GST GST Returns

Step-by-Step Guide to GST Refund Claims

Step-by-Step Guide to GST Refund Claims

To receive a GST refund, the taxpayer must go through a lengthy process and submit every required document and declaration to the GST authorities. The existing balance in the electronic cash ledger that was deposited in excess, the tax that was mistakenly paid, or the accrued Input Tax Credit (ITC) that was unable to be used for tax payments because of zero-rated sales or an inverted tax structure are all examples of refunds under GST.

Depending on the type of GST refund being requested, several forms are used to submit claims. For instance, it is only necessary to disclose information in the GSTR-1 and GSTR-3B to request a refund of IGST paid on exports (with tax payment). The form RFD-01 must be used to request a refund of any cash paid in excess of the electronic cash ledger. As a result, depending on the type of GST refund, the procedures or process vary.

When GST Refund can be claimed?

  1. Before the expiration of two years from the relevant date, a refund of any balance in the electronic cash ledger may be requested in the return submitted under section 39 in Forms GSTR 3, GSTR 4, and GSTR 7.
  2. Refund of tax paid on inbound supplies of goods or services or both by a UNO specialized agency, a consulate, or an embassy of a foreign country upon filing a refund claim within six months after the end of the quarter in which such supply was received.
  3. At the conclusion of any tax period, a registered person may request a return of an unused input tax credit.
  4. Export of products, services, or both after IGST payment.
  5. Tax payment on a provisional basis.
  6. Although paid on intrastate supplies, CGST, SGST, and UTGST are retained as interstate supplies.
  7. A Casual Taxable Person or Non-Resident Taxable Person who paid advance tax in accordance with Section 27(2).
  8. Excessive tax payment.
  9. Refunds are allowed in the following situations:
  • Completion of the preliminary evaluation.
  • Favourable decision made by an appellate body that benefits any taxpayer.
  • Completion of the inquiry process; absence or reduction of tax liability.
  • Refund for mistakenly paid taxes, such as IGST instead of CGST/SGST or vice versa.
  1. Refund to international tourist: In cases where an international tourist purchased goods in India and requests a refund of the IGST paid, the refund of the IGST paid will be made available at the port of exit, provided that sufficient documentation supporting the claim that the person entered India as a tourist for legitimate non-immigrant purposes has been provided. The international traveller, however, will not include:
  • Whether or not they have an Indian passport, residents of India who are leaving the nation for an extended period of time are subject to this rule.
  • Delegation of Indian residents to diplomatic missions abroad.
  • Children born to foreign nationals while they are still living in India.

How to submit a refund pre-application form?

Taxpayers must take out a form called the Refund Pre-application in order to provide facts about their company, Aadhaar number, income tax information, export information, expenditure and investment information, and so on. This pre-application form must be submitted by the taxpayer for all sorts of GST refunds. No signature is required, and once submitted, this form cannot be changed. As a result, the user must be cautious when inputting the information.

Following are the two processes involved in submitting the GST refund pre-application form:

Step 1: Visit the GST portal and log in, select “Services,” then “Refunds,” and then “Refund pre-application form.”

Step 2: Complete the fields on the “Refund pre-application form1 page that appears, then press “Submit.” There will be a submission confirmation.

The following information must be disclosed:

  • Business nature – Manufacturer, exporter, trader, and provider of services
  • Date of IEC issuance (only for exporters): Those requesting a refund on account of exports (without paying tax) must provide the Import Export Certificate’s date of issuance.
  • The primary authorized signatory must have an Aadhaar number.
  • Value of exports produced in FY 2019–2020 (just for exporters) – This has to be calculated at the GSTIN level rather than the PAN level.
  • Fiscal Year 2018–2019 income tax was paid.
  • Tax advance for the 2019–2020 fiscal year.
  • Invested in and made capital during the 2018–2019 fiscal year.
READ  Important Changes in GST as per the Union Budget 2023

Procedure of GST Refund

For taxpayers requesting a GST refund, a specific application must be submitted. Let’s look at how the GST refund process works below:

STEP 1: They must submit Form RFD-01, which must have a Chartered Accountant’s certification within two years of the pertinent date. Each case will have a different relevant date. It is crucial for taxpayers to keep track of the pertinent dates because if the application is not submitted by the deadline, the credit will be blocked.

