For Indian SaaS startups, software exporters, and IT services companies billing US/EU clients — we manage the export benefits, transfer pricing, GST refunds, and tax planning specific to your business model. The work that decides whether your 70% gross margin actually reaches your bank.
80%+ international revenue, billing US/EU customers in USD/EUR. Need export documentation, GST refunds, transfer pricing for inter-company services, and tax planning for the long haul.
Bench rates to US clients, MSA-based contracts, monthly billing. Need clean LUT-based exports, predictable refund cycles, and TDS optimisation on US client withholdings.
Considering SEZ unit setup vs continuing in DTA. The difference is 5-10% of revenue compounded over 10 years — the math is worth doing right before signing the lease.
Lakhs sitting in unclaimed ITC, RFD-01 applications hanging with deficiency memos, GSTR-2A mismatches, LUT renewal delays. We recover the money sitting with the government.
The four-way choice — DTA, SEZ, STPI, foreign subsidiary — is not a "later" decision. The benefits are tied to where the unit is incorporated and operates from Day 1. Move later, miss eligibility. For a 30-person SaaS company with 100% US revenue, this single decision can be ₹4 Cr+ over 10 years.
| Parameter | DTA (Domestic) | SEZ Unit | STPI Unit | Foreign Subsidiary |
|---|---|---|---|---|
| Income tax rate | 22% under 115BAA | 100% deduction first 5 yrs, 50% next 5 (Section 10AA) | 22% — 10A/10B benefits expired | Local (US 21%, Singapore 17%) + India tax on dividend |
| GST on export | Zero rated, refund of ITC via RFD-01 | Zero rated, faster refund process, ab initio exemption | Zero rated, refund of ITC | N/A (foreign jurisdiction) |
| Setup cost & timeline | Low — any office space | Higher — SEZ developer space + approvals (3-4 mo) | Medium — STPI registration + bond execution | Highest — local incorporation + FEMA ODI |
| Operational restrictions | None | Must operate from SEZ premises only | Bonded premises, customs control | Local employment laws, transfer pricing for India ops |
| Repatriation of profits | Direct — already in India | Direct — already in India | Direct — already in India | Dividend / royalty / fees — withholding tax + Indian tax |
| Compliance burden | Standard corporate compliance | SEZ-specific filings + customs reports | STPI quarterly + annual + softex | Highest — two-country compliance |
| Best for | Hybrid revenue (domestic + export), small teams | 100% export, ≥ 25 staff, long-term scale | Export with operational simplicity | US sales presence, IP held abroad, large scale |
30-person SaaS, 100% US revenue, stayed DTA. Eligible for SEZ from incorporation but no one ran the math at Day 1. Lost 9 years of Section 10AA benefit eligibility = ₹4 Cr+ in cumulative tax savings on a profitable trajectory. SEZ benefit cannot be claimed retroactively.
Cost: ~₹4 Cr+ over 10 yearsSaaS founder set up Delaware C-Corp with India team — no TP study. Three years of inter-company billing without TP documentation. Notice from Indian tax authority on AY 2022-23. Reconstructed TP after the fact = panic, audit cycles, expensive.
Cost: ₹38 L tax + 5 mo of distraction40-person company, ₹2.8 Cr stuck in GST refunds. Previous CA filed RFD-01s but never followed up on deficiency memos. ITC sat unclaimed for 18 months. By the time the founder noticed, two RFD-01s had crossed time-bar and partial credit was lost.
Cost: ₹2.4 Cr recovered, ~₹40 L lostIf you are at incorporation, or scaling past 20 people with mostly export revenue — book a structuring call → The math is concrete. The compounding effect over 10 years is concrete.
Every line item that touches a software company file — domestic or export — handled by the same team.
Domestic vs export ratio. Customer concentration. Inter-company billing if applicable. We map this in 60 minutes — and the structuring recommendation falls out of the map.
