GST Refund Rules & Processes (Complete Guide)
The GST refund process allows registered taxpayers to claim excess GST amounts if they have paid more than their GST liability.
However, they can claim after submitting a refund application with the details in the GST portal.
If you are struggling to know details about GST Refund Rules & Processes (A Complete Guide), this article is for you.
Let’s get started!
You can check the refund status on a government website, by clicking on the link.
The process of refund is online and time limits have also been set for the same.
You can exclude the COVID pandemic period (1st March 2020 and 28th February 2022) while calculating the time limit for filing GST refund applications under Sections 54 or 55 of the CGST Act.
Here are some of the cases where a refund can be claimed:
- Exports of commodities or services
- Deemed exports
- Refund of taxes when embassies make purchases
- Supplies to developers and units in special economic zones
- Refund of the accrued input tax credit on account of inverted duty structure
- Refund of pre-deposit
- An Appellate Tribunal, Appellate Authority, or court-ordered refund
- Refund of taxes when embassies make purchases
- Finalization of provisional assessment
- Excess payment because of an error
- Refund due to issuance of refund vouchers for taxes paid on advances against which commodities or services haven’t been supplied
- GST refunds to overseas tourists when they depart India for an international destination on commodities purchased within the country
- Refund of SGST and CGST paid by considering the supply in the course of interstate commerce or trade
What is the process of refund in GST?
Follow the below steps for a refund:
- GST refund application filed electronically in Form GST RFD-01.
- GST refund application must be processed within 14 days by the concerned officer.
- Now, two cases can occur-
- If the application is not acceptable, the application must be resubmitted with correction.
- If the application is acceptable, refund payment is completed within 60 days.
The concerned officer will re-credit the amount claimed as a refund through FORM GST RFD-01B.
How much GST refund will I get?
The refund amount can be calculated as:
Refund Amount = (Turnover of zero-rated supply of goods + Turnover of zero-rated supply of services) × Net ITC ÷ Adjusted Total Turnover.
If the refund is on the export of goods and services, the authorized officer will refund 90% of the total amount claimed as a refund on a provisional basis in Form GST RFD-4.
It is mandatory for the applicant to provide a certified refund application if the amount of refund exceeds Rs 2 lakhs.
Refunds of tax or interest must be requested in Form GST RFD-1 within 2 years of the ‘relevant date’.
What are the types of refunds?
Here are the following types of refunds:
|Type of refund
|Supporting documents to be uploaded
|Refund of unutilised ITC on account of exports of goods or services without payment of tax
(A valid LUT/Bond in Form RFD-11 must have been filed)
|(i) Copy of GSTR-2A of the relevant period(ii) Statement of invoices (Annexure-B*)(iii) Self-certified copies of invoices which are not found in GSTR-2A but entered in Annexure-B(iv) BRC/FIRC in case of export of services and shipping bill in case of goods^(*As per the attached format below)(^Applicable only in case of exports from ports which does not have Electronic Data Interchange (EDI) facility)
|Refund of tax paid on export of services made with payment of tax
|(i) Copy of GSTR-2A of the relevant period(ii) Statement of invoices (Annexure-B)(iii) Self-certified copies of invoices which are not found in GSTR-2A but entered in Annexure-B(iv) BRC/FIRC/any other document indicating the receipt of sale proceeds of services(v) Self-declaration that the applicant has not been prosecuted for five years from the relevant period where tax evaded is more than Rs 2.5 crores
|Refund of unutilised ITC on account of supplies made to SEZ units/developer without payment of tax
|(i) Copy of GSTR-2A of the relevant period(ii) Statement of invoices (Annexure-B)(iii) Self-certified copies of invoices which are not found in GSTR-2A but entered in Annexure-B(iv) Endorsement(s) from the specified officer of the SEZ regarding receipt of goods/services for authorised operations
|Refund of tax paid on supplies made to SEZ units/developer with payment of tax
|(i) Self-certified copies of invoices which are not found in GSTR-2A but entered in Annexure-B(ii) Endorsement(s) from the specified officer of the SEZ regarding receipt of goods/services for authorised operations(iii) Self-declaration that the applicant has not been prosecuted for five years from the relevant period where tax evaded is more than Rs 2.5 crores
|Refund of ITC unutilised on account of accumulation due to inverted tax structure
|(i) Copy of GSTR-2A of the relevant period(ii) Statement of invoices (Annexure-B)(iii) Self-certified copies of invoices which are not found in GSTR-2A but entered in Annexure-B
|Refund to the supplier of tax paid on deemed export (DE) supplies
|(i) Documents required under Notification No. 49/2017-Central Tax dated 18.10.2017(ii) Documents required as per Circular No. 14/14/2017-GST dated 06.11.2017To read more about it, please check out this article
|Refund to the recipient of tax paid on deemed export supplies
|(i) Documents required as per Circular No. 14/14/2017-GST dated 06.11.2017To read more about it, please check out this article
|Refund of excess balance in the electronic cash ledger
|Refund of excess payment of tax
|Refund of tax paid on an intra-state supply which is subsequently held to be an inter-state supply and vice versa
|Refund on account of assessment/provisional assessment/appeal/any other order
|(i) Reference number of the order and a copy of the Assessment/Provisional Assessment/Appeal/Any Other Order(ii) Reference number/proof of payment of pre-deposit made earlier for which refund is being claimed
|Refund on account of any other ground or reason
|(i) Documents in support of the claim
How do I check my refund status?