Below is a definition of the cases:

  • When the ship or aircraft exits Indian boundaries, if exporting products via air or water.
  • When the commodities reach the nation’s land border, they are being carried by land.
  • The post office’s dispatch date for packages being shipped via mail.
  • The payment reception date is pertinent for services (where the services are finished before the payment).
  • When paying in advance for services, the invoice date is crucial.
  • The conclusion of the same fiscal year will be the pertinent date for excess unused ITC.
  • For considered exports, supplies to SEZs, and 100% EOUs, the return filing date will be relevant.
  • When the decision in favour of the appellant is made: The date on which that decision was made is relevant.
  • The date at which the tax was revised for assessments made after a provisional assessment.
  • Refund for third parties: The day the items are received is the relevant date.
  • The date of tax payment shall be the appropriate date in all other circumstances.

STEP 2: After the taxpayer completes the application, Form RFD-02 will automatically create the information and the acknowledgement. The same would be sent to the applicant for future references via email and SMS.

STEP 3: The applicant must submit Form RFD-03, which will be supplied to them, in order to address any errors, deficiencies, or inadequacies in their GST refund claim.

Documents Required for GST Refund

  • The applicant must submit an online refund application and provide the necessary supporting documentation.
  • The taxpayer must declare that the amount of the refund has not been used by or transferred to any other person if the claim for the GST refund is for less than Rs. 5 lakhs.
  • Additionally, if the claim for the GST refund is for more than Rs. 5 lakhs, a document demonstrating that the money was paid by the taxpayer must be provided in addition to the declaration.


  • The application for a GST refund must be submitted within 90 days (from the end of the quarter during which the goods or services were received) whether the applicant is a consulate, organization under the United Nations, or foreign embassy. The Form RFD-10 must be filled out for the application.
  • If the reimbursement is less than Rs. 1,000, no refunds will be made.
  • A refund application is processed in around 30 days.

How to claim a Refund on IGST (with tax payment) paid on the export of goods?

Under the GST, exports are regarded as “Zero-rated supplies.” Therefore, the exporter is entitled to a refund of the tax (IGST and cess, if any) that was paid. Since exporters’ transaction volumes can be quite high, the GST site makes the GST refund procedure easier. In this instance, a second application in form RFD-01 is not necessary. For the exporter to receive a GST refund, a number of requirements must be met.

READ  An Overall Concept of Input Service Distributor (ISD) under GST

First, the shipping bill information connected to export transactions (together with tax payment) must be entered into Table 6A in GSTR-1 and submitted by the deadline. Second, the return must be filed by the due date specified by GST legislation, and the summary details must be recorded in item 3.1 (b) of Table 3.1 of GSTR-3B. The relevant tax must also be paid.

The exact and comprehensive details for the shipping bill number, date, and port code must be included in the export invoice data submitted under Table 6A of Form GSTR-1. Keep in mind that export transactions must be reported in the GSTR-1 and GSTR-3B of the same applicable tax period. It is important to take care to declare the combined amount of IGST and cess in Table 3.1 of GSTR-3B as a number that is equal to or higher than Tables 6A and 6B of GSTR-1.

The shipping bill is regarded as a refund application by the GST administration. According to what is stated on GSTR-1, the GST site transmits export information to ICEGATE. Additionally, a confirmation that the GSTR-3B form was submitted for the applicable tax period is received. The Customs system conducts the refund after comparing the data on GSTR-1 to the data on their shipping bill and Export General Manifest (EGM).

Once the refund has been credited to the taxpayers’ accounts, the ICEGATE system will exchange payment details with the GST site. The taxpayers would receive the information from the GST portal by email and SMS.