RFD-01 every month — we do not let your ITC sit with the government. Refund tracker shared monthly. Deficiency memos addressed within 7 days.
GST returns reconciliation, advance tax computation, TP positions, forex revenue recognition — reviewed every quarter so nothing surfaces in March.
Annual TP documentation refresh, tax position planning for next FY, Section 10AA / 80-IAC eligibility check, ESOP year-end tax. Done before the new FY starts.
Software is not a sideline practice for us. We see the same MSA structures, same Stripe payment flows, same Wise transfers, same RazorpayX setups every week. Your stack is our stack.
Not a one-time recovery. Monthly refund filings as standard practice. We track every RFD-01 to closure. If your refund is older than 90 days — that is an exception, not a system.
Direct experience with TP studies for clients with related parties in each. Different benchmarking pools, different functions/risks, different DTAA treatments. We are not Googling Section 92.
SEZ is not an old-world tax concept — it remains the single biggest tax break for export-focused companies post 115BAA. We have set up units in Gujarat SEZ properties and supported clients through Section 10AA computations year-over-year.
Your finance person speaks to the same junior CA every month. Your founder speaks to the same senior CA every quarter. No "let me check with my colleague" — the person handling your file knows your file.
We retain founders from incorporation through Series B. Tax positions in Year 1 affect tax positions in Year 6. Continuity over time = compounding tax efficiency.
The company came to us with a single number stuck in their head: ₹2.8 Cr of unclaimed GST input tax credit. Their previous CA had filed RFD-01 applications quarterly but never followed up on deficiency memos. Some applications had aged past the time-bar. Others sat with vague "documents required" responses unaddressed.
We took over. Reconstructed 18 months of refund applications. Addressed each deficiency memo with proper supporting documentation — invoice copies, FIRC, BRC, GSTR-2A reconciliation. Engaged with the Range Officer for the time-barred applications under condonation grounds. Recovered ₹2.4 Cr within 7 months of takeover. The remaining ₹40 L was time-barred beyond recovery.
Since then, we file RFD-01 monthly. Deficiency memos are addressed within 7 working days. Their refund cycle is now 60-90 days end-to-end.
Three factors: (1) Revenue mix — SEZ benefit only on export turnover; if > 80% export, SEZ wins. (2) Profitability — Section 10AA gives 100% deduction on profits; if you are loss-making, deduction has no current value (carried forward, but devalued). (3) Team size + premises commitment — SEZ requires operating from SEZ space. For a profitable, 25+ person company with mostly US revenue, SEZ saves 22% on profits for 5 years and 11% for next 5 — material. Below those thresholds, DTA is simpler.
Section 10AA grants 100% deduction of profits derived from export by an SEZ unit for the first 5 consecutive AYs, and 50% deduction for the next 5 AYs. Practical effect: for a profitable SaaS company with ₹10 Cr profit fully from export, that's ₹2.2 Cr saved per year for 5 years, then ₹1.1 Cr for 5 years = ~₹16.5 Cr over 10 years. MAT under Section 115JB still applies (15% on book profit) — but the gap is large and worth it.
STPI tax holiday under Section 10A / 10B has expired (sunset clauses ended in AY 2011-12 for 10A, AY 2010-11 for 10B). New STPI units do not get income tax benefit. STPI registration is now mostly used for operational simplicity — softex filings, customs procedures, bonded premises. Tax-wise, STPI = same as DTA = 22% under 115BAA.
Export of services is "zero rated" under IGST. Two routes: (1) With LUT (Letter of Undertaking) — no IGST charged on invoice, ITC on inputs accumulates and is refunded via RFD-01. This is the standard route for most exporters. (2) With IGST payment — pay IGST upfront and claim refund. Operationally heavier, less common. Either way, the export must satisfy the test: place of supply outside India, payment in convertible foreign exchange, supplier and recipient not merely establishments of the same person.