Please find these steps to check the refund status:
- First, log in to the e-Filing website with your User ID, Password, Date of Birth / Date of Incorporation, and Captcha.
- Press My Account and click on Refund/Demand Status.
- Below details would be displayed-Assessment Year, Status, Reason, and Mode of Payment.
Who is eligible for a refund of GST?
A registered taxpayer can claim a refund of GST at the end of any tax period, as per Section 54(3) of the CGST Act, 2017.
In other words, a refund can be claimed on monthly basis.
Also, the applicant should file GST refund claims within 2 years from the relevant date.
Within 60 days, a refund will be sanctioned, if the claim is in order. The amount of interest on the withheld refund shall apply at the rate of 6%.
Is the GST amount refundable?
Yes, the GST amount is refundable. And you can claim a refund within 2 years from the relevant date.
Can I claim a GST refund after 2 years?
No, there is no such provision to claim a refund after 2 years. You can carry forward it to the next financial year.
Can I get a GST refund on a laptop?
Yes, you can get a GST refund on a laptop if you have purchased from a GST-registered retailer and received a debit note/tax invoice.
Can we withdraw the GST amount?
Yes, you can claim the GST amount if the wrong amount is deducted. Form GST RFD-01A is to be filled by the taxpayer to claim the refund of the excess amount in the electronic cash ledger.
How do I apply for a GST refund?
Follow the below steps for GST refund application in RFD-01:
- Go to the Services tab in the GST portal, click on Refunds, and then the Application of refund option.
- Now, select the reason for the refund or the type of refund and click on Create refund application.
- Enter the period and click on Yes or No.
- Based on the type of refund selected in the previous step, enter the details on the relevant page that gets displayed.
What are the documents required to claim a refund?
Documents required to claim a refund are:
- The invoice
- A statement containing the number and date of shipping bills (bills of export or endorsement of receipt of goods/services)
What is requirement for statement 3 GST refund?
When a refund application is made to obtain a refund of accrued ITC due to the export of goods or services without paying taxes, the following document must also be included with the GST RFD-01:
- A statement detailing the export of goods must include the shipping bill or bill of export’s number and date, as well as the relevant export invoices.
- A statement containing information about export invoices, coupled with the applicable Bank Realization Certificates or Foreign Inward Remittance Certificates number and date
Statement of invoices (annexure-b) format
FAQ: GST refund
When should I expect my tax refund in 2022?
Within 45 days of ITR processing, the income tax refund should be credited to your bank account.
What are the 3 stages of refund status?
There are three stages after which the refund process is completed. Below are the stages:
- Return Received
- Refund Approved
- Refund Sent
After the processing of your tax return, you will get personalized refund information.
Can we claim GST after 6 months?
Yes, you can claim GST after 6 months.
However, after 6 months, you have to pay back the Input Tax Credit to Customs which you claimed earlier due to non-payment to his supplier.
Can I claim tax back from 3 years ago?
Generally, the taxpayer must file a claim within 3 years from the date the return is filed, or 2 years from the date the tax was paid, whichever is later, or within 2 years from the date the tax was paid if no return has been filed.
What if GST returns have not been filed for 3 years?
In case, the GST returns are not filed for three consecutive tax periods, then the GST officer can cancel the GST registration of a composition taxable person.
We hope all your queries related to GST Refund Rules & Processes (A Complete Guide) are now answered.
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