A mobile app development company that builds iOS and Android apps for foreign clients is a software exporter under the 2026 regulations, and every client invoice goes on one monthly EDF. Because SOFTEX is gone, app builds, maintenance retainers and support invoices are all declared on the same single EDF, filed with your AD bank or STPI within 30 days from the end of the invoice month. The real work is in describing each invoice type correctly.
Key takeaways
- Treat client app builds as software exports: field 1.1 is usually Software, and you can file with your AD bank or STPI.
- Online delivery through code repositories, app store accounts or TestFlight builds is "Internet" in field 1.4.
- Development usually maps to SAC 998314 and purpose code P0807 or P0802, but confirm both.
- Milestone, retainer and pass-through invoices each go in Part 2B as separate rows.
- Revenue from your own apps sold on app stores is a different question from client work; do not mix the two.
How app work maps onto the EDF
Most app studios do three kinds of work for foreign clients: building new apps, maintaining and improving live apps, and occasionally hosting or running backend infrastructure. The EDF handles all of these, but each lands slightly differently.
Field 1.1 asks for the type of export: Goods, Services or Software. Custom app development is software, so Software is the natural choice. If your month also includes pure consulting or design work with no software deliverable, ask your bank whether it wants that shown separately or on the same form.
Software exporters outside an SEZ can file with the AD bank or with STPI. AD banks are now specified authorities on par with STPI, and STPI certification is no longer mandatory. If you are in an SEZ, your EDF goes to the Development Commissioner instead.
Likely codes for app development
These are the codes app studios most often use. They are starting points to confirm with your CA and bank, not rulings.
| Type of work | Likely SAC | Likely purpose code | Comment |
|---|---|---|---|
| New app design and build | 998314 IT design and development | P0807 off-site software exports | Most common for offshore builds |
| Technical consulting, architecture, app audits | 998313 IT consulting and support | P0802 software consultancy | Advice rather than build |
| Ongoing maintenance and bug-fix retainers | 998313 or 998314 | P0807 or P0802 | Depends on whether it is mostly support or development |
| Backend hosting you provide and manage | 998315 hosting and IT infrastructure | Confirm with bank | Only if you supply the hosting yourself |
| UI and UX design only | Confirm with CA | Confirm with bank | Often treated separately from development |
The SAC code finder helps with edge cases. Whatever codes you settle on, use them the same way on the invoice, in Part 2B and in your GST returns.
Invoice patterns and how to declare them
App projects rarely bill in one clean invoice. Here is how the common patterns show up in Part 2B.
Milestone billing
A typical fixed-price project bills on design sign-off, beta delivery and store launch. Each milestone invoice is a separate Part 2B row in the month it is raised, with its own invoice date and 9-month realisation clock. Our guide to milestone billing for export projects covers the invoicing side.
Retainers
Maintenance retainers usually bill monthly, so each month's EDF carries one row per retainer client. If a client pays quarterly in advance, the advance arrives before some invoices exist; keep the advance and later invoices clearly linked in your records and the remarks column.
Usage and pass-through charges
Some studios re-bill third-party costs such as push-notification services or cloud usage. If these appear on your export invoice, they are part of the invoice value in Part 2B. Whether they are part of your export of services for GST is a separate question for your CA.
A worked example: one month at an app studio
Orbit Pixel Apps Pvt Ltd, an Indore studio, had this mix of invoices in November 2026.
| Invoice | Client | Type | Amount | Likely SAC |
|---|---|---|---|---|
| OPA/88 | Fitness start-up, Austin | Beta delivery milestone | USD 14,000 | 998314 |
| OPA/89 | Retail chain, Manchester | Monthly maintenance retainer | GBP 2,200 | 998313 |
| OPA/90 | Health-tech firm, Berlin | App architecture review | EUR 3,800 | 998313 |
| OPA/91 | Fitness start-up, Austin | Cloud usage re-billed | USD 640 | Confirm |
All four go on one November EDF, due by 30 December 2026. Field 1.1 shows Software, field 1.4 shows Internet because the builds and reports were delivered online, and field 1.12 shows Others because all clients pay by direct transfer. At Orbit's book rates the rupee total is ₹18,99,528.
The Austin client pays the USD 14,000 milestone in February 2027, well within the 9-month window. Because that invoice is above ₹10 lakh, Orbit sends its bank the invoice, FIRA and matching instruction. The three smaller invoices go onto Orbit's quarterly realisation declaration once paid.
GST, LUT and realisation for app studios
Export of services is a zero-rated supply when the Section 2(6) IGST Act conditions are met: you are in India, the client is outside India, the place of supply is outside India, you are paid in convertible foreign exchange (or rupees where RBI permits), and you and the client are not merely establishments of the same person. Most studios export under LUT and print "Supply meant for export under LUT without payment of IGST" on each invoice.
The EDF does not change any of that. It is a FEMA declaration that sits alongside your GST and income-tax obligations.
On realisation, the rule is 9 months from each invoice date for foreign-currency invoices. Clients who hold back the final milestone until after launch can push you close to that limit. If a payment looks set to slip, request an extension from your AD bank with reasons before the deadline passes.
Your own apps are a separate question
Many studios also publish their own apps and earn from app store sales, subscriptions or ads. That income does not come from a foreign client you invoiced, and how it fits the EDF framework is a different question from client work. Our article on app developers earning from app stores looks at that situation; for a company, confirm the treatment with your bank and CA rather than assuming.
This is general information, not legal or tax advice.
Frequently asked questions
Should a mobile app company choose Software or Services in field 1.1?
For building and maintaining apps for clients, Software is usually the right choice, since the deliverable is software. Pure design or consulting work without a software deliverable may be better described as Services; ask your bank if your month mixes both.
Can an app development company file the EDF with STPI instead of the bank?
Yes, software exporters outside an SEZ can file with either the AD bank or STPI, as both are specified authorities. STPI certification is no longer mandatory, so many companies simply file with the bank where their payments arrive.
How do I declare a milestone invoice that the client pays months later?
Declare it in the EDF for the month the invoice was raised, regardless of when payment is expected. The 9-month realisation period runs from the invoice date, so track it and request an extension from your bank if needed.
What purpose code applies to offshore app development?
P0807, off-site software exports, is commonly used for development done from India, while P0802 covers software consultancy and implementation. Confirm the code with your bank, and make sure it matches the SAC code and description on your invoice.
Do re-billed cloud costs go on the EDF?
If they are on your export invoice, the full invoice value goes in Part 2B. Whether those charges count as export of services or as reimbursements for GST is a separate question to settle with your CA.
Bottom line
For app studios, the EDF is a monthly snapshot of milestones, retainers and support work, all on one form. Keep codes consistent, track each invoice's 9-month window, and prepare the form quickly with our free EDF form generator.
This guide is general information for Indian businesses, not legal or tax advice. Rules and bank processes change — confirm specifics with your AD bank or chartered accountant.