Quoted in euros, paid in rupees: the rate on each invoice

Your Europe departure is priced in euros because the DMC bills you in euros. Your client pays you in rupees, in two or three instalments, each on a different day at a different rate. That one fact decides three numbers every time: the GST value, the TCS, and the rupee figure on the receipt. Get any one wrong and your GSTR-1, your TCS statement and the client's euro balance stop agreeing.

One failure mode recurs on cross-currency bookings: a rupee payment gets keyed in at an exchange rate of 1, so a ₹1,00,000 receipt credits as if 1,00,000 units of the quote currency had landed. The balance looks fully paid. It isn't.

This post sets the rule for each number, works a three-instalment euro booking end to end, and gives you the receipt lines, the clause and the month-end check that keep everything in step.

The rule in one line: tax the rupees that land

When a resident client pays rupees against a package priced in euros, the rupee amount actually received is what matters for tax, on three fronts at once. Under section 13(2) of the CGST Act, the time of supply for a service is the invoice date (if issued on time) or the payment date, whichever is earlier, and the payment date is the earlier of the day it's entered in your books or credited to your bank. Each instalment is its own time of supply, for the part it covers.

Under section 15(1), the value of supply is "the price actually paid or payable", and section 15(2)(c) adds "any amount charged for anything done by the supplier in respect of the supply". The rupees actually paid for the package, including whatever margin sits inside your rate of exchange (ROE) over a bank or reference rate, are the GST value. That's reasoning from the Act, not a CBIC clarification for this exact case, so flag it to your CA, but it follows directly: your ROE margin is part of the price, taxed at the package rate, not a forex gain outside GST.

TCS runs on the same logic: the Income-tax Act collects 2% at the earlier of debit or receipt, with no separate conversion rule.

That leaves the exchange rate one job: how many euros come off the balance, not how much tax you owe. For a resident client paying rupees, CGST Rule 34 only comes in once you invoice a euro amount before it's paid, covered below.

Two ways to price in euros, and who carries the move

There are two honest ways to run a euro-priced package against rupee payments. The difference is who carries a rate move.

Question	Lock rupees (Model A)	Convert per payment (Model B)
Who carries a euro move?	You, until euros are bought/locked	Client, instalment to instalment
On the receipt	One rupee price, fixed at booking	A different figure each time
GST charged on	Locked value, split across instalments	Value actually received, each time

Running Model A: size the cushion and write the clause per the rupee-quote buffer post. This post works through Model B, where the euro price stays live and drift is most common.

What Rule 34 says, and the only time it decides your number

Rule 34(2) of the CGST Rules reads: "The rate of exchange for determination of value of taxable services shall be 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." That wording came by Notification No. 17/2017-Central Tax, 27 July 2017; before that, it pointed to "the applicable reference rate... as determined by the Reserve Bank of India." For a service like a tour package, it's pointed to a GAAP rate, not an RBI-mandated one, since 2017.

What counts as GAAP: AS 11 records a transaction "by applying to the foreign currency amount the exchange rate between the reporting currency and the foreign currency at the date of the transaction," with an average rate for a week or a month allowed for practical reasons, but "if exchange rates fluctuate significantly, the use of the average rate for a period is unreliable" (SKF India Ltd v. CCE Pune-I, CESTAT, 2018, quoting AS 11). In practice: the spot rate, or a stable average, applied consistently.

For reference, the FBIL rates on the RBI website as of 16 October 2026, 1 pm, were ₹106.6995/EUR and ₹95.0194/USD: one acceptable GAAP input, and the only real rates in this post; everything below is illustrative.

For a resident client paying rupees, the rule has one practical trigger: a tax invoice for a euro amount raised before the client has paid it. Invoice or receipt every instalment on or after the day the rupees land, and on this reading Rule 34 never comes up, because section 15(1) already fixed the value.

The calculator: one Europe booking, three instalments

Take a Europe land package for two travellers, EUR 2,750 pp, EUR 5,500 total, ex-GST and ex-TCS, Model B. Rates below are illustrative except the 16 October FBIL figures above.

Instalment	Date, EUR credited	ROE (₹/EUR, illustrative)	Package value (INR)
I1	12 Jun, EUR 2,000	104.50	₹2,09,000
I2	14 Aug, EUR 2,000	106.00	₹2,12,000
I3	9 Oct, EUR 1,500	108.00	₹1,62,000

Instalment	GST @ 5%	TCS @ 2% (gross base)	Client pays
I1	₹10,450	₹4,389	₹2,23,839
I2	₹10,600	₹4,452	₹2,27,052
I3	₹8,100	₹3,402	₹1,73,502

Totals: package value ₹5,83,000 for EUR 5,500, blended ₹106.00/EUR; GST ₹29,150; TCS ₹12,243 on the gross base (TCS is 2% of the amount received, and that amount includes GST); client pays ₹6,24,393 across three instalments.

