IEC Code for export of services

Is IEC Code Necessary for Export of Services/Service Exporters?

Exporting Services Worldwide? Confused Whether to take IEC Code or Not? Let us Help You.

Import and export of commodities can be done with Import Export License (IEC) but what about providing services internationally? Is there any need for IEC for exporting services? Have a look below to know more.

What is the meaning of Service Exports?

Exporting of Services normally means Services that are provided outside India and the reimbursement is received in exchangeable foreign currency. In a simpler language, it is providing services by a person/ entity of one country to a different country, its residents or companies etc.

Here are some Examples of Export Services

  1. Architects designing your house siting in London while your house is in India.
  2. International Call center support provided to users from outside the country.
  3. Tax Consultants in India providing advice to foreign companies.

There are number of example of exporting services. But the concern is, is there a need for IMPORT EXPORT LICENCE TO EXPORT SERVICES ?

Is IEC Code required for Export of Services?

The 10 numbered code that is also known as import export license is necessary for Import and Export of goods but not for exporting services.

IEC for Exporting Service

In case of import or export of services or technology the IEC is required only when the service supplier is captivating benefit from the foreign trade policy or is dealing with specified services or specified technologies under Section 7 of Foreign Trade (Development & Regulation) Amendment Act, 2010.

What are “Specified Services”?

“Specified services” means any services which is prohibited or restricted because of the national security of India. So if you’re dealing with any specified service under foreign trade policy then only you need Importer Exporter code else it is not mandatory.

Dealing in software or any consulting services need not require any Import export license. So now you can go ahead providing services freely without any confusion.

Benefits to get IEC Code for Service Exporters

One of the prime advantages of getting IEC is Service Exports from India Scheme (SEIS). In the scheme, service providers, situated in India, would be provided incentives under the SEIS scheme, for all eligible export of services from India. Incentive would be in the form of Duty Credit Scrip. Incentive Rate varies from 5% to 7% of net Foreign Exchange earned.

SEIS Scheme Eligibility

Service Providers of notified services, located in India are eligible for the Service Exports from India Scheme. In order to claim reward under the SEIS scheme, the service provider shall have to have an IEC at the time of providing such services for which rewards are claimed.

IEC Code for SEIS Scheme

Why is IEC Code Compulsory?

Reward Rate for various services:

Research and Development Services – Rewarding rate is 5 percent

    • R&D tune-up on natural sciences
    • services on social sciences and humanities
    • Interdisciplinary R&D services

Professional Services – Rewarding rate is 5 percent

    • Legal services
    • Accounting, auditing and bookkeeping services
    • services of Taxation
    • services of Architecture
    • Engineering services
    • Integrated engineering services
    • Urban planning and landscape architectural services
    • Medical and dental check
    • Veterinary services assistance
    • Assistance provided by nurses, physiotherapists and paramedical personnel

Audiovisual Services – Rewarding rate is 5 percent

    • Motion picture and video tape production and distribution service
    • Motion picture projection service
    • Radio and television services
    • Radio and television transmission services
    • Sound recording

Construction and Related Engineering Services – Rewarding rate is 5 percent

    • General construction work for building
    • General construction work for civil engineering
    • Installation and assembly work
    • Building completion and finishing work

Educational Services  – Rewarding rate is 5 percent

    • Primary education services
    • Secondary education services
    • Higher education services
    • Adult education

Environmental Services – Rewarding rate is 5 percent

    • Sewage services
    • Refuse disposal services
    • Sanitation and similar services

Health and Social Services – Rewarding rate is 5 percent

    • Hospital services

Tourism and Travel Services – Rewarding rate is 3 or 5 percent

    • Hotel (3% Rate of Reward)
    • Restaurants (3% Rate of Reward)
    • Travel agencies and tour operators services (5% Rate of Reward)
    • Tourist guides services (5% Rate of Reward)

Recreational, Cultural and Sporting Services – Rewarding rate is 5 percent

    • Entertainment services News agency services
    • Libraries, archives, museums benefit
    • Sporting and other recreational assistance

Transport & Auxiliary Services – Rewarding rate is 5 percent

    • Passenger transportation
    • Freight transportation
    • Rental of vessels with crew
    • Maintenance and repair of vessels
    • Pushing and towing services
    • Supporting services for maritime transport
    • Rental of aircraft with crew
    • Maintenance and repair of aircraft
    • Airport Operations and ground handling
    • Rental of commercial vehicles with operator
    • Maintenance and repair of road transport equipment
    • Supporting services for road transport services
    • Cargo-handling services
    • Storage and warehouse services
    • Freight transport agency services

Other Business Services – Rewarding rate is 5 percent

    • Advertising services
    • Market research and public opinion polling services
    • Management consulting service
    • Services related to management consulting
    • Technical testing and analysis services
    • Services incidental to agricultural, hunting, fishing, mining, manufacturing and energy distribution
    • Placement and supply services of personnel
    • Investigation and security
    • Related scientific and technical consulting services
    • Building- cleaning services
    • Photographic services
    • Packaging services
    • Printing, publishing
    • Convention services

We hope now you’re clear about IEC Code Registration for export of services . In case of any further assistance feel free to contact us anytime. We are always there for you.

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