GST Refund Order

The authorized official must issue a preliminary refund order when tax is demanded for exports of goods or services. 90% of the refund claim must be submitted in Form RFD-04 with this order. Only the following scenarios permit the issuance of this interim order:

  • When the taxpayer hasn’t been accused of dodging taxes for more than Rs. 250 lakhs over the course of five years.
  • When the taxpayer receives a score of at least 5 (out of 10) on the GST compliance scale.
  • When the taxpayer has no open refund-related appeals or reviews.
  • The authorized officer issues a final order when the taxpayer receives a “go” signal from him or her after all the paperwork has been reviewed and found to be in compliance with the law.

The government does, though, also keep a cash ledger that is updated each time a person files a tax return. It is necessary to match it with the credit in order for the refund to be issued. The application procedure will take about 60 days in all other circumstances. These events are also surrounded by additional circumstances. When the refund is subtracted from the taxable amount, Form RFD-06 is completed and submitted.

The additional forms include RFD-07, which documents the total denial of a refund request; RFD-09 is for delayed payments, whereas RFD-08 is for payment guidance.


When it comes to GST rules, a thorough GST refund method enables you to recover the extra tax you have paid and ensures that you never lose the excess amount paid. This enables corporate organizations to keep their cash flow in the company steady and sizable.

Frequently Asked Questions

  1. How do I process a refund claim in GST?

    ·         Register on the GST website to submit a refund application under the refunds area.
    ·         Navigate to the Application for Refund option under Services > Refunds.
    ·         'Refund for excess balance in cash ledger' should be chosen as the refund reason.

  2. Can I claim a GST refund online?

    The provider must issue a tax invoice if the cost of your purchase exceeds $82.50. This can serve as the foundation for your computations, and you can record any online GST payments when you submit your BAS.

  3. What is the electronic refund process?

    Through the e-refund technique, students' bank accounts are instantly credited with their financial aid. If a student's account has a credit balance, the school will reimburse it. It can take 3-5 business days for this procedure to show up in a student's account.

  4. How long can I claim a GST refund?

    A person seeking a refund must submit an application before the “relevant date” specified in the Explanation to Section 54 of the CGST/TSGST Act, which is two years from the time the application must be submitted.

  5. Can we claim GST on clothes?

    Clothing producers, wholesalers, and retailers are eligible to submit ITC claims for the GST they paid on the materials, packaging, and other inputs utilized in the creation of clothing. But you cannot claim an ITC for the GST you spent on things like rent, energy, and other overheads.

  6. How do I receive a refund?

    Having your tax return electronically put into your bank account via the IRS Direct Deposit Program is the quickest method to receive it. You may deposit your return into as many as three different accounts, and it's free for customers. Follow these steps right now to get a head start on your taxes.

  7. Who can claim an ITC refund in GST?

    A registered person may submit a refund claim for unutilized input tax credit at the conclusion of any tax period in accordance with Section 54(3) of the CGST Act, 2017. The time frame for which a return must be filed is known as a tax period.

  8. What is the law & procedure for GST refunds?

    Every refund claim must be made within two years after the relevant date, according to the GST statute. Additionally, Section 34 of the CGST Act 2017 allows credit notes to be issued for post-supply discounts or when items are returned within a predetermined period of time.

  9. What are the rules for refund in GST?

    Every refund claim must be made within two years after the relevant date, according to the GST statute. Additionally, Section 34 of the CGST Act 2017 allows credit notes to be issued for post-supply discounts or when items are returned within a predetermined period of time.

  10. What is the rule 89 of GST refund?

    In cases where the application relates to the refund of an input tax credit, Rule 89(3) of the CGST Rules, 2017 states that the applicant must debit the electronic credit ledger in an amount equivalent to the refund being requested.

  11. Can I claim GST on everything?

    Input credit can be used on both products and services since GST is levied on both (apart from those that are on the exempt/negative list) since it is charged on both goods and services. Capital items are eligible for input tax credits. Products and services intended for personal use are exempt from input tax.

  12. What is issuing a refund?

    A refund is a sum of money that is given back to you, sometimes because you overpaid or returned something to a store.

  13. Is a refund of GST taxable income?

    The extra tax that you paid is what is referred to as the GST refund amount, which is not regarded as income. It is thus not taxed.

READ  Consequences of non-filing of GST returns



Trending Posted

Get Started Live Chat