Each instalment's rupee package value goes into that month's GSTR-1 as an advance (see GST on booking advances for the Table 11A/11B mechanics). TCS deposits by the 7th of the next month: ₹4,389 by 7 July, ₹4,452 by 7 September, ₹3,402 by 7 November, reported in your quarterly TCS returns for the Apr-Jun, Jul-Sep and Oct-Dec quarters.

Example: The client sends a flat ₹1,00,000 on 14 Aug instead of a round number of euros. At ₹106.00, back-solving on the gross TCS base: package ₹1,00,000 / (1.05 x 1.02) = ₹93,370, GST ₹4,669, TCS ₹1,961, adding back to ₹1,00,000. That credits EUR 93,370 / 106.00 = EUR 880.85. The euros come from backing out the tax, not from dividing ₹1,00,000 by the ROE.

Compare to Model A: locked at ₹104.50, EUR 5,500 x 104.50 = ₹5,74,750 of package value, ₹8,250 less than Model B's ₹5,83,000 because the rupee moved, with GST of ₹28,738. That gap sits with you in Model A, unless you bought euros early, and with the client in Model B.

Careful: No receipt should carry a blank rate or a rate of 1. ₹1,00,000 keyed at a rate of 1 against this EUR 5,500 booking credits as EUR 1,00,000, wiping out the balance on paper, with GST and TCS behind it wrong too. Any ROE more than a few per cent from that day's FBIL rate needs a second look.

TCS: 2% of rupees, on the day they land

TCS on an overseas tour package is 2% of the rupee amount (5% if the client hasn't given a PAN, and none if the client has deducted TDS on the payment), charged at the earlier of debiting the client's account or receiving the money, with no separate conversion step. Rule 207 of the Income-tax Rules, 2026 fixes a conversion rate, the SBI TT buying rate, but only for TDS on income payable in foreign currency to someone outside India, or to or by an IFSC unit. It says nothing about TCS on a package paid in rupees.

The base is gross, package plus GST: the Income-tax Act charges 2% of the amount debited or received, and nothing in it takes GST out, which is why the tables above use gross. We found no CBDT clarification specific to tour packages as of October 2026. TCS doesn't inflate GST value: a 2019 CBIC corrigendum confirms it "would not be includible" in the value of supply, being an interim levy on the buyer's possible income. It was written for the 1961 Act and hasn't been reissued for the 2025 one.

Deposit by the 7th of the following month (check the March due date with your CA), file your quarterly TCS return, and give the client the TCS certificate, all under the Income-tax Rules, 2026: current law from 1 April 2026, see the TCS playbook for the full mechanics. Instalments received before that date fell under the old Act's TCS rules and the earlier two-tier rates; don't mix cut-overs on a booking that straddles it.

The receipt lines that keep all three figures in step

Print the rupee amount as the figure that matters, the rate and its source, and the euro balance as a running memo, on every receipt:

Receipt R2 | 14 Aug 2026 | Booking EU-26-118 (2 pax)

Amount received (credited 14 Aug 2026)        Rs 2,27,052
  Package (land) value                         Rs 2,12,000
  GST @ 5% (CGST 2.5% + SGST 2.5%)             Rs 10,600
  TCS @ 2% (Income-tax Act)                    Rs 4,452

Converted at ROE Rs 106.00/EUR
  ([Bank] TT selling rate, 11:00 am, 14 Aug 2026)

EUR credited                                   EUR 2,000.00
EUR price EUR 5,500.00 | paid to date EUR 4,000.00 | balance EUR 1,500.00

Note: the rupee figures above are the amounts received and taxed.
The euro figures are a memo of your running balance only.

• Rupee amount first, as the operative figure. GST is paid in rupees, and Rule 50 (receipt-voucher particulars under section 31(3)(d)) doesn't name a currency.
• Rate, source and time, not just a number, so it can be checked later, and the euro balance restated every time, so the client never has to add up old receipts.

Add the standard receipt-voucher fields (GSTIN, serial number, client details, place of supply, reverse charge) the way the advance receipt format post lays them out; this post only adds the currency block.

The final invoice: add up the rupees, never re-convert

Your final tax invoice's taxable value is the sum of the rupee package portions already taxed, ₹5,83,000 here, with the euro total as a description line ("EUR 5,500 land package, 2 pax, converted per receipts R1-R3, blended ₹106.00/EUR"). GST on that ₹5,83,000 was already paid instalment by instalment; the invoice adjusts those advances out, never re-converting the full EUR 5,500 at the invoice date's rate.

Rule 47 gives 30 days from the date of supply to invoice. Rule 46 requires the taxable value, rate and tax amount; an unregistered client with taxable value ₹50,000 or more also needs name, address and State on it. If a balance is still unpaid when this invoice falls due, don't invoice it in euros converted fresh; the next section covers why.

Where a forex gain or loss line actually comes from

On a booking like this, a real exchange gain or loss comes from two places, and neither is the ROE margin on a payment already received in full.

