporter checklist applies to any person in India whose work counts as an export of services under section 2(6) of the IGST Act: you are in India, the client is outside India, the place of supply is outside India, you are paid in convertible foreign exchange (or rupees where RBI permits), and you and the client are not merely establishments of the same person.⁷

Services with special place-of-supply rules, such as work on goods the client sends you, need a closer look. Use the export of services checker and read place of supply for export of services.

How do you set up as a first-time service exporter in India?

You set up as a first-time service exporter by confirming export status, choosing a bank account, deciding on GST, setting up invoicing, and planning income tax.

1. Confirm export status: check all five conditions in section 2(6) of the IGST Act.⁷
2. Choose a structure and bank account: most first-time exporters start as individuals or sole proprietors, using their PAN and an account with an authorised dealer (AD) bank. The FEMA (Export and Import of Goods and Services) Regulations, 2026 (the 2026 Regulations) do not name a specific account type for export proceeds; regulation 4 requires the bank to satisfy itself that each transaction is genuine before crediting it.³ Banks decide which accounts may receive export receipts. See savings account vs current account for freelancers, export payments into a savings account, sole proprietor vs LLP for freelancers and the checklist for agencies.
3. Decide on GST registration: a supplier making only inter-State supplies of taxable services with aggregate turnover up to ₹20 lakh (₹10 lakh in special category States) is exempt from registration, and export turnover counts towards aggregate turnover.¹ See GST registration for exporters.
4. File an LUT if registered: file a Letter of Undertaking in FORM GST RFD-11 for the financial year before you export, so you can invoice without integrated tax.²¹² See how to file an LUT.
5. Set up invoicing: a registered exporter's invoice follows rule 46 of the CGST Rules, with the export endorsement and the client's country of destination.⁸ See the export invoice format or use the export invoice generator.
6. Choose payment routes and terms: pick a bank wire, a local collection account, a payment aggregator, or a marketplace, and compare fees, inward remittance documents and settlement time with the international payment fee calculator. Agree export payment terms in writing.
7. Prepare for the bank steps: for each foreign receipt, the bank needs a purpose code, five characters, "P" plus four digits, under RBI's FETERS framework, and may ask for the invoice.⁹ See purpose codes for freelancers.
8. Plan income tax: income from foreign clients is taxable in India for a resident, so plan presumptive taxation, advance tax and the return (covered below).⁵⁶¹¹
9. Keep records from day one: keep a folder per client and one tracker of invoices with their realisation deadlines.

What deadlines and documents apply to a first-time service exporter?

A first-time service exporter works to four recurring deadlines: the LUT each financial year, the EDF within 30 days from the end of the invoice month, realisation within nine months, and advance tax instalments.²³⁴⁶

Keep, per client: the contract, invoices, remittance advices or FIRAs, bank credit advices, purpose codes used and EDF acknowledgements. Put the recurring dates in a calendar; see the export compliance calendar and EDF for service exporters.

What happens if a first-time service exporter gets the setup wrong?

If a first-time service exporter exports under an LUT and payment does not arrive in time, rule 96A makes the integrated tax with interest payable.¹² The time limit is one year from the invoice date, or the period allowed under FEMA including any RBI-permitted extension if that is later.¹²

• Late realisation: your AD bank can extend the realisation period on a reasoned request.³ See export realisation period.
• Bank queries: the bank satisfies itself that each transaction is genuine before crediting it, so missing invoices or purpose codes slow the credit.³
• Tax mismatch: income tax and GST records should match the invoices you raised.

Setting up correctly at the start is cheaper than fixing it later.

How is income tax calculated for a first-time service exporter?

Income tax for a first-time service exporter is calculated on income from foreign clients, which is taxable in India for a resident, either on actual profit or under presumptive taxation.⁵

• Presumptive taxation: under section 58(2), Table row 3 of the Income-tax Act, 2025 (the old section 44ADA), eligible resident professionals can declare 50% of gross receipts as income, within the receipt limits.⁵ See presumptive tax for freelancers.
• Advance tax: section 408 sets the instalment dates in the table above.⁶ See advance tax for freelancers.
• Return filing: for non-audit business or professional cases, the return is due by 31 August after the tax year.¹¹ See ITR form for freelancers.
• Foreign tax credit: if a foreign client withholds tax, credit may be available through Form 44 under rule 76 of the Income-tax Rules, 2026, from tax year 2026-27.¹⁰ See foreign withholding tax.

For example, say a tutor declares income under section 58(2), Table row 3: taxable income is 50% of gross receipts, within the receipt limits.⁵

What are the common mistakes made by first-time service exporters?

The common mistakes made by first-time service exporters are assuming every foreign client makes the work an export, skipping the LUT, and not tracking realisation deadlines.²⁴⁷

• Assuming export status: all five conditions in section 2(6) must be met.⁷
• No LUT: a registered exporter files the LUT before exporting.²
• Missing the EDF: from 1 October 2026 every exporter of services gives an EDF to its AD bank.³
• No invoice tracker: each invoice has its own nine-month realisation deadline.⁴
• Ignoring advance tax: the instalment dates in section 408 apply to exporters too.⁶

A one-time review by a chartered accountant of your registration, invoice template and tax approach is worth it for most new exporters. When you are ready for the first payment itself, use the first international client payment checklist.