When Indian IT and ITeS companies export software services or products abroad, they must comply with Softex filing requirements under the Foreign Exchange Management Act (FEMA) and RBI guidelines. While most businesses are familiar with obtaining Softex registration through STPI (Software Technology Parks of India) or SEZ authorities, many overlook the ongoing compliance responsibilities that follow post-registration.
This article explains the key aspects of Softex compliances and filing obligations that exporters should be aware of after registration.
The Softex Form is a statutory declaration that every software exporter must submit to STPI/SEZ. It records the details of foreign exchange earned through export of software services or products. Unlike a shipping bill for physical goods, Softex acts as a “digital shipping bill” for intangible exports.
Invoice Reporting
Every export invoice raised in foreign currency must be reported in Softex.
Invoices are grouped and filed in the form, along with key details like invoice number, value, client name, country, and description of services.
Filing must be done within 30 days of invoice date.
Monthly/Quarterly Filing
STPI/SEZ generally requires invoices to be consolidated and filed on a monthly or quarterly basis.
Regular monitoring is essential to ensure no invoice is missed.
Foreign Exchange Realisation
Once payment is received in India, the amount must match the declared Softex invoice.
The Authorised Dealer Bank (AD Bank) issues a Bank Realisation Certificate (BRC) linking inward remittance with Softex declarations.
Discrepancy Handling
Any mismatch between declared value and realised value must be explained.
Amendments to Softex filings may be required if partial or excess realisations occur.
Record Maintenance
Maintain copies of all Softex forms, invoices, agreements, and BRCs for compliance checks.
STPI/SEZ authorities may ask for audits or clarifications.
Annual Reporting
RBI and STPI/SEZ require annual export performance reports.
Details from Softex forms form the basis for these reports, so accuracy is critical.
Failure to file Softex forms on time can result in:
FEMA penalties for misreporting foreign exchange.
Delays in export proceeds realisation.
Issues in future STPI/SEZ approvals and certifications.
At TAXAJ, we support IT and ITeS exporters with:
Softex registration with STPI/SEZ.
Periodic Softex filings (monthly/quarterly).
Liaison with Authorised Dealer Banks for BRCs.
Corrections and amendments in case of mismatches.
End-to-end compliance under FEMA, RBI, and STPI/SEZ regulations.
With our team of Chartered Accountants and compliance professionals, you can focus on your core software business while we ensure all Softex filings are accurate and on time.
Softex compliance is not just a one-time registration process but an ongoing responsibility. Timely filing and accurate reporting protect your business from FEMA penalties, improve your credibility with banks and regulators, and ensure smooth foreign exchange inflows.
If you’re an exporter of software or IT services, staying compliant with Softex is non-negotiable. With expert guidance from TAXAJ, your Softex filings can be smooth, timely, and hassle-free.