First, a DMC bill booked in euros and settled later at another rate. A EUR 1,000 deposit at ₹104.90 costs ₹1,04,900, fixed that day. A EUR 3,600 balance billed at ₹107.00 (₹3,85,200) but paid at ₹107.60 (₹3,87,360) sends the ₹2,160 gap to Forex Gain/Loss, not package cost, per AS 11 and section 43 (old 43AA). Confirm entries with your CA.

The second is the one to avoid: invoicing a euro balance before it's paid. Raise the final invoice on 1 October while EUR 1,500 is unpaid, and Rule 34(2) applies: at an illustrative ₹107.20, the invoiced value is ₹1,60,800 and GST ₹8,040; if you debit the client's account that day, TCS arguably falls due on the debit, ₹3,377 on ₹1,68,840 (gross base). The client pays on 9 October at the contract rate of ₹108.00, ₹1,62,000. That same EUR 1,500 now sits on three rupee figures, with a ₹1,200 gap that's either a debit note (₹60 more GST) or an exchange difference outside the value of supply, unsettled.

SKF India (CESTAT, 2018), a service-tax reverse-charge case on services from overseas associated enterprises, held that tax is determined when the transaction is reflected in the books "and not when the payment is made"; it's pre-GST, so persuasive at best. Simplest fix: collect the balance before the final invoice, or bill it in rupees at a stated rate and collect exactly that.

The clause that tells the client which rate applies

Put this in the quote or booking form, so whoever issues receipts applies it the same way every time:

Prices are in euros (EUR). You pay us in Indian rupees.

Each payment is converted at [Bank]'s TT selling rate for EUR at
11:00 am on the day it is credited to our account [alternative:
the FBIL reference rate on RBI's website for that day, plus 1%].

Your receipt shows the rupee amount, the rate applied, and the euros
credited, and restates your remaining euro balance.

GST at 5% and TCS at 2% are charged on the rupee amount of each
payment.

The euro balance must be cleared before we issue the final invoice.
The final invoice adds up the rupees already received; it does not
re-convert the euro price.

Two sentences carry the weight. "You pay us in Indian rupees": RBI's FAQ on forex transactions says a resident may transact forex only with an authorised person for a permitted purpose, and an ordinary agency isn't one, so this clause sets the rate used to convert rupees received, not permission to collect the booking in foreign currency. "The euro balance must be cleared before the final invoice": that's the line that keeps you out of the Rule 34 trap above.

Month-end check for every foreign-currency booking

Run this before closing the month's books, on every live EUR/USD booking:

• EUR price minus EUR credited to date equals the EUR balance on the last receipt.
• No receipt carries a blank rate or a rate of 1; every ROE sits within a few per cent of that day's FBIL rate.
• Rupee package values received this month equal the advances reported in this month's GSTR-1, at 5% GST.
• TCS collected equals 2% of the GST-inclusive amount on each receipt, deposited by the 7th.
• No final invoice was raised on a booking with an unpaid euro balance.
• Any DMC bill settled this month has its exchange difference in Forex Gain/Loss, not folded into package cost.

Common questions

Dollar mein quote, rupee mein payment: GST kis rate pe lagega?

GST lagta hai us rupee amount par jo client ne package ke liye actually pay kiya. Exchange rate sirf euro ya dollar balance kam karne ke liye use hota hai, GST ke liye nahi, jab tak koi unpaid balance invoice na ho.

Can my client pay me in euros or dollars directly?

Generally no. RBI's FAQ on forex transactions says a resident may transact forex only with an authorised person, such as an authorised dealer bank, for a permitted purpose, and an ordinary agency isn't one. Collect from resident clients in rupees.

Is TCS charged on the GST amount too?

Yes. TCS is 2% of the amount you receive, and that amount includes GST; nothing in the Income-tax Act takes GST out. It doesn't work the other way round: GST is not charged on TCS. We found no CBDT clarification specific to tour packages as of October 2026.

Which exchange rate goes on a GST invoice in foreign currency?

Only when invoicing a euro or dollar amount before it's paid: Rule 34(2) points to the GAAP rate for the date of time of supply, in practice the spot rate or a stable average. If the client has already paid in rupees, there's nothing to convert.

The short version

• The rupees your client actually pays on each instalment set the GST value, the TCS base and the receipt figure; the rate only decides how many euros come off the balance.
• Pick one contract model: lock a rupee price at booking (you carry the rate move) or convert each payment on the day it's credited (the client does).
• Rule 34(2) only matters when you invoice a euro amount before it's paid; it points to a GAAP rate, not a mandated RBI rate, since the July 2017 change.
• TCS is 2% of the rupees debited or received, GST included, with no separate conversion rule.
• Every receipt should show the rupee amount, the rate with its source and time, and the running euro balance, never a blank rate or a rate of 1.
• Clear the euro balance before the final invoice; an unpaid balance invoiced in euros forces a Rule 34 conversion and can split the three figures apart.
• A genuine forex gain or loss comes from a DMC bill settled later at a different rate, never from the ROE margin on money already received. Confirm the treatment with your CA.