The first time an Indian studio lands an overseas client, or an NRI who wants their Mumbai flat done up from Dubai, the design brief is the easy part and the GST question is the one that keeps the owner up at night. Do you charge GST or not? Do you need something called an LUT? And why do two clients who both sound "foreign" get treated completely differently on the invoice? I've watched a lot of studios get this wrong in both directions, either charging tax they shouldn't and losing the deal, or skipping tax they owed and paying for it later. So let me walk you through LUT and GST for overseas and NRI design clients in plain language.
The one question that decides everything: where is the property?
Before we touch LUT, you have to understand the single fact that flips the whole treatment, and it's not the client's passport, it's the location of the property you're designing. In GST, services connected to immovable property take their place of supply as the location of that property, full stop. This is the rule interior designers keep tripping over, so let me make it very concrete.
If your client lives in London but the flat you're designing is in Bengaluru, the place of supply is Bengaluru, which means the supply is happening in India and it's taxable in India like any domestic project. The client being abroad changes nothing. But if your client is a company in Dubai and you're designing their office in Dubai, now the place of supply is outside India, and that opens the door to treating it as an export of service. The authoritative wording sits on the CBIC-GST site, and this is one place I'd read the actual rule rather than trust a summary, because the money difference is large.
When it's an export of service, and why the LUT matters
So say you genuinely have an export, the client is outside India, the service is consumed outside India, you're paid in convertible foreign exchange, and the two parties aren't just branches of the same entity. Under GST, an export of service is a zero-rated supply, which means you don't ultimately bear GST on it. Good news. But there are two ways to get there.
Option one, you pay IGST on the invoice and then claim a refund of it later. That's cash out of your pocket now and a refund process to chase, which for a small studio is a genuine working-capital hit. Option two, and this is the one almost every studio should use, you file a Letter of Undertaking, the LUT, which is a simple declaration you submit on the official GST portal that lets you export without paying IGST upfront at all. No tax blocked, no refund to chase.
The LUT is filed once for a financial year and covers all your exports in that year, and it's free to file. So the honest advice is, if you expect any genuine overseas work in a year, file the LUT early and keep the option open, because scrambling to file it after you've raised the invoice is the wrong order.
| Scenario | Place of supply | GST treatment |
|---|---|---|
| NRI client, property in India | India (property location) | Taxable, charge GST as normal |
| Foreign client, project abroad, paid in forex | Outside India | Export of service, zero-rated |
| Export with LUT filed | Outside India | No IGST charged upfront |
| Export without LUT | Outside India | Pay IGST, claim refund later |
The NRI trap, spelled out
Let me hammer the most common mistake because it costs studios real money. An NRI client is not automatically an export client. The vast majority of NRI work an Indian studio does is a property back home, a family flat in Pune, a parents' house in Kochi, an investment apartment in Gurugram. In every one of those, the property is in India, so the place of supply is India, and you charge GST exactly as you would for a resident client. The rupees might come from a foreign account, but that doesn't make it an export.
Getting this wrong in the "helpful" direction, skipping GST because the client is an NRI, is the version that hurts, because the tax was always due and now you're paying it out of your own margin plus interest. So the discipline is simple, ignore the passport, look at the property. And whichever way it lands, your invoice has to be built correctly, which is exactly why the right GST invoice format for interior designers matters so much on cross-border work, because the place-of-supply and currency fields are where these jobs are won or lost on paper.
Getting paid across a border without the mess
Money is the other half of this. For a genuine export you generally need to be paid in convertible foreign exchange and to have proof of that inward remittance, because that proof is part of what makes the supply an export in the first place. So loose "they'll transfer it somehow" arrangements don't cut it, you want a clean payment trail with the remittance documented.
This is also where studios living in spreadsheets really struggle, because a cross-border project has more moving parts, forex receipts, remittance proofs, an LUT reference on the invoice, and a spreadsheet just quietly loses track of them. I laid out why that fragility costs you in why Excel is quietly costing you margin, and it's twice as true on overseas work. The same clean records also feed your income-tax position at year end, since foreign receipts show up there too, and both worlds meet on the Income Tax portal when you file.
Before you treat a client as an export
- Confirm the property being designed is actually outside India
- Check the client is a person or entity located outside India
- Make sure payment will come in convertible foreign exchange
- File your LUT for the financial year before you raise the invoice
- Reference the LUT on the invoice and keep the remittance proof filed
Keep the whole cross-border job on one spine
Here's my operator take after watching studios stumble through their first few international projects. The design isn't harder for an overseas client, the admin is, and the admin only becomes a nightmare when your invoice, your payment record and your books live in three different places. When it all sits on one project record, the LUT reference, the currency, the place-of-supply decision and the remittance proof travel together, and filing time stops being a panic.
If your overseas project also involves shipping any material or samples across, the movement rules stack on top, and I covered those in e-way bills for furniture and material delivery. Underpinning all of it are steady bookkeeping habits for an interior studio, because clean books are what let you claim an export confidently instead of hoping. And because none of this should cost you a fortune, it's worth understanding how Designa's one flat rupee price for the whole studio works, especially when the alternative is paying a foreign tool per seat in the very currency your export headaches are already denominated in.
Key takeaways
- The property location, not the client's passport, decides whether GST applies
- Most NRI projects are Indian property, so they're fully taxable
- A genuine export is zero-rated, and an LUT lets you export without paying IGST upfront
- File the LUT for the year before you invoice, and keep the remittance proof clean
Frequently asked questions
Do I charge GST to an NRI client?
If the property you're designing is in India, yes, you charge GST as normal, because the place of supply for property-linked services is the property's location regardless of where the client lives.
What is an LUT and do I need one?
An LUT, or Letter of Undertaking, is a declaration you file on the GST portal that lets you make genuine export supplies without paying IGST upfront, and you should file it for the year if you expect any overseas work.
When does interior design count as an export of service?
Broadly when the client and the project are outside India, you're paid in convertible foreign exchange, and the parties aren't the same entity, in which case the supply is zero-rated.
Can I skip GST just because the client pays from a foreign account?
No, foreign payment alone doesn't make it an export, and if the property is in India the supply is taxable, so skipping GST there means paying it later out of your own margin.
Cross-border work can be some of the best-paid work a studio does, as long as the tax side is handled cleanly rather than guessed. See how a connected studio keeps invoices, payments and records on one spine at demo.designa.work, and when you want your whole team on one flat founding price billed in rupees with unlimited free client logins, the founding offer is at go.designa.work.