LUT — Letter of Undertaking — is filed annually (Form GST RFD-11) declaring that export will be made without payment of IGST. Validity: one financial year. Without LUT, you must charge IGST on export and claim refund. With LUT, export goes zero-rated with simpler GST refund mechanics. Every export-focused company should file LUT each April. Conditions: not prosecuted under GST/Customs/IT for tax evasion above ₹2.5 Cr.
Statute prescribes 60 days from RFD-01 filing if accepted as is. Reality: deficiency memos extend this. With clean documentation and prompt deficiency response, end-to-end is typically 60-90 days. Without active follow-up, refunds sit indefinitely. We file monthly because (a) cash flow matters and (b) older refunds are harder to push.
Most common reasons: GSTR-2A vs GSTR-3B mismatch, missing FIRC / BRC for export proof, ITC claimed on supplies from non-compliant vendors, place-of-supply documentation insufficient, or LUT validity expired during the refund period. Each of these has a documented response. We address them before re-submission, not at re-submission.
Transfer pricing rules require that transactions between related parties (e.g., Indian SaaS company billing its US parent for engineering services, or Indian subsidiary buying IP licence from foreign holdco) be priced at "arm's length" — what unrelated parties would charge. Applies to all international transactions between Associated Enterprises, regardless of monetary threshold. Documentation is mandatory above ₹1 Cr threshold of international transactions. Form 3CEB filing is annual.
You need a TP study annually establishing arm's length pricing — typically using TNMM (Transactional Net Margin Method) for services. Includes: company-level functional/asset/risk analysis, comparable company benchmarking, margin computation, justification of pricing. Filed annually as Form 3CEB. If transactions exceed ₹50 Cr, additional master file (Form 3CEAA) and possibly CbC report (Form 3CEAD). Without documentation, the AO can make adjustments at his discretion — typically upward, with interest and penalty.
For income tax: revenue is recognised at the rate prevailing on the date of revenue accrual (typically invoice date / contract milestone, depending on accounting policy). Subsequent forex gains or losses on the receivable until collection are accounted as forex gain/loss separately. For Ind AS 21 entities: monetary items (receivables) are translated at closing rate at year-end — exchange differences hit P&L. Most software exporters under ICDS recognise revenue at invoice date.
Yes, if the Indian company is a tax resident and the foreign tax was paid on income that is also taxable in India. File Form 67 (online, before ITR filing). Claim is limited to the lower of: foreign tax paid, or Indian tax on that income. India-US DTAA Article 25 governs the credit — services typically attract 0% withholding under DTAA when proper TRC + Form 10F is given to the US client; but if WHT is deducted, FTC under Section 90 recovers it.
Tax Audit (Section 44AB) applies if your revenue exceeds ₹1 Cr, or ₹10 Cr if cash receipts/payments are below 5%. Most software companies are well under the cash-component limit, so the ₹10 Cr threshold applies. Statutory Audit under Companies Act applies to every Pvt Ltd regardless. Both filings overlap in scope but are separately mandated.
Ind AS 21 — Effects of Changes in Foreign Exchange Rates — applies to entities preparing financials under Ind AS (large unlisted companies above prescribed thresholds, listed entities, IPO-bound entities). It governs: translation of foreign currency transactions, period-end translation of monetary items, and translation of foreign operations. Most early-stage software companies are not Ind AS-applicable and use ICDS / Indian GAAP — simpler treatment, but still subject to ICDS VI rules on forex.
Reverse charge mechanism (RCM) under Section 9(3) of CGST applies. The Indian recipient pays GST at 18% on the import of services, then claims ITC. Practically: every AWS, GitHub Enterprise, Slack, Notion bill from abroad triggers RCM GST. Many companies miss this. If the foreign supplier is registered under OIDAR for B2C, they collect GST themselves; for B2B, the Indian recipient handles it. We track this monthly in your books.
Bring your revenue mix, team size, customer locations, and growth plan. We will model SEZ vs DTA vs foreign sub — and the tax cost of each over 10 years. Concrete numbers. Yours.