IEC is mandatory for businesses who are indulged in import or export transactions and availing benefits under various Government schemes.
All Indian businesses carrying transactions involving import / export of goods must obtain their respective IEC for trouble-free operations regarding their import / export deals. Not just large or registered entities, IEC can even be applied by individuals who are indulged in international transactions through their import / export venture. Generally, IEC is not mandatory for all the imports / exports transactions, such as businesses operating under technology and services domains. Government, however, in the national security interest has mandated the IEC for importing / exporting certain restricted goods, including arms and ammunition, and other businesses involved in international trading of such prohibited items.
Issued by the Directorate General of Foreign Trade (DGFT), IEC is a unique 10-digit alpha-numeric code that provides businesses / individuals with an identity that is valid at all Custom and DGFT offices across India. Moreover, businesses or individuals with IEC can enjoy numerous benefits through various Government initiatives, including Merchandise Export from India Scheme (MEIS) or Service Export from India Scheme (SEIS), Export Promotion Council (EPC), and others.
Experts of Mobiteq payments, therefore, recommend IEC for the organizations operating under varied sectors, irrespective of its requirement at present.
Since IEC is just a code issued for you to smoothly carrying-out your import / export transactions, it does not require filing of any transaction or tax returns to the DGFT.
IEC is an easy to obtain unique code that DGFT allocates to PAN holder. Only one IEC is issued for one PAN that remains valid for life and works across all over India.
There is no need to incorporate a business entity for obtaining an IEC, sole proprietors carrying import / export transaction can easily obtain IEC in their own name.
In case of transferring money to abroad, importers need to show their IEC to banks, while exporters need to present IEC to banks for receiving money from foreign nations.
You need to prepare a few of the documents as per the legal entity